America’s Banks and Your Money

For many years, major banks in the U.S. have been managing your funds in ways that benefit them more than you.

And they’re clearly coming out ahead.

Companies like BlackRock, Wells Fargo, JP Morgan, and Bank of America offer a meager interest rate of 0.4% on your savings. Meanwhile, they have quietly built up billions in investments that generate significant returns.

Let’s consider this from your viewpoint.

At that 0.4% rate, it would take over a hundred years to double your savings.

Yet those large institutions are seeing their funds double in just a few years, using your deposits.

This is more than just a discrepancy; it feels like a scam.

Here’s a quick calculation that might frustrate you:

If you put $10,000 into your savings, the banks would pay you just $40 a year.

During that time, they can invest your money elsewhere and earn thousands.

Yet, you only receive that $40.

But there’s even more to unpack.

The average money market account pays less than 0.6%, and even a one-year certificate of deposit yields about 1.6%. Meanwhile, inflation is hovering around 2.7%.

This means your buying power is decreasing daily, all while banks profit from your hard-earned cash.

So, what options do savers have?

One option is to invest in Treasury bills. Right now, 3-month and 6-month rates are just above 3.5%. But keep in mind, once they mature, you might have to reinvest at a lower rate if interest rates drop.

If you’re willing to take on a bit more risk, consider good dividend growth stocks. This could provide you with returns comparable to a Treasury bill, but you might also see your dividends increase annually, which could help maintain your purchasing power.

Additionally, there’s an investment that I find particularly appealing right now, which boasts an average annual return of 29% over the last 25 years.

This presents a conservative method to benefit from the AI boom without diving into highly volatile stocks, untested technologies, or companies that engage in complex financing structures.

No confusing schemes here.

Instead, it involves a reliable company with a long-standing history that has been active well before AI became a trending topic.