If you are 30 or above, chances are that you were taught from a very tender age to save in piggy banks. That small box where mama or papa asked you to drop money and leave it until after a long time, sometimes many months or years. When its that time to take back your savings, the piggy bank is broken - often with much excitement and anticipation - and the saved money is counted. That is often the end of that savings and if you are to start again, a new piggy bank/box is provided. We enjoyed it probably, but things have changed a lot.
Today in the world of finance, many players have emerged well and beyond the wooden piggy box. Blockchain technology with its cryptocurrencies have revolutionized the way we make, save and use money. While some old methods still work, the issues I want to look at in this article is important and can be summarized in this question:
- Are piggy banks still relevant or should we switch to cryptocurrencies?
While this article is by no means financial advice, it gives us something to think about especially if one still saves with the piggy.
Piggy banks - The positives
Piggy banks served their purpose during the time they were popular. Of course, one would not deny that from an early age, it helps kids to develop savings culture. Most of these kids grow to become adults that make better financial decisions. So the piggy method of saving helped many people today to learn how to save.
Additionally, piggy banks helped to instill the idea that big things start small. Dropping in small coins of probably little value into that box over time will accumulate and become big money. Of course in times of financial need, the accumulated savings can be used to solve a problem.
There could be many other benefits of saving through the piggy system. But then, we also need to look at the down side of piggy box in line with current financial realities
The downside of Piggies
Looking at the piggy system of saving I have noticed a lot of things that are probably wrong with it. They include the following:
Piggy money does not make more money: The rich will always tell you that your money should work for and make more money. It seems this would not be possible with the piggy bank system. Because you continue to drop money into a box and that money does nothing there. It simply sits idle, waiting for the future when the bank is broken. Basically, the only way that money grows inside a piggy box is to put more money. In this time of many crypto saving opportunities - like crypto staking - that guarantees return in savings, the piggy system really makes you miss out on this.
Financial Uncertainty: While as kids we enjoy the surprise of having an unknown amount of money, an adult today that saves with piggy and relies on it to solve big problem will be in trouble. When you put money into a piggy box, there is no financial record of it. You actually have money, but do not know how much. Can you fully depend on this type of savings to pay rent, school fees, buy property or even do other things? You know the answer, right?
Piggy money is not safe: The piggy box is usually hidden away somewhere in the room - where we consider 'safe'. But then, is there really a safe place in your house? Is there a place in your room, that cannot be destroyed by fire, accessed by some intruders - and in some cases- protected from rodents? What happens to your piggy bank if there is a natural disaster such as the recent cases of flooding in some parts of the world? If you survive it, will your savings in the piggy make it? Again, it seems you know the answers.
Sudden change in the financial System: What if the government make laws that affects paper money. What if there is a sudden change in the bills you use in your country. What happens to money in the piggy? For example, in my country Nigeria, the government suddenly announced that it will reprint some Naira notes and all old notes will no longer be accepted as legal tender beyond December 2022. Right now, there is panic among those that have stashed a lot of cash somewhere outside of the banking system. So if you had recently started saving in piggy, or you have saved for a long time, you have a short time from now to break your piggy bank and change the money. Your plans have been spoiled, isn't it?
Inflation is a problem for piggies: In my country again, inflation is a big problem. Recent data shows that it is nearing 17% which is really high. So our money continues to loose value against the US dollar. So keeping away money for a long time in a piggy will make it loose its value over time. The exchange rates in my area are now scary.
Pigges were nice - Crypto (Hive) is the future
Personally, I believe that piggy banks served their purpose. Maybe they are still more useful than I think. But looking at the downsides above and the enormous opportunities offered by cryptocurrencies, I have long destroyed my last piggy bank.
Cryptocurrencies offer us limitless financial opportunities to increase money through savings. There are many crypto products that offer much more returns than a piggy, sometimes even over a short savings period. The Hive blockchain is booming with such opportunities through many dapps that offer you something in return for keeping away some crypto.
Do you know that if you save your Hive dollar (HBD) in the savings section of your wallet, you earn an amazing 20% Apr? The information is right there in your wallet. Here is a screenshot from mine below:
Conclusion
If piggy banks still work for you, then you do what works for you. I have come a long way in the crypto sector to appreciate its numerous savings opportunities. I will continue to explore the ones on this Hive platform and take advantage of them.
Lets talk
have you ever used piggy banks to save? Do you still use it? Share your experiences with me in the comment section