The less fortunate, middle class, and the rich - you name it, everyone is feeling it. This inflation is making us lose purchasing power.
Inflation this year has been scaling up, leaving everyone panicking and dumbfounded. The rising prices and the overall price stability of goods are affecting how we consume goods and services. Even our favorite imported wheat bread, Fuwa Fuwa, has gotten higher prices. The gas prices have gotten you thinking that maybe it is time for you and your family to start living a more active life. Suddenly you find yourself keeping track of your finances and hesitating when your beloved child ask you to buy them something. That is why you should forget the bank, and appreciate your Crown Asia house and lot for sale more because if there is one thing that would boost your finances and keep you afloat throughout the chaotic and painful consequences of inflation, it is your real estate. Although, to be safe, sure leave some money in your savings account, but if you really want to be at the better end of this deal, if you want to be among the rich who are benefiting even more during these tough times, you need to put the majority of your money in investments.
Let us talk about why investing is still a good move when purchasing power is limited due to prices rise and the consumer price index becomes more unpredictable:
Do what the rich do: invest
Do what the rich do invest
First off to hedge against inflation, let us start with what most people who, unfortunately, do not know any better, do: pile up their money in the bank. Understandable because this is what is commonly taught. We have always been told to put our money somewhere that is safe and secured, little to no chance of getting stolen. And the first thing that comes to mind to give that kind of assurance is a reliable bank. But there is this saying that is little known to others: the poor spend, the middle class save, the rich invest.
And with this spiked inflation, we want to be in the spectrum of the rich, right? Especially when they are getting even richer during this seemingly tough time.
Don't just add money, multiply it by investing
Why invest? Let us compare the profit of the two. The highest interest rate of our banks here in the country is 2%. And that is already rounded off. On the other hand, the returns you can get in investments in the Philippines go as high as 17%. To picture it even clearer, say you invest 3 million in a bank that has interest rates at 2%, you will get 60,000 pesos per annum. Looks a lot, yes, but that hardly compares to what you can get through investments. If you invest the same 3 million in a company whose interest rate is 17%, you will earn 510,000. In other words, every two years, you can purchase a house and lot for sale with that kind of return rate.
Indeed, if you want to build that generational wealth for your kids and your future grandchildren, the way is to invest. You will hardly earn money by putting them in one safe basket that is a bank. A savings account is for people who are not willing to take the leap to greener pastures. Meanwhile, investments are for people who know better.