Findingnemo
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August 30, 2022, 10:48:09 AM |
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Saving ones money is good but could be a disadvantage during inflation. During inflation, price of goods might have increased rending your saved money valueless. In 2020, a friend bought his middle generator at #46,000. I had the same amount but decided to save mine in bank. Last week, I decided to buy the same generator, just to check a store online to see price was now around #85,000. See the difference in price within 2 year. Bank can never put such difference as interest on the saved money. CONCLUSION During inflation, 👉👉always purchase all you need on time without delay to avoid rapid increase of such commodity. 👉👉Unnecessary saving should be avoided. Savings should only be made from excess income which one doesn't need at that moment. Lastly, investing is highly preferable to savings. Savings the Fiat cash for long term is stupidest mindset, if you have money and you know that you don't need that for years then go for investment atleast something with guaranteed returns which is higher than the inflation in your country. Savings in the gold bonds is highly recommended if you did that instead of just keeping it as cash you probably bought what you need now.
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ethereumhunter
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August 30, 2022, 12:13:46 PM |
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Everyone has a choice to keep their money in the bank, buy them daily necessities, invest in things they already do or invest in crypto. It also depends on how they understand the meaning of inflation that can occur at any time and if they don't think too much about inflation, they are just trying to fulfill their daily needs. And @OP has already chosen what he thinks is best to do and although he did decide to keep the money in the bank, I guess it was at his discretion. But hopefully, he also invests in other things, namely bitcoin or something.
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SirLancelot
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August 30, 2022, 12:15:49 PM |
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CONCLUSION During inflation, 👉👉always purchase all you need on time without delay to avoid rapid increase of such commodity.
👉👉Unnecessary saving should be avoided. Savings should only be made from excess income which one doesn't need at that moment.
Lastly, investing is highly preferable to savings.
We should buy before inflation or after inflation and not during inflation because the prices of the goods during that time are skyrocketing. Savings is mandatory and it is not unnecessary because savings is not like spending where your money can only decrease but it's true that it's better to save money which isn't really needed so that you won't touch your savings later on if ever you invest most of your salary on it. On the last part, investing is also important but I think saving should be our priority because it is less risky but investing especially in cryptos has a risk because their values are fluctuating. If we like to do both, we should have a separate money for them and savings money should not be touch only to add more assets on your investment.
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Haunebu
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August 30, 2022, 12:29:20 PM |
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Well said op. Honestly, I possess decent money saving skills since I tend to only spend money whenever absolutely necessary though that is very, very difficult to maintain in the long-term for obvious reasons.
I like the manner in which you demonstrated the negative impact of inflation on savings through a detailed example.
Most people including me are already aware of this stuff since it's common sense, but your post serves as a useful remainder as to why saving money isn't always the right decision.
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sayaya17
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August 30, 2022, 02:19:48 PM |
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Savings the Fiat cash for long term is stupidest mindset, if you have money and you know that you don't need that for years then go for investment atleast something with guaranteed returns which is higher than the inflation in your country. Savings in the gold bonds is highly recommended if you did that instead of just keeping it as cash you probably bought what you need now.
With high inflation every year, it is indeed not a wise choice if we save fiat in the bank, especially for the long term, it only makes the value of our savings decrease. Because banks usually provide a small interest rate if we save in the bank. It's different if we use our money to invest in assets that can provide greater profits than rising inflation. If we want to be safe, we can invest in the stock market, Gold and Real Estate. But if we want to take a higher risk, investing in crypto is my most recommended. Although the risk of investing in crypto is very high, but if we can choose the right coins, our opportunity to generate profit is very large. So my advice is just save money in the bank only to buy daily necessities, if we have extra money, invest in crypto, or want a safer investment in the assets I mentioned earlier.
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naira
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August 30, 2022, 02:32:08 PM |
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I don't know if turning your savings into cryptocurrencies might be the right decision. Maybe it will be in the long term. Unfortunately the high fiat inflation is combined with a "crypto winter" on the crypto markets. Perhaps after one or two years, those crypto investments will pay off, when the bull run hits the crypto markets.
It is true that the correlation between the two always has an impact at almost the same time. During inflation, the value of paper money is at stake as well as when the crypto market is affected by the withdrawal of investors to shift their assets to gold which is considered stable. But another alternative when inflation is Bitcoin can also be chosen. People feel reluctant to transfer assets depending on how we know inflation will be prolonged. There are two elements of investors who run to crypto and those who run their finances to gold. At the same time, gold is in the control of governments and banks while Bitcoin is in the hands of its owners. Therefore I think to take the proper steps then Bitcoin is the choice in times of inflation.
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LoyceMobile
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August 30, 2022, 02:40:01 PM |
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Inflation is made by central banks, and is not in the interest (pun intended) of most people. I would like my money to keep it's value, but as long as one person can decide to inflate fiat, that will never happen.
And that's why central banks fear Bitcoin: they can't inflate it.
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Jawhead999
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DGbet.fun - Crypto Sportsbook
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August 30, 2022, 02:41:38 PM |
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I don't think anyone should quickly purchase any commodities that they want to buy without a delay because it depends on when you need it and how long your will use it, that's important to know to prevent from unnecessary spending.
Savings is useless if you want to hedge against inflation, investing is the only way though it's have a risk.... but we don't have choice here.
I think investing in garden can be an another choice for people who scared about digital stuffs and scared to get a fake commodities.
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inthelongrun
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August 30, 2022, 03:57:55 PM |
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Savings is still very important but it should be limited like allocating some money for emergency purposes. During the pandemic, I moved the bulk of my bank savings into stocks. The problem is the whole stock market went down too and their value now are worse than the high inflations happening right now. I heard a lot of people in the stock and crypto market mentioning that cash is the king right now which I still disagree with, for as long as there is still enough emergency funds in the bank.
OP posted a machine as an example. If that machine is necessary and is used in order to generate profit then it is a good decision. Otherwise, it will only depreciate in value.
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Flexystar
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August 30, 2022, 04:31:16 PM |
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Even this happens in the industry wide financial management. For example, in mechanical driven industries they will always stock up the warehouse with all the jobs they want for the production and thus to avoid the yearly “incriminating” costs for the raw materials and finished products.
In fact we are taught that if company has enough funds then they should always stock up non expiring and non diminishing products in bulk so that when rest of the industry would be buying at high cost and adding the cost into finished product; we would be the one who will sell the finished product at cheapest rate.
So I can completely relate the generator example here and yes there is no point in saving at least when it comes to the daily required stuff.
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Gayong88
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August 30, 2022, 04:57:13 PM |
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I've always assumed that inflation is a function of interest rates, if interest rates go up, the purchasing power of money will fall. But if high inflation will reach 10% in three months, then something must be done before that time. Inflation does not respect purchasing power, only for exchange rates. This is why we need to add money to your bank account on the right day, or it will be useless at the end of the month.
The future of inflation is a broad topic that spans not only the next decade, but could last for decades. Thus, there is no way of knowing for sure whether we have surpassed it at this point or not.
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kesmex
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The OGz Club
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August 30, 2022, 06:01:41 PM |
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Purchasing things wouldn't be our main option during this inflation crisis but rather surviving. Most countries are struggling so purchasing expensive stuff would be hard. Most of us are just earning enough to sustain our daily necessities. Also, I would rather invest in potential coins than save my funds in banks because crypto has risks yet could be more profitable in time. The long-term investment would be the right choice that we have so despite the crisis, we could have a guarantee of good profit in the future.
With the current inflation I think we have to really manage our finances wisely, the price of basic commodities is increasing and that is certainly not the condition we want, Don't waste money on what you don't need
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m2017
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keep walking, Johnnie
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August 30, 2022, 06:33:49 PM |
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Money was created not to save wealth with it, but to buy goods and services with it. That is, money is not a tool for saving at all. This is exacerbated by inflation. Therefore, the comparison of saving with investment is incorrect in view of the difference in goals and objectives. Of course, investing is preferable to saving, because it allows you to offset or outpace inflation. This will be a tool for preserving wealth (income). Attempts to save wealth in money are doomed to failure, because every year these savings decrease due to inflation / rising prices for goods and services.
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Davidvictorson
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August 30, 2022, 08:55:12 PM |
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CONCLUSION During inflation, 👉👉always purchase all you need on time without delay to avoid rapid increase of such commodity.
👉👉Unnecessary saving should be avoided. Savings should only be made from excess income which one doesn't need at that moment.
Lastly, investing is highly preferable to savings.
All the points you have made are very valid. However, since all fingers are not equal, I would advice that one should save irrespective of whether the economy is experiencing inflation or not. There are unforeseen circumstances that the money one may have put away may just come in handy. Besides isn't the money saved is what one would use to invest in any business venture especially when it is a small venture? It will be a terrible idea to take a loan or to get an investor who may dictate how the business runs because you didn't make any financial input.
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South Park
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August 30, 2022, 10:05:04 PM |
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Many people keep saying that the times of high inflation are the best time to borrow and spend as much money as you can and stop saving. This seems very risky to me and borrowing money only for the sake of borrowing had always seemed like a stupid move. Yes, saving fiat money in the bank in times of high inflation is definitely a wrong financial decision. I don't know if turning your savings into cryptocurrencies might be the right decision. Maybe it will be in the long term. Unfortunately the high fiat inflation is combined with a "crypto winter" on the crypto markets. Perhaps after one or two years, those crypto investments will pay off, when the bull run hits the crypto markets.
It is true that in theory you could borrow money now for a low interest rate and then pay it back with cheaper money in the future, but this is a very risky maneuver, this is something that a person that is very experimented in the world business could do but it is not something that I will recommend for your average person, the most likely outcome for someone like that is that they're going to lose their money, only then they will understand that they got obsessed with the idea of doing something like that but they did not even need it, which will make their failure even more difficult to accept.
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Raflesia
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August 30, 2022, 11:22:22 PM |
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Saving is definitely not something that is good enough especially when inflation seems to be unavoidable. But in this case I agree with some friends here who do invest in some assets such as Crypto or other things that have a clear hedge from inflation very well. Indeed, in this case not only Crypto but as long as they have inflation protection, then storing there is still very good.
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Oceat
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August 30, 2022, 11:59:09 PM |
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It depends on every person's interest though since saving money can make you buy something in the future and if you have enough savings to buy something then it's good. Inflation might be a very good time to buy something if the price of that thing depreciate but if it's hit by the inflation I don't think it's worth it to buy. Some things might drop their original price due to inflation while some may pump 2x to 3x I wouldn't mind if it's important but food somehow is something I can't deny even if the price is rising to almost double or triple. Smh
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lienfaye
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August 31, 2022, 01:48:11 AM |
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Lastly, investing is highly preferable to savings.
Indeed. Saving is good because it still wise to have money that you can count on especially in times of emergency. However we cant expect for our money to gain interest through saving, in banks they're giving very low interest annually. Thus not worth if you're into increasing your savings. Therefore investing is better to achieve your financial goals and to secure your retirement, its possible if ever you succeed in your investing venture. Because inflation is inevitable so its better to not be contented that you have savings, the value of it might be less if you already need it, lets say years after. But when we invest, money is working for us to be financially independent. This is an option to deal with inflation.
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Wong Gendheng
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August 31, 2022, 03:37:46 AM |
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If we only rely on saving, we will not be able to face inflation, I prefer to put money for productive things such as business even with small grades, it's better to put money on friends who do business and the distribution of results we have agreed.
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bitzizzix
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August 31, 2022, 07:57:00 AM |
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It's not that saving doesn't give you a profit, it's just that saving doesn't provide a suitable return and only creates value Your savings will be eroded due to the inflation rate. and there is no better way to save money in times of inflation than by investing because your money is not being eroded by inflation, but rather will increase and by storing money in inflation-resistant instruments, such as bitcoin or crypto, gold, stocks, bonds, property or houses and other investments. and they all have different ways and risks that must be studied and understood well before doing so.
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