’Look at it until it makes you sick’: Grant Cardone says you should be checking your cash, investing accounts every single day — here’s why and what to look for
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Is the average American investor getting scammed? Real estate mogul Grant Cardone believes they are.
“You get money, you work your a– off and then you give it to an institution and forget that it’s there,” he said during an interview with podcast host Lewis Howes. “Wells Fargo is paying you nothing, Bank of America is paying you nothing. You send it to Chase, they're not paying you anything.”
But is Cardone right — is there evidence to suggest that many Americans are getting a bad deal on their bank balances?
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Are savers getting the short end of the stick?
The interest rate on deposits held at major banks is nearly 0%. Wells Fargo, Chase and Bank of America offer entry-level rates of 0.01% on these deposits.
Given that the Federal Reserve’s benchmark interest rates are between 5.25% and 5.50%, bank deposit rates certainly appear like a bad deal.
Start with your everyday bank account. If you want to make your accessible cash work for you, consider a no-fee checking and savings account with SoFi. SoFi offers 4.60% APY on savings balances – which is up to 10x the national average — and 0.50% APY on checking balances.
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A survey of 8.3 million Chase customers by JP Morgan found that the median cash balance in a checking account was around $6,600 depending on income bracket, as of February 2024. That’s a lot of money in aggregate that isn’t earning much interest.
To be fair, these checking accounts are not designed for capital appreciation. Account holders generally use this cash for daily transactions and short-term needs, such as rent and utilities.
High-yield savings accounts currently offer interest rates as high as 5.3% in some instances, according to data from Bankrate.
However, Cardone argued that people are either unaware of better rates or unwilling to go seek them out. “People are unconscious, they don’t know where their money is,” he told Howes.
If you want to put your money somewhere where you know it will grow over a set period of time, consider a certificate of deposit (CD). CDs allow your money to grow at a better rate over a set period of time. But if you withdraw the money before the end of the term, you’ll likely face a penalty fee.
If you want to scope out CD options currently available on the market, CD Valet makes it easy.
With CD Valet – an online CD marketplace – users can shop and compare top certificate of deposit rates from various banks and credit unions nationwide.
Their extensive database shows the most competitive rates without bias, with daily rate updates and earnings calculators which give consumers an array of free tools to help them find the right CD to meet their savings goals.
You can also check out Moneywise's Best High Yield Savings Accounts of 2024 to find some savvy savings options that earn you more than the national average of 0.4% APY. — and make checking your bank balance a little more exciting.
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Personal inventory
Cardone stressed the importance of closely monitoring your wealth and assets.
He noted that he looks at his cash and investments “every single day.” This helps him take “personal inventory” of where all his money is and what it’s doing. He believes this habit is “non-negotiable” for anyone looking to build wealth.
“If [your account] is zero, look at it until it makes you sick,” he said.
If you’re currently at zero and not sure how to increase your increase your savings or start building your portfolio, try Acorns to help you invest as you spend from your bank account.
Acorns is an automated savings and investment app that makes your spare change go to work for you.
When you make a purchase on your credit or debit card, Acorns automatically rounds up the price to the nearest dollar, and places the excess in a smart investment portfolio. This way, even the most essential spending translates to money saved and invested for the future — and you get to generate wealth without even thinking about it.
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Cardone’s financial philosophy echoes the words of management consultant Peter Drucker, who once said, “You can't manage what you can't measure.”
It’s a philosophy that’s baked into modern corporations and professional investment strategies, as they prepare quarterly reports on all their cash flow, assets, liabilities, income and expenses.
Frequently checking your bank account could help you get a better grip on your personal spending habits and cash flow. The next step is to control your cash flow, minimize expenses and start deploying excess cash into investments that will hopefully appreciate over time.
If you invested $1,000 in a high-yield savings account last year at 5% interest it could have generated an extra $50. However, if it was invested in an index fund that tracks the S&P 500, you could have generated $262 over the past 12 months. Over time, these small gains can add up and make a big difference.
Exchange traded funds, or ETFs, allow you to take advantage of the top stocks on major exchanges. Wealthfront makes investing in ETFs convenient by automating your investments.
When you sign up and fill out a quick questionnaire, Wealthfront will build a portfolio for you based on your finances, risk tolerance and investing goals.
As your investing needs change, Wealthfront can automatically rebalance your portfolio accordingly.
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This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
