5. The cost of "withdrawable anytime"

Do you still recall the interest you are getting from your savings account? most of us would have not notice the interest because of its miniscule amount, even so, we are quite happy to keep our money there, why? because its "withdrawable anytime" and this gives us a sense of "safety" as we can take it out anytime! This is the benefit of "Liquidity"!

The average 30-day time deposit rate is around 2.0%, why do you think it is higher than your savings account?

it's because you have agreed to not withdraw your money for 30 days, you gave up liquidity in return for a higher rate.

The first trade-off (you have to choose one over the other) in investment is choosing between "liquidity" over "capital growth."

if you want your funds to be very liquid, forget about capital growth for it will not grow.

if you want your money to grow, be prepared to keep it invested for as long as you can.

#acgadvice