Grant Cardone Says 'Saving Money Is For Losers'

Inflation erodes the purchasing power of money over time, meaning the same amount of money today will buy fewer goods and services down the road. Consequently, saving money without considering investments or strategies to combat inflation could result in diminished value of those savings.

That's one reason real estate mogul Grant Cardone wrote, "Saving money is for losers" in a May 8 post on X.

Cardone's calculations reveal that if you lived in New York or California in 2020 and had $1 million in a savings account earning 3%, your account would have $1.125 million in it today.

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But if you deduct the $48,750 you'd owe in federal taxes, $12,500 in state taxes and the $281,250 "inflation effect," your total loss would be $342,500, leaving your account with a real value of $782,500.

That's a loss of 31% of the value of your savings and doesn't account for the investment opportunities you missed, Cardone said.

Cardone noted that, most people's parents instructed them to "save your money," "prepare for a rainy day" and "a penny saved is a penny earned." The math suggests that saving is losing?"

"Money is being printed at record levels, Biden wants to raise taxes, threatening to take capital gains to 44%, Apple makes biggest buyback in history, Mike Saylor…converting his company's fiat to BTC [Bitcoin] and banks are in the headlines everyday for being vulnerable," Cardone wrote in the post. "What your parents told you about saving money might make ‘sense,' but the math proves saving money does not make money."

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The debate over whether to save money or invest it has gained steam since inflation began to soar and the Federal Reserve began hiking interest rates in March 2022. While high interest rates could mean increased returns on savings, experts say there are many things to consider.

"We're now in a position where you can earn decent returns on cash, and actually, now inflation is falling you can earn higher than inflation on chase," Laura Suter, head of personal finance at AJ Bell told CNBC's "Squawk Box Europe."

However, Emma Wall, head of investment analysis and research at Hargreaves Lansdown, talks in favour of Cardone's point of view. She said investing may have a bigger payoff long-term.

"Investing always outperforms cash over the longer time frames," Wall told CNBC. "Over a 30-year time horizon, history suggests that investing can be twice as powerful than leaving your money in cash."

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