So, what are the benefits of online banking? Well, obviously it’s convenient. You don’t have to walk in anywhere. You can do easy transfers. The problem, and a lot of you, you’re going to have limitations on the amount you can do per day. Even with Zelle, you can only Zelle $2,500 a day.
Cash apps have limits, a lot of them have limits, so you can only move so much money. So, where it doesn’t work is, as you start playing a bigger game. you need to start wiring $50,000, a hundred thousand, a quarter million, a half a million, most online banks won’t do that with a lot of ease and grace. You either have to get on the phone, or minimum, a Zoom camera.
Most of the time you’re going to have to walk in a bank and sign wiring paper and transfer papers. And if you go international, you’re going to have to go in as well. So, it doesn’t solve all problems, but it does make it convenient. Now I’m in the middle of a launch of a kids’ bank. So, I’m going to give you a link to go get our GravyStack app for families, and it’s for kids, and it has a hundred missions and gigs, and it teaches kids about money. www.gravystack.com. It’s based on a lot on the premise of my Make Your Kids Millionaires, where you don’t pay them an allowance.
They’re actually going to design their income for the month, and then it actually has these very cool pipes. So, if they want to make a thousand a month. How much goes into their spend, which then attaches to a debit card. How much goes into investing? Which attaches to iFlip?
So, I’m going to give you that link to go get an iFlip app. https://askloral.com/iflipapp So that is a bank and an investment software portal for you to make and invest your money.
Then the third pipe is about charity, and you’ll click the charities you want to give some money to, and it will actually go to them immediately. So, it’s a very cool, very different. It’s not like Green Light. It’s way more sophisticated, and its gamified. Each kid can get their own avatar. Super cool. So that is part of the online technologies that I’m not only an investor and owner in, I love them completely.
So let me just tell you about banks. So, banks have a 10x experience with the central bank. So, for every say, I’m going to get you up to a hundred thousand, because if you can’t make a hundred thousand, you’re suffering. So, you need to make a hundred thousand a year minimum as an adult. So, as you’re making that money, and you put a hundred thousand say, in a bank, online or otherwise, what you’ve given that bank permission to do is reach up and get 10x. So, for every hundred thousand, you’ve given them a million-dollar benefits.
So, they now can have a million dollars in their capacity to now do consumer loans out for cars or small business loans or whatever your local bank is going to set up a loan for. Maybe they do mortgages and home loans or HELOCs. So, you’re giving them the capacity to have the money. So, you aren’t just not anybody, you’re someone who’s contributing to them.
So, I want you to start looking at your bank as more of a partnership. Now if you want to do some online banking, that’s cool and I want you to have a relationship with the bank. So, let me tell you my laundromat story. It’s my most successful story of being in a relationship with a bank. So, it was years and years and years ago I wanted to buy a laundromat. Why? Because I like businesses that teach kids about money, and that’s an easy fun one, that my son loved to do. So, every weekend we would go down with these huge bags and you’d get all the quarters out of the washing machines and the drying machines, and he would count money. It’s a super fun business for kids, and it’s very, very easy for them to see money coming and going.
It also is pretty relative to why doesn’t everybody have a washer and dryer. It’s amazing what kids think. Anyway, I went to the bank, and I said, listen, I’m putting a million, I’ll just give use a million as an example. I’m giving you a million a year in deposits, which means you can go get 10 million that makes you a lot of money.
So, if you don’t understand arbitrage, that’s what a bank does. They’re going to go get 10 million dollars, they’re going to loan it out to you. They’re going to get it for free because you gave deposits. Oh yeah, they might have given you a toaster, an iPad for the deposits. Good job. What they’re going to do is they’re going to loan it out at 5%, 6%, 10%, 11%, depending on your credit.
So, they’re making money because you give them deposits. So, if you haven’t realized that you need to be in a better relationship with your bank. So, as you grow with a bank, I want you to learn about private banking, personal banking. You should have a personal banker. Then you stop paying for fees, for checks, for just a cashier’s check. I mean, there’re a lot of fees that you’re getting dinged on throughout a banking relationship.
But when you actually create a relationship, you can waive a lot of those fees or get them down to very minimal amount. So, knowing how banks works, help you.
So, I went in, and I said, I’m putting in a million, making you 10. I’d like to go buy a laundromat. I need $200,000 and I’d like it at 0% and of course he laughed, and he thought that was funny. And I said, I know you have to go to your committee. I want a really, really low-interest loan. And he said, well, you already have 200,000, use yours. And I said, I’m using my $200,000 to go buy real estate, and make a whole different amount, like 12, 15, 18%. I want to use your money at a very low-interest rate to go buy another asset. That’s using other people’s money.
So, I ended up with a 2% loan for $200,000, and once I sold the laundromat three years later, I paid them back, paid their 2%, and I’m out. So, I pretty much walked in and out of a laundromat. I think I made about a hundred grand in that move and used their money completely for 2%. That is why you want a relationship with a bank.
Why Are Banks Collapsing? Well, a lot of banks are just used like the Silicon Valley Bank that’s used for tech startups. So, a lot of high, high, high net worth people will put money in the banks and the money’s there on drawdown loans for startup companies to use and to build up their tech stacks.
So, when there was a run on the bank and a little bit of fear, the money got pulled, the bank collapsed. Lot of those startups failed. They had to go back out and get different rounds of funding. So, from all of the world economists that I’m hearing from, I mean, a big bank collapse, is there going to be some adjustment? Will there be digital currency coming? Yes. All that’s going to come. But there won’t be this big, apocalypse collapse.
I just don’t believe it’s going to happen. We’ve watched Bear Stearns. We’ve watched to 2008, 2009, 2010 collapse. We’ve watched people get bailed out. There’ll be a bail out if it happens. So, the only caution I would say is your FDIC limits. Whatever your limits are, probably don’t have more than that amount per account in a bank, because at least you have some insurance.
So that means spread out. I know people who are in 5, 6, 7 banks. I’m in a variety of banks, and banks in other countries. So, spread your money out so you have a little bit of leverage across your own portfolio. If you want to learn more, go to https://askloral.com , and ask questions. Make a request. You have to lean in. You have to learn more. Don’t have any fear about money. You’d have a lack of knowledge about money.
So how do you get the banks to really be your friend? You need to have personal relationships. So, I’m a huge fan of the brick-and-mortar banks. Still, I walk into banks. I have three specific banks that I walk into. I do wires with them because it’s required, because of the amount that I’m wiring. Remember, I do a lot of shark tanking, so my wires are $50 to $250,000 sometimes. You have to walk in, and that’s when you build that relationship.
You say, really? Am I going to pay for checks and a with debit card. By the way, why do you use a debit card? You choose credit cards. Debit cards, I have them. I put them away. I don’t know the last time I’ve used them or know their pins. Why? It takes money right out of your bank. Why wouldn’t you use a credit card at 0% and pay it off every month and actually earn points and have some liability protection?
Because a credit card company is going to go back and fight a charge for you. The bank, if you just did something and you say, oh, I didn’t really want that charge. They’re not going to bat for you.
So, debit card use I think is insane. I start kids at credit card use very responsibly at 12 years old. Use your banks properly. On and offline. So that is the message to do a little bit of both. Have a personal relationship with the bank and you should have them on speed dial. Because they also know where a lot of other wealthy people’s money is, and you’re in a partnership is how I see our banking relationship. They should bring you business because you’re bringing them business. So, change the way you bank today.
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