When I tried to withdraw $20,000 of my own money from the bank.
Two days ago, my business received a $20,000 check. I remembered a story that one of my business mentors, Grant Cardone, told about the time he walked into a bank to withdraw $1,000,000 in cash. Here is the link below, so check it out. Everyone needs this man in their life.
After some of the looks that I got for depositing it, I decided that I wanted to attempt to withdraw just $20,000, vs. the $1,000,000 that Grant did, the following morning to see if there would be a similar reaction. There most certainly was. A video recording was attempted of the encounter, but the quality was too poor with multiple phone call interruptions. Let me tell you my story. First, here is the size of the bank's building . . .
HUGE right? It looks like they may have $20,000 in cash ready for withdrawal right?
So, here we go. I walk into the bank around 10:45. There is no line for the tellers, so I walk right up.
"What can I help you with"-Teller
"I would like to make a withdrawal"-Me
"Alright, just go ahead and slide your card so that I can open your account. How much would you like to withdraw?"- Teller
"$20,000 please"-Me
". . . Uh . . . I don't think we can do that amount"- Teller
"What do you mean?"- Me
"Let me go grab my manager"- Teller
"What is the amount that you want to withdraw?"- Manager
"$20,000 please"-Me
"We are not going to be able to do that amount"- Manager
"Why not? Is the money in the account?"-Me
"Yes it is there"- Manager
"Then why can I not withdraw it? It seems a little silly that a bank cannot allow someone to withdraw funds that are in someone's account"-Me
"We just don't have that kind of cash here. This isn't like the old days. You would have to order it, and come pick it up later."- Manager
"Uhh you guys don't have $20,000 here?"- Me
"Oh, we do"- Manager
"Then why can't I withdraw it. That just sounds a little silly"- Me
"We wouldn't be able to do business for the rest of the day if we did that"- Manager
"Ok, so how much can I withdraw?"- Me
"I am not sure"-Manager
". . ."- Me
"We can do $8,000"- Manager
"What about $10,000?"- Me (Why in the world am I having to negotiate with the bank for my own money?)
"We aren't going to be able to do that. Our vaults just aren't big enough to hold that amount. People just don't walk around with that kind of cash today."- Manager
*Looks at vault
"Your vaults aren't big enough? $10,000 is only 1/2 inch thick."- Me
". . ."- Manager
"Ok, just so that I am clear for my own future reference. You guys have the cash right now, but in order for me to withdraw that amount, I will have to order it to pick it up another day?"-Me
"Yes. We can do $10,000"- Manager
"Ok let's do that"-Me
She doesn't even go to the vault. She pulls the amount out of both teller's drawers.
I have a pretty good idea why this happened. The bank is very quick to deposit your money, and puts road blocks for withdrawals past certain amounts. The banks loan out money (your money btw) in the form of mortgages, credit cards, personal loans, and etc. to make money on the interests. I get it. They have to make money too, but here is something that you probably didn't know. Banks are allowed, by the government, to loan out about 7 times what they have in reserves. SEVEN TIMES. The $20,000 that I had in the bank was worth $140,000 in loans compounding interest to the bank.
This is why your money cannot be taken out as easily as it was put in.
Lets go even a little further. What investments are available to you at the bank? CD's? Mutual Funds? Bonds? What do those returns look like?
<======== What a freaking giant load of BS!
You are literally putting your money into an account that you cannot withdraw for 13 months while making a whopping 1.05%
It gets better. Your bank is then loaning your own money back to you in the form of credit cards with 5%-29% interest rates. Oh, and all of their interest is front loaded in the form of amorAre you frustrated yet? Why don't we do something about that? What can you do about it?
We all need to learn the difference between High and Low financial efficiency. We have all been taught to "save" money . . . that the banks are the "safest" place to put your money . . . but I cannot even withdraw mine. Let me teach you how to control assets instead of saving (making other people rich).
Lets get you into real estate investing. I started with no money, and you can too. There is no debate that real estate is the best and safest investment.
Reach out to me. Let's get your money out of the banks and into cash-flowing, appreciating assets. I am a mentor in the best real estate investing education company rated by the BBB, and I am looking for new members for my team.
Sam Barton
Director, Finance Center @ Chico State | Pro-Bono Financial Planner
6 年Just a quick point, banks can lend out 10x the amount they have in deposits. It's even worse than you thought! It's called "Fractional Reserve Banking"
Sustainable Smart City Developer
7 年About to try to withdraw $20k now. Found your blog and will definitely be calling first. Thanks Sam. Started from $0...yes Real Estate Investing has been a life changer.... #freedomlifestyleinvestors
Entrepreneur
7 年Very good story, Sam
Juris Doctor - University of Richmond School of Law
7 年First I must say that I am Wells Fargo Employee but my views are entirely my own and do not represent the views of the bank. I appreciate your vigor and passion around the real estate investment industry, but it is important to realize that just like with any investment, there is no "one size fits all" option that is right for everyone. This means that in some cases CDs are right, sometimes its the securities markets, sometimes its a small business, and yes, sometimes it is real estate. While although you are right, you can earn good money investing in real estate, just like anything else, as the return grows, so does the required time and risk. Inherently there is more risk in investing in real estate than putting money in a CD, and the gain you will earn reflects that. It is never right to convince someone that an investment is right for them, simply because it can earn a lot or because it has earned money for you or I in the past. The only way that an appropriate decision can be made is by asking thorough questions and understanding goals, competencies, and risk tolerance.
CEO at Katie’s House Foundation- Shared Housing for people in recovery
7 年Had a situation where someone was unhappy with the bank . Requested all their money , he had to return the next day when the amour car arrived .. the bank thought it was a set up to have a bank robbery.. but after he picked it up he was on his own .. to not get robbed. As someone once said to me - " you can't win for losing "!