Everyone is talking ‘inflation’. But what is inflation? In simple term, inflation is a rise in the general level of price over time. This also means that the purchasing power of money is slowly eroding. While the rich maybe not feel the pinch, the poor is definitely struggling.
A bowl of cooked white rice now cost $0.50. That’s a whopping 60% increase as compare to 2007. Cost of living is skyrocketing and seemed no sign slowing down any time soon. Are we facing a shortage epidemic? Or, is it because of speculation?
The rich will tell you, buy gold, buy stock, buy mutual fund…etc. Does it help? How much extra cash do you have to hedge against inflation? High inflation is here to stay for now. What should we do to flight inflation?
As a matter of fact, there is nothing much you and I can do about inflation. But we must take inflation into consideration when making any financial decision. If you plan to retire within 20 years with 1 million dollars, then you better raise your target higher to 1.8 million.
If you still have money in the bank right now, go look for another bank which pay you higher interest rate. I know saving is a not a wise choice, but it is better than spending all your money.
Stop spending beyond your needs. Look for opportunities to make more money and improve cash flow. When you have spare cash, you can invest.
Pay off your debts. Take the highest one first and start making multiple payments. If the payment is $200.00 a month, see if you can cough up $400.00 a month. If not, at least increase your payment.
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