I mentioned in my previous article (Investment Interest Rate and Inflation Rate: An Inseparable Relationship), that you need to find an investment vehicle that offers a much higher interest rate than the average inflation rate.
In reality, this is quite difficult to accomplish as there is no single investment out there that can beat the accumulated inflation rate. However, this situation can be mitigated by diversifying to different asset classes. If you want to have a quick gist of these asset classes, read The Four Types of Asset Classes That You Should Have article.
To have a clear picture of how inflation affects your money's value, I've created a little tool for calculating inflation.
Future Money Value Calculator
| Instruction: Do not add a comma when inputting values. For example, you need to enter 10000 instead of 10,000 to calculate the values correctly. |
Quote
"The lesson is clear. Inflation devalues us all."
Margaret Thatcher
- Your Life In Perspective by ÆlfRæd (Elf Counsel)
