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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.)

Ranveer Allahbadia posts first video since 'India's Got Latent' row: 'Now you will see a new Ranveer'

  • PTI
  • Mar 30
  • 3 min read

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New Delhi: After this full stop, I'm trying to write a new story, said social media influencer Ranveer Allahbadia on Sunday as he returned to social media a month after his comments on "India's Got Latent" sparked a major controversy.


In a new video, titled "Let's Talk" and posted on his official YouTube page, Allahbadia said his podcast "The Ranveer Show" will return soon and pledged to create content with added responsibility hereon.


"There was a forced break, which gave me time to embrace stillness. I got to know that so many Indians consider me a family member... To all of them, sorry. In the next 10, 20, 30 years, as long as I create content, I will do it with more responsibility," Allahbadia said.


"...After this full stop, I'm trying to write a new story. I hope you will all support me and my team in this new phase. All I want to say is thank you... Now you will see a new Ranveer... the podcast will return very soon," he added.


Allahbadia, one of the most influential podcasters with over 16 million followers across social media platforms, landed in a major controversy last month over his comment on parents and sex at Samay Raina's comedy show "India's Got Latent".


He apologised the next day but the controversy refused to die down with multiple police complaints filed against him and those involved with the show.


The Supreme Court granted him interim protection from arrest, though it termed his remarks "vulgar". He was allowed to resume his show by the apex court earlier this month.


Allahabadia said the quality of the podcast will keep improving and he will continue to post four episodes every week.


"In this restarting phase of 'TRS', to all the people who have been supporting till now, there is just one request, make a place for me in your hearts if possible. Give me one more chance.


"I like content creation a lot, I like podcasting a lot, to explore the history and culture of our country, that's my passion. That's what I am doing through my job and that's what I want to do."


Speaking about the tough phase he went through, Allahbadia said he doesn't consider it as a punishment.


"It's a learning, a transformation. God has given so much till now and so I consider this phase also as a gift. It came into my life for the sake of my growth and my transformation. Now I will just let my work speak. I will let my work speak," he said.


He also thanked people who reached out to him after the controversy.


"Your positive messages have helped me and my family immensely during this difficult phase. It was a tough time, facing open violent threats, overwhelming online hatred and countless media articles. Amidst all of this, your DMs provided us with immense support," he added.


Allahbadia said a team of 300 people worked for his show and none of them have resigned in the aftermath of the controversy.


"My entire team has supported me, my entire family has supported me. From the team not even a single person resigned throughout this phase. All our professional associates, business associates, they also supported us. Thank you again," he said.


The podcaster also returned on Instagram and posted a photo with his team.


"Thank you to my loved ones. Thank you universe. A new blessed chapter begins - Rebirth..." Allahabadia wrote in the caption.

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