What it is
Inflation is the slow rise in prices over time. ₹100 today buys less than ₹100 did ten years ago. Even if your bank balance stays the same, your purchasing power is falling.
Why it matters
Money sitting idle in a current account or low-yield savings is actually losing real value. That's why investing isn't just for the wealthy — it's how regular savers keep up.
How to use it
- 01
Don't hoard large amounts in current/zero-interest accounts.
- 02
Keep emergency money in high-yield savings or liquid funds.
- 03
Invest long-term money in instruments that beat inflation.
- 04
Think in real returns: (returns − inflation), not just returns.
In real life
At 6% inflation, ₹1 lakh today is worth about ₹55,000 in 10 years. A savings account paying 3% loses 3% of real value every year. Compounding works both ways.