You're correct that if someone has to store a physical item (like a car), there are costs related to storage. In the case of 21st century currency, however, alm

You're correct that if someone has to store a physical item (like a car), there are costs related to storage. In the case of 21st century currency, however, almost none of your money actually exists in physical cash [1], the vast majority simply exists as accounting entries, stored as digits in computers (seriously). Traditional banking typically consists of two SEPARATE functions. 1) The first function is the safe-keeping of deposits (for which a fee would normally be assessed as an actual commodity (gold, silver, etc.) would be stored, and you have to pay rent, security, etc. related to the safekeeping of that commodity). 2) The second function is loan intermediation (that is, matching up people who want to invest their money with people who want to borrow it -- as an investor you would receive a return on your money less fees assessed by the bank for determining who should receive loans). Certificates of Deposit (CDs) are the classic example of a bank engaging in this second function. CDs require you to relinquish your ability to withdraw your deposits for an agreed upon term. Modern banking, however, muddles these two functions. Paper bills no longer represent specific quantities of physical commodities held for safe-keeping by the bank. They simply represent themselves, pieces of paper that people continue to accept as money because they were slowly weaned off of using physical commodities. Further, banks are allowed to simultaneously loan out the money you have sitting in a savings account (and pay you interest on it) but also give it to you in physical cash should you demand it. How can it be that your cash could be in two places at the same time (invested in a loan but also available for withdrawal)? If you loaned your car to a bank, and they lent it out to someone else, could it simultaneously be available for retrieval by you and also continue to be loaned to someone? Obviously not, it's no different with money. But, because cash is fungible, and most people don't withdraw all their money at the same time, banks are able to continue this charade, pretending like your cash is available for withdrawal while simultaneously lent out to someone else. The only time that the charade becomes readily apparent is during financial crises. During crises people get nervous and start demanding their deposits in cash, if everyone should do so (a run on the bank), the bank would not have enough cash on hand to make good on their contractual obligations. The only reason the charade continues is because central banks loan banks more money during crises by printing more money out of thin air (of course, there's no such thing as a free lunch, money printing debases the currency, so anyone who holds cash loses). [1] Estimates vary, but the consensus seems to be that less than 10% of "money" actually exists in printed bills/coins: (a) Estimate 8.3% -- https://www.quora.com/What-percentage-of-the-worlds-money-is-printed-in-cash-bills-coins (b) Estimate 8% -- http://www.howstuffworks.com/currency6.htm