best place to save money

Where is the Best Place to Save Money?

Americans are saving more money than ever, yet interest rates are at an all-time low. If you’re looking for the best place to save money, it might be time to stop saving with banks.

A recent CNBC article states: “In the midst of the coronavirus crisis, many Americans are spending less and saving more. At the same time, banks are paying next to nothing on those deposits.”

Are you, too, looking to stash cash, but want to make sure you’re doing the most with your money? Today, we’re talking about this unspoken challenge from a fresh lens. 

So if you want to learn about one of the best places to save money, so you don’t have to give up returns or resort to high risk in search of them… tune in below!

Why More People are Saving

Americans are saving more money than ever, yet savings rates in the banks are at an all-time low. So how does a scenario like this happen?

We think primarily, COVID-19 has been an eye-opener for the world. On one hand, workers who were affected by job closures have likely realised that they didn’t have enough money saved to fall back on. While a tough lesson to learn, the fact that Americans have been successfully saving more money gives us hope. After all, having money saved is what enables you to weather economic storms (and seize opportunities when things are going well).

On the other hand, business closures meant a lack of things to do. Movie theaters and aquariums closed, museums closed, and restaurants and shops closed. Pretty much all indoor, and many outdoor, businesses had to shut down for a good portion of the year. This also means that many families turned to other alternatives for entertainment, in other words: free. Hiking, swimming, and being outdoors became more popular. Americans started saving more money by default, because so many businesses put a halt on operations.

So not only are people choosing to create better savings habits, they’re also creating better spending habits. Now that you have the money, it’s time to ask—where is the best place to put your money?

Interest Rates and the Federal Reserve 

A tumultuous economy means changing interest rates. The Federal Reserve controls interest rates, and in order to boost the economy, they’ve lowered rates dramatically—almost to zero. Meanwhile, they’ve also pumped trillions of dollars into the banks. Now, banks are at a surplus—meaning that overnight lending between banks is down, as are savings rates.

In the past, banks and would use high-interest rates and “prizes” to incentivize opening accounts at their establishment. Now, with a surplus, there’s no need for banks to offer this incentive. High savings rates are the banks way of broadcasting that they want your money, and they’re willing to offer something in return. Now, banks can lower these incentives almost to zero, because they aren’t relying on that money to come in.

We’re seeing a mis-match in supply and demand. While there’s a high demand for a safe place to store liquid cash, where it will also grow, there’s relatively low demand from banks for new accounts.

Decline of Customer Service

A decline in customer service is one of the unfortunate consequences of this low interest rate market. Because banks do not need new accounts, they are not incentivising new customers; this also means that there is no incentive for them to provide better customer service. Combine that with a high demand for saving and a pandemic, and the issue worsens. Lobbies are closed, drive-through lanes are cramped, and phone service is difficult.

Bank Accounts and Lending

Under normal circumstances, banks have higher interest rates on savings accounts and money market accounts because they do want your money. Ultimately, because that’s how they make theirs. You see, banks don’t lend their own money to their customers. They leverage their customers’ money—YOUR money.

best place to save money

For example: If you deposit $100,000 into a savings account, making 0.05%, you’ll earn $50 on that deposit. Then, say that bank agrees to loan that same $100,000 to someone else for their mortgage. If they offer an interest rate of 3%, that’s $3,000 of interest. So the bank is making 60 times what they’re paying you in interest. In other words, for a $50 dollar investment in your savings account, they’ve made $3,000.

We’re not arguing that the banks shouldn’t make a profit. However, we are saying that this is the reason for low interest rate markets—to bolster banks and get money recirculating.

Yet what if you could store your money elsewhere, earn a better savings rate, and be able to leverage that money in the same way as the banks do? Because if the bank can do it, so can you. 

Where Is It Best to Save Money?

Utilizing a strategy we call Infinite Banking, you can do what the banks do, and at a better savings rate than you’ll get with the banks. It starts with a specially designed whole life insurance policy, with a mutual company.

This concept that has been used for hundreds of years, yet it feels like it’s one of the world’s best-kept secrets. Why? Because today, it’s primarily the super wealthy who use this strategy.

Whole Life Insurance: Emergency Fund and Alternative High Yield Savings Account

To clarify, life insurance is not a savings account, however, it is the best place to store liquid capital that we have found.

One of the great strengths of a whole life policy is the savings rate. Whole life insurance has a cash value benefit, on top of the death benefit. This is cash that you have access to while living and is guaranteed to grow each year. You can also receive non-guaranteed dividends, however, most companies have paid dividends for over a hundred years.

To do what the banks do, you can take a policy loan. Rather than liquidating your cash value, you’re using your value as collateral to get a loan from the insurance company. When you withdraw money from a savings account or money market fund, you stop the full compounding growth of your money. When you take a whole life insurance policy loan, you keep your money in place so it can compound uninterrupted…and you still have money to use.

Then, you can use that policy loan for cash flowing investments and opportunities. As Robert Kiyosaki says, you should look to use “other people’s money” (OPM) as often as possible. The more you can create situations of leverage, the more you can grow your wealth at the same time as you create new streams of income and cash flow. 

Why Isn’t it Mainstream?

One reason Privatized Banking strategies aren’t well-known is because insurance companies are very conservative with how they spend money. This says something about the strength of the insurance companies and how they’ve survived every economic downturn. One way these companies cut spending is by limiting their advertisements; instead, they rely on their producers or agents to do the advertising or word-of-mouth ads for them.

Book A Strategy Call

Do you want to coordinate your finances so that everything works together to improve your life today, accelerate time and money freedom, and leave the greatest legacy? We can help!  

Book an Introductory Call with our team today, and find out how Privatized Banking, alternative investments, or cash flow strategies can help you accomplish your goals better and faster.

That being said, if you want to find out more about how Privatized Banking gives you the most safety, liquidity, and growth  … plus boosts your investment returns, and guarantees a legacy, go to to learn more.

Rachel Marshall

Rachel Marshall is the Co-Founder and Chief Financial Educator of The Money Advantage and President of Marshall's Insurance and Financial Services. She is known for making money simple, fun, and doable. Rachel has built a team of licensed professionals (investment advisors, insurance agents, attorneys, tax strategists) to help her clients create time and money freedom with cash flow strategies, Privatized Banking, and alternative investments. Rachel is the co-host of The Money Advantage podcast, the popular business and personal finance show. She teaches how to keep more of the money you make, protect it, and turn it into cash-flowing assets.
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