The Occupy Cookbook is a “do it yourself” program that shows you how to keep your hard earned cash out of the hands of the one percent. One way you can stop giving the one percent your money is to know who they are… America’s Richest People …and what companies they own Fortune 500. The best way to keep your money out of the hands of the one percent is to buy local.
Now doing business locally takes a little time at first but pays off in the long run. Multiple studies show locally-owned independent restaurants return twice as much per dollar of revenue to our local economy than chain restaurants. And independent retailers return more than three times as much money per dollar of sales than chain competitors. This information coming from the American Independent Business Alliance: AMIBA multiplier. That means you return 2-3 times more wealth back to your community if you buy locally as compared to national chains which take two thirds of that wealth out of your community.
The largest household expense most Americans share is their mortgage. And we can’t really talk about mortgages until we talk about the 2008 recession. You remember the 2008 recession, right? Our nations banks took it upon themselves to manufacture financial instruments which led to a reduction in wealth among U.S. citizens of over seven trillion dollars, Banks Destroy Middle Class. Because the banks were so big and the prospect of having them fail would have done more damage than good, the U.S. government bailed them out to the tune of 640 billion dollars and provided trillions in low or no interest loans. Despite the fact that what these banks did bordered on the criminal, no charges have been filed against anyone for bringing about a recession that was the worst since the great depression. Not One Executive Charged.
In any event, you’d think that someone would fix the problem. Maybe break the banks up. Well, they’ve actually grown bigger and represent over 60% of the nations gross domestic product. Six Largest Banks. You know what that means? That means the prospect of having this happen again is very real. So let’s remove that threat. Let’s take our money out of the hands of those responsible for the crash. And if you don’t know what banks those are check them out here: Bailout List . See any of those six largest banks in the list?
The best way to get your money out of the hands of those responsible for the crash is to bank local. Community Financial Institutions tend to offer higher rates of return on savings accounts and lower interest rates on loans. The reason for this is that Community Financial institutions are best informed on the needs and interests of the local community. Some, like credit unions, are even not-for-profit which means they pass profits through to their members. Do a little research. Go to Bank Local and find a Community Financial Institution in your town. Compare their rates to those of your bank.
Now when you look at mortgage rates an eighth of a percentage point here and there may not seem like a lot of money when you look at your monthly payment. But if you go out to dinkytown.net and use their Mortgage Loan Calculator, you’ll see that an eighth of a percentage point works out to a one_eighth_interest_savings when you compare what you’re going to pay over the life of a thirty year mortgage. It’s pretty clear that national banks charge more and pay less. If you want to check out other savings and loan scenarios, dinkytown.net is a great place to start.
That’s it for this session of the cookbook. Feel free to spread the word. Next blog: Food.
Jim Sea holds a Masters in Divinity from the Iliff School of Theology, a Masters in Social Work from the University of Denver, was a registered investment advisor and a residential realtor.