Inflation continuously eats into the value of your cash. Your purchasing power. It can feel quite upsetting when you are constantly losing the battle of diminishing cash value. Your money is worth less and less, every single day. To make matters far worse, one’s ‘pay’ and/or ‘investments’ are not even close to keeping up. In fact, for many or most people, ‘investments’ have been losing value. Inflation is killing us…
Although it has come down a bit recently, today’s inflation (CPI-U) is right around 6.4%. The traditional way they used to measure it (1990’s-based) it’s at 10%. And the same inflation rate the way they used to measure it (1980-based) inflation is nearly 15%. Source (shadowstats.com)
Regardless of which number you choose, I’ll bet your annual pay isn’t going up that much. Or I’ll bet your investments aren’t going up that much (probably not even remotely close to it). I mean really… who’s investments are beating inflation these days? Unless you get lucky with high risks, it’s been a losing proposition. So what’s a person to do?
It certainly seems like these prices are not coming down anytime soon – if ever. Probably never. There may be an exception here and there… For example, it’s possible that the housing market ‘bubble’ might deflate or pop in regions where today’s high prices can longer be supported (high interest rates coupled with inadequate incomes). But for the most part, I just don’t see prices in general coming down whatsoever. Again, so what can you do about it?
Here’s my opinion. First, if you’re in the category of those who are in debt (especially credit cards), it’s smart to get out. You’ve got to stop the bleeding (paying the high interest rates on your debt). Okay, that’s out of the way. Now what? What about those who are not in debt, but your worth keeps getting chewed up by inflation?
Invest In Sustainability
Invest in yourself. Your self-sustainability. Whatever that is for you and your situation.
Every dollar that sits around in a bank, or in your pocket, is losing more than 6% (10 or 15% if you look at the old way they calculated inflation). Instead, you might put it to work for yourself. Even your investment money… when’s the last time you got a 6, 10, or 15% annual return on that? Soon as the Fed stopped QE (quantitative easing money printing those years ago), it all ended in that department… Since then it has been mostly pain. And the investment markets have quite the potential for further pain.
Therefore all I see as alternatives are monies spent on practical scenarios that directly improve your own health, well being, sustainability, and security. Invest in ‘you’.
Sure, have some cash on hand (essential for some emergency situations). Sure, you might consider purchasing some silver (and/or gold) for long term wealth preservation diversification. However what’s more important for investment than you and your family? That’s where you might focus.
If you’re able, I would put an emphasis on whatever it takes to further your own food production sustainability. Spend your money on that. Food!
If things get worse out there, or especially if things get really bad out there (lots of possible scenarios), FOOD will become more upfront and center. Instead of others being in control of your food, why not you be in more control of your food? Use your money to buy materials to expand your gardens. To expand your food/harvest preservation capabilities and supplies. Did you know that chickens lay eggs? Maybe that’s something you might consider too. All these things cost money upfront, and money to maintain. Seems like a good investment proposition to me…
Maybe you use some money to lengthen your growing season. How’s that? Ever heard of a greenhouse? You might build one, or maybe you buy a kit? Small, medium, large? You could conceivably spend a good chunk of change on this, but what else are you going to do with your cash in today’s inflationary environment? Spend it on your self sustainability.
What about energy? Maybe you start planning and purchasing the necessary equipment to supplement your energy? Although the break-even timeframe can be out there quite a bit (depending on what you do), it sure is a peace-of-mind thing too… Having enough energy (e.g. solar, battery bank, etc..) to power essential systems.
Your health? Spend money on whatever it may take to improve your own health. Maybe you buy a treadmill or indoor stationary bicycle for winter exercise (as just two examples). Nothing is more important than your health. Maybe you improve your diet, which may mean spending more money on better foods (than junk). What else can you spend on yourself for health?
Can most of us agree that we live in a world of great uncertainty? To the extent that one’s own security may become increasingly at risk as time marches on? More ‘tapped out’ people. More crime. Drug use. Desperation. What can you spend money on to improve your own security – be it personal or home security?
See where I’m going with this? When I sit here and wonder where one might invest money in today’s shithole economy, I realize that it’s a losing battle in the traditional sense. Money in the bank is just plain stupid (except holding enough for your emergencies – plus a margin). All the rest is just getting chewed up by inflation. So in my opinion you’re better off spending it on yourself in ways that may improve your health and well being, your sustainability, and your security.
Any other ideas?