lifestyle
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w e a lt h m a n a g e m e n t
Ditch your cash,
and live Richly!
By Kurt Matthews Jr.
“Purchasing an item or service is no
longer a terminus. It’s the beginning,
or rather, the continuation of one long
transaction. Buying something used to
be the goal of labor. Now it is another
form of labor .....Abstracted from our
wallet into a zillion means by which we
accrue rewards, our dollars, roll up their
green sleeves and go to work harvesting
points as if they were grapes.”
(Lee Siegel, author) (1)
B
efore discussing this quarter’s
topic, I wish to thank the readers
of WPB Magazine and its sister
publications, who approached me,
or attended my break-out sessions at
the recent Global Luxury Summit in
Miami. I was honored to be one of the
invited speakers to the thousand
executives, entrepreneurs and inves-
tors. I enjoyed sharing finance and
banking strategies; funding your busi-
ness needs and providing insights into
my vision for the future. Please con-
tinue to send in your questions, ideas
and requests. See you at next year’s
multiple-day Global Luxury Summit
conference, this time in San Diego, CA.
How many times have we heard the
age-old quip “make your money work
for you, its what wealthy people do!”
or, “money begets money.” These
refrains still hold true and in more ways
than you think. In prior articles I spoke
about using “compounding of interest”
to maximize your wealth. Now, here’s
another bit of advice, “leverage”
your use of digital currencies to get
wealthier and simultaneously enhance
your life experiences.
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In the beginning there was “cash”
*(3) Paper money has been in use
for 1,400 years!!! The Chinese, started
carrying folding money during the
Tang Dynasty (A.D. 618-907. As a
matter of fact the word ‘cash’ was
originally used to describe the type of
round bronze coins with square holes
commonly used in the Tang Dynasty,
kai-yuans. Despite this long and
impressive legacy, hard currency will
definitely not exist in the decades to
come, let alone the next 1,400 years.
*(4) The top-5 cashless countries and
percentage use of digital currency
(debit cards, credit cards, mobile pay-
ments, crypto-currency), over cash,
are as follows: Singapore (61%), The
Netherlands (60%), France (59%),
Sweden (59%) and Canada (57%).
In case you are wondering, the USA
ranks 8th with usage of 45%.
Move to “digital currencies”
My personal wake-up call, regarding
the growth of online banking away
from traditional bricks-and-mortar
bank branches and the move to cash-
less banking, came, in late 2016, when
my companies received notices that
their Palm Beach island banks, Citi-
bank and TD Bank, were closing their
doors for good. With the growth and
sophistication of technology, banks
finally felt comfortable announcing
that handling billions of coins and
bills everyday is a logistical nightmare
(cash must be guarded, transported
etc.), its expensive (old currency must
constantly be taken out of circulation
and replaced, it must be counted,
registered etc.), its risky (bank
branches and armored vehicles
54
constantly fall victim to robberies) and
it makes the bank no money as banks
are not paid when we spend cash.
Alternatively, digital currencies allow
banks to charge merchants on every
penny we spend. However, the brand
new problem for banks is cybercrimes
(thieves hacking into individuals’ and
institutions’ digital wallets and the
banks’ systems).
Carrot and stick
Banks and fintechs (financial tech-
nology companies) compete daily to
coax us into buying in to their vision
of a cash-free world. They do this by
weaning us on incentives, discounts
and generous “rewards programs”,
such as :
1- cash back
2- points-based awards
3- air travel miles
4- relationship-based awards (eg, on
the spot price discounts on retailers’
websites, ‘coupons’ for rental cars and
restaurants, ‘free nights’ at hotels, ‘free
groceries’ at supermarkets etc.)
5- capital appreciation and invest-
ment income, i.e. wealth management
linked to our daily shopping chores.
My personal experiences: (a)
I recently received a surprise reward of
$25 PayPal loyalty points that allowed
me to ‘splurge’ on my first Fitbit like
running watch, a super-computer
in microcosm that records distance
run, speed, steps taken, running time,
calories consumed, fat burned and
of course time of day and date. Wow!
(b) I draw-down on my hundreds of
thousands of reward points to pay my
$195 Amex Gold annual membership
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j u ly t h r u s e p t e m b e r
2017