Managing your money in a low-interest-rate environment

Like it or not, the new age of money management has arrived.

If you do not adapt to the changes that have occurred over the years, you are in deep sh*t. (sorry, I cannot find a better way to communicate this point across).

In this article, I will be sharing with you the changes that had occurred over the last 3 decades, their impact, and how we should adapt and position ourselves for the next three decades.

The playing field has changed drastically

Over the last 30 years, the key change that killed the old age of money management is the decline in interest rate.

Previously, putting your money in the bank could earn you a respectable 6% a year back in the 1980s. Today, the deposit interest rate is at 0.12% a year.

Such a dramatic, yet steady decline in the interest rate had killed off the role that bonds and bank deposits play in the area of money management.

Previously, it was still possible for someone with zero financial planning knowledge to accumulate wealth by blindly saving and stashing away (no pun intended) their hard-earned salary into the bank.