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By:

Kaustubh Kale

10 September 2024 at 6:07:15 pm

Silent Money Killer: Loss of Buying Power

In personal finance, we often worry about losing money in the stock market, dislike the volatility associated with equities or mutual funds, or feel anxious about missing out on a hot investment tip. Yet the biggest threat to our wealth is far quieter and far more dangerous: loss of buying power. It is the invisible erosion of your money caused by inflation - a force that operates every single day, without pause, without headlines, and often without being noticed until it is too late....

Silent Money Killer: Loss of Buying Power

In personal finance, we often worry about losing money in the stock market, dislike the volatility associated with equities or mutual funds, or feel anxious about missing out on a hot investment tip. Yet the biggest threat to our wealth is far quieter and far more dangerous: loss of buying power. It is the invisible erosion of your money caused by inflation - a force that operates every single day, without pause, without headlines, and often without being noticed until it is too late.
Inflation does not take away your capital visibly. It does not reduce the number in your bank account. Instead, it reduces what that number can buy. A Rs 100 note today buys far less than what it did ten years ago. This gradual and relentless decline is what truly destroys long-term financial security. The real damage happens when people invest in financial products that earn less than 10 per cent returns, especially over long periods. India’s long-term inflation averages around 6 to 7 per cent. When you add lifestyle inflation - the rising cost of healthcare, education, housing, travel, and personal aspirations - your effective inflation rate is often much higher. So, if you are earning 5 to 8 per cent on your money, you are not growing your wealth. You are moving backward. This is why low-yield products, despite feeling safe, often end up becoming wealth destroyers. Your money appears protected, but its strength - its ability to buy goods, services, experiences, and opportunities - is weakening year after year. Fixed-income products like bank fixed deposits and recurring deposits are essential, but only for short-term goals within the next three years. Beyond that period, the returns simply do not keep pace with inflation. A few products are a financial mess - they are locked in for the long term with poor liquidity and still give less than 8 per cent returns, which creates major problems in your financial goals journey. To genuinely grow wealth, your investments must consistently outperform inflation and achieve more than 10 per cent returns. For long-term financial goals - whether 5, 10, or 20 years away - only a few asset classes have historically achieved this: Direct stocks Equities represent ownership in businesses. As companies grow their revenues and profits, shareholders participate in that growth. Over long horizons, equities remain one of the most reliable inflation-beating asset classes. Equity and hybrid mutual funds These funds offer equity-debt-gold diversification, professional management, and disciplined investment structures that are essential for long-term compounding. Gold Gold has been a time-tested hedge against inflation and periods of economic uncertainty. Ultimately, financial planning is not about protecting your principal. It is about protecting and enhancing your purchasing power. That is what funds your child’s education, your child’s marriage, your retirement lifestyle, and your long-term dreams. Inflation does not announce its arrival. It works silently. The only defense is intelligent asset allocation and a long-term investment mindset. Your money is supposed to work for you. Make sure it continues to do so - not just in numbers, but in real value. (The author is a Chartered Accountant and CFA (USA). Financial Advisor.Views personal. He could be reached on 9833133605.)

Biomedical Waste: A Silent Threat in Plain Sight

Medical waste generated from routine tests prescribed by a doctor has the potential to become a serious public health hazard.

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Subsequently, in accordance with the directives of the Honourable Supreme Court, the Ministry of Environment and Forests (now the Ministry of Environment, Forest and Climate Change – MoEF&CC), Government of India, notified the Bio-Medical Waste (Management and Handling) Rules on 27 July 1998. These rules were issued under the provisions of the Environment (Protection) Act, 1986.


Since their introduction, there have been several amendments and changes to these original rules. These developments will be discussed periodically in this series of articles.


Biomedical waste, also referred to as medical waste or hospital waste, includes any waste that poses a risk of infection to humans or contains potentially infectious material. This type of waste is typically generated during healthcare delivery, research activities, and other medical procedures.


It is defined as “any solid, fluid or liquid waste, including its container and any intermediate product, which is generated during the diagnosis, treatment or immunisation of human beings or animals, in research related thereto, or in the production or testing of biologicals, and also includes animal waste from slaughterhouses or similar establishments”.


How and where this kind of waste is generated

Sunita is feeling unwell. She has a sore throat, headache, body aches, and a general sense of discomfort. She is also running a slight fever. It is time for her to visit the family physician. Her family doctor conducts a routine check-up and prescribes a few medicines based on his initial diagnosis. Sunita follows the prescription carefully. However, her condition does not improve.


Sunita visits the doctor again. This time, the doctor advises her to undergo a series of routine laboratory tests, such as a Complete Blood Count (CBC) and a urine test. Sunita proceeds to a pathology lab to get these tests done.


At the lab, the technician arranges several vials for sample collection and hands Sunita a plastic cup for urine collection. He then takes a new set of disposable syringes and a sharp-tipped needle. Following standard procedures, he draws the required amount of blood into the syringe, transfers it into the appropriately labelled vials, and then discards the used syringe and needle into a bin.


All done. But if you were to pick up that discarded syringe (not that you should) and examine it closely, you would see that the needle tip is still smeared with a bit of blood. The inner surface of the syringe also contains traces of blood. And let us be clear—this ‘bit’ of blood is highly infectious and poses a serious health hazard. If you accidentally prick your finger with it, you could be exposed to harmful pathogens.


Now, Sunita is not the only one who visited the pathology lab that morning. On average, fifty to sixty prospective patients might have visited that single lab on any given day. But that lab is just one among many. There are hundreds of similar laboratories operating across the city, all providing diagnostic services.


Starting to get the picture? One can now begin to estimate the sheer number of discarded syringes and needles generated daily by all these labs. And hold on—this is just the beginning of biomedical waste generation. If Sunita’s blood test results confirm the infection her doctor suspects, she may need to be hospitalised for further treatment. And with that, the production of biomedical waste will continue.


Let’s wait a week to find out what happens to Sunita in the hospital. Until then, have a great weekend!

(The writer is an environmentalist.)

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