Welcome To Money Mondays: What Actually is... Inflation

This is for the woman who has been told her whole life to save money and did and is now watching that savings account quietly lose the race. You did everything right. The system just didn't tell you the full game. Which is why we're diving into inflation today. 

Not just what it is. But why it matters. And what to do about it.

Do You Feel Like..

Everything is more expensive but your paycheck is the same? I track this personally. Same grocery list I've had for years completely different total at checkout. What were once seen as starter homes in Jax selling for $150k are selling for $400k.. not so starter anymore. It feels like you're living the same life but now it's just got a way bigger price tag. And the frustrating part is it feels personal. Like you're bad at money. Like if you just budgeted better or made a few more cuts you'd get ahead. I want you to stop blaming yourself. What you're feeling has a name. It's called inflation. And it's been pick-pocketing you so slowly you almost didn't notice.

Inflation: What It Actually Is

Inflation is the gradual decrease in what your dollar can buy. Prices go up. Your dollar stays the same. So it buys less. That's it. That's the whole thing.

Here's the version that made it click for me. Imagine you put $100 in a jar in 2019 and buried it in your backyard. You dig it up today. It's still $100. Except now that $100 buys what $85 used to buy. You didn't lose the money. But you lost the power of the money. Inflation is time stealing from your savings without touching them.

The government targets 2% inflation a year. That's considered normal, even healthy, a sign the economy is moving. But in 2022 inflation hit 9.1%. That means prices were rising almost five times faster than they were supposed to. Your dollar was losing value at a speed we hadn't seen in 40 years. And wages? They didn't keep up. They never do. For most people they probably heard that they won't be receiving pay increases or full bonus's this year. And they wonder why we have to switch jobs every few years.. 

So what causes it? A few things:

1. Too much money in circulation: more dollars chasing the same amount of goods means each dollar matters less.
2. Supply chain problems: when things are harder to make or ship, prices go up.
3. High demand: when everyone wants the same thing and there isn't enough of it, sellers charge more. All roads lead to the same place. Your money gets quieter.

Why This Matters

This is the part hustle culture will never tell you. Working harder is not the answer to inflation. Earning more is not enough on its own. Because if you earn more and park it in a savings account paying 0.5% interest while inflation is running at 3% you are still losing money. 

The only way to outrun inflation is to put your money into things that grow faster than it. Assets. Investments. Things that work while you sleep instead of sitting in an account quietly shrinking.

A dollar invested today is not just a dollar. It's a dollar that fights inflation for you. That's not a nice-to-have. That's a necessity.

Hustle culture tells you to earn more and grind harder. Investing tells you to make the money you have do the work instead. One of those buys your time back. The other one just sells more of it.

You're an absolute queen. Stop letting inflation steal from you in silence.