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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.)

Want to Beat the Heat? Strengthen Your Immunity!

Ayurveda has solutions that can help to naturally rebuild lost tolerance for scorching heat

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Summers have set in, and so has the consumption of Air Conditioners and refrigerated water risen. There was a time when we were tolerant to the scorching heat when Air Conditioners and refrigerators were not a part of life. In fact, refrigerated water, and an air-conditioned room both are hazardous to our health, especially to those suffering from specific medical conditions. Rather air conditioners should be strictly avoided by patients suffering from joint problems, Osteoarthritis, Seropositive rheumatoid arthritis, Seropositive patients, immune disorders, Arthritis. Migraine patients too need to refrain from excessive usage of AC.

 

The best way to fight the impact of scorching heat is to strengthen our immunity and tolerance. The big question remains, how exactly can we do this. The answer lies in history, when Ayurveda gave us a lot of doable remedies, which were passed on by the grandparents to the generation next. All we need to do is, remind ourselves of those, and gradually allow us quit AC completely. The simplest way to eliminate AC in peak summers is to literally put-up wet curtains in the room. It works wonders.  

 

Heat strokes, a common problem

As per Ayurveda, exposure to scorching heat affects the process of blood purification, in case this happens beyond a certain limit, it leads to a heat stroke. Usually, in summers, the amounts of ‘pitta’ or bile which is a yellow-green fluid produced by the liver that aids in the digestion of fats rises. That leads to a lot of perspiration and body heat. To fight heat strokes Ayurveda has suggested a very simple addition that can be made to our everyday meal, that is ‘Gulkanda’ which is basically nothing but rose petal jam. One spoon of the jam mixed with one spoon of ghee if consumed twice a day, heat strokes can be avoided. In addition to this, you can start using Ubtan instead of body wash or soap. That’s the best remedy for excessive perspiration leading to body odour, itching and other conditions that follow.

 

Indian traditions have solutions to everything. Among many, there is this another simple and very effective drink that can be consumed to work on water loss. Add puffed rice to some water and boil it. Once boiled, smash the puffed rice and then strain the mixture. You can mix sugar, salt, cumin power, etc. as per your preference and drink it. 

 

Say no to refrigerated water

Refrigerated water is not healthy at all. It can lead to sore throat, migraine, weakening digestive system, tooth sensitiveness, dizziness, cold stress, so on and so forth. There are simple ways to eliminate refrigerated water. The most popular and oldest concept of storing water in an earthen pot is the best replacement for this. Besides there is a medicinal plant called ‘वाळा’ whose scientific name is Chrysopogon zizanioides. This plant is native to India and is a member of the grass family. This grass can be mixed in the water stored in the earthen pot. Apart from this, all flowers having fragrance like mogra can be mixed in the water stored in an earthen pot to infuse it with the qualities of the flowers. Such infused water stored in earthen pot is very beneficial to combat heat.

 

Replace refrigerated water with

Ayurveda recommends several simple recipes of drinks that we can consume to keep ourselves hydrated.  

  1. Kokam drink which is made of Garcinia indica, a plant in the mangosteen family (Clusiaceae), commonly known as kokum mixed with water, sugar and salt.

  2. ‘Chandanadi mantha’ which is made by straining a rested mixture of water, Chandan power. Adding sugar is a matter of preference. We can also infuse it with edible camphor. It is very useful.

  3. ‘Kharjuradhi mantha’ which is a drink made from dates, Amla, pomogranate, tamrind and black raisins. This is extremely useful to combat excessive heat.

  4. Kheer is an Indian delicacy which basically contains sugar and milk. This dish too helps combat heat.

 

It is understandable that AC has captured our life styles completely and while we gradually attempt to completely eliminate it from our lives, the first step can be to aim at reduced or changing the way we use it while ensuring certain precautions. While its needless to say that regular AC maintenance is a must do, strictly avoiding super chilling temperatures is a very important point. Super chilling temperatures take a toll on patients who suffer from respiratory disorders like  Sinusitis. They experience headache, blocked nose and breathing problems when they spend an entire night with temperatures as low as 18 degrees on the AC, while the room temperature is 30 plus degrees. Make a start, by avoiding exposure to drastically opposite environments.

 

(Writer is MD Ayurveda and a practicing Consultant based in Thane, Maharashtra. Views Personal)

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