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We’ve finally arrived! This is the end of my blog series on being your own bank. Not only have we walked through the fundamentals of how banks function, but we’ve also gone more in depth into the practicals of what personal banking looks like.

In this final post, I’m going to write a few thoughts that I haven’t been able to touch on, simply because they didn’t fit the topic or flow of my previous posts. However, I believe these points are just as important in our personal understanding of how we can be successful being our own bank.

Not a Get Rich Quick Scheme

I think many of us who desire to be our own bank want to do so because of how traditional and corporate financial institutions have, on a very large scale, misused and mismanaged the public’s money. Some of us may have even had personal experience with this. We’ve seen how these financial institutions have gotten rich off the backs of the average individual, and then screwed them over through their mishandling of money. Their actions resulted in financial crises that their clients had to suffer through while they got off free because of political and economic connections.

Being your own bank is, I believe, the direct opposite of this. We don’t have the legal ability to mismanage money as heavily as financial institutions and traditional banks do, and so we must be more careful with what we do. We aren’t trying to get rich quick like the big corporations. In fact, if we try to do so with this method, we’re going to find that we owe much more money than we’re taking in, thus going further into debt than when we started. Since the average person can’t be bailed out of their own mismanagement, often the people who want to get rich quick with leveraging and collateralizing assets find themselves in a worse situation than before.

Debt is a tricky thing to manage. Good debt can very quickly become bad debt if one doesn’t know what he or she is doing. And so, it’s far better to be more conservative and grow slowly than try to use this method to make a quick buck and be far more at risk of losing more than what you started with.

Thinking Long-Term

The security of our material value no longer lies in the our accounts at banks or even investing institutions, but rather in assets that we purchase and own, and therefore have complete control over. The slight caveat to this is in real estate, where government still has some say over your ownership of property. This is why we diversify, and in terms of material assets, there are definitely diversification opportunities outside of real estate, and even outside of what I’ve mentioned so far in this series.

The crux behind being our own bank is to think long term. And I don’t just mean long term growth, but also long term stability and security. If what we have is growing, but isn’t secure (as in the case of any kind of stock market investment), then that growth really depends primarily on external forces we can’t control. At which point it’s just better to keep your value at an institution again. However, if we have stability and security, but no growth or ability to leverage (as in the case of bonds), then we actually lose our value over time due to inflation.

Since secure assets that always grow will often grow slowly, we are driven to thinking about the long term when we become our own bank. Having timelines for when we collateralize or even sell to purchase assets along five, ten, and even twenty year timelines will help give financial purpose and stability for our own personal lives, even through global recessions.

A Low Barrier to Entry

Since we’re securing our value through the purchase and ownership of assets, being our own bank requires that we have at least one source of income to start with. For most of us, this means having a traditional job as an employee, though that isn't a necessity. After all, with the Internet and platforms like YouTube, Patreon, and even Coil, people can increasingly raise and earn an income independent of traditional bosses and employers.

By having a source of income through which we can pay our expenses, save money, and spend, we can task ourselves to manage it well. In other words, an income isn’t just required, but becomes an incentive to steward and manage personal finances well. As we grow and save, we learn through being our own banking to obtain and leverage assets that we can use again and again in the future.

The True Beginning

However, that still isn’t the most basic part of becoming our own bank. I’ve found that, over the years, if I only have the practical methods, but don’t have the conceptual mindset to propel those methods, I won’t follow through. In being our own bank, understanding the truth of what money actually is, and the value of assets over devaluing debt, will go a long way to helping to continue along a path of true financial independence.

The great thing about this is that this is something anyone and everyone can do. And that was part of the point of this series. Being our own bank, with complete control over one’s finances, is something that anyone can participate in, no matter their income level. You start by just changing the way you think. When you’ve changed your perspective and begin moving into being your own bank, it’s hard to go back to the old ways which build dependency and pointless insecurity.

This is the end of my series on being your own bank! I may from time to time in the future revisit this series with new updates and other thoughts. In the mean time, I'll be moving onto other things I want to write about. Hope you enjoyed the ride!

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Header Image taken from here.