If you leave your money in a standard savings account earning 1% while inflation is at 4%, you are losing money every single day. Inflation is the rate at which the general level of prices for goods and services is rising, and consequently, the purchasing power of currency is falling.
The Rule of 72
A quick way to understand inflation's impact is the Rule of 72. Divide 72 by the inflation rate to see how long it takes for your money to lose half its value. At 6% inflation, your purchasing power halves in just 12 years.
How to Protect Your Wealth
To beat inflation, your money needs to grow faster than the inflation rate. This means moving cash into appreciating assets like stocks, real estate, or inflation-protected bonds.
Curious about how much your money will be worth in the future? Use our Inflation Calculator to see the real impact of rising prices on your savings.