HOW TO SAVE YOUR SELF FROM INFLATION?
In layman’s term, inflation is defined as the decline in the value which is today , when we are talking about values, here value means the values of goods and services.As I remember, we used to get two samosas for Rs.10 but today we don’t even get a single samosa in the same price but the note of rupees 10 is still the same; the reason behind this is simple, inflation. Speaking it in scientific terms, inflation is the rate at which the prices of goods and services increase.

Time and again, you must have heard from your previous generations about how the rate of a plot has changed over a short duration of time; the plot which one used to get at a very nominal price is now valued at crore. It is also due to inflation. . it made them to worry and find the solution for it. Dear readers, you may have also heard from your parents or guardians not to spend extravagantly. at that time, we used to think that all these things are useless . they also used to give advises for savings by stating the importance of the same. After facing the real world and understanding how the things work, I understand that the elders were right in their approach. I don’t know if they knew it or not but in a way, they wanted us to be protected from the inflation. During their times, there were only limited things to reallocate or invest the money so I think they were definitely right in there approach and we should consider their ideas and methods but in this changing world we can not only depend on those methods we need some more methods to save ourselves from inflation.
There is a perception among the people’s that Investment is only way to hedge inflation, then it would not be entirely correct to say that because Investment is one of the ways to hedge yourself from inflation but it is not a complete way or solution to avoid inflation. If you want to save your money from inflation you must have a good and relevant knowledge of personal finance. Main pillars of personal finance are given below:
Earning or Income, Expenditure, Spending , Saving, Investing and Protection .
Let me explain you about mentioned topic in brief:
1.EARNING OR INCOME:- Income refers to sources of cash flow that individual receives and then uses to support themselves and their family . It is the starting point of one’s financial planning . If you completely depends upon investment returns as source of income, it’s investment is not compound but inflation rate compounded annually. So individual must have multiple sources of incomes in form of salaries, bonuses, hourly wages, pension and many more it definitely helps as save yourself from inflation.
2.EXPENDITURE OR SPENDING: – It includes all types of expenses an individual incurs related to buying goods and services or any things that is consumable . Expenditures are of 2 types the first one is Controllable and the second one is Uncontrollable. Uncontrollable expenditures are those which you pay each and every month like rent, food, electricity bill, maid, transportation, etc. Controllable expenses are those which you can skip and hold for a particular period of time for example outside foods , clothes, OTT subscription, travelling, unwanted shopping. Living and enjoying life is important but if you take some conscious decisions, it will make you financially better. Your every conscious decision will help you to save money and it may help you in the the time of emergency or you can invest it in some useful manner. If there is excess of expenditure it will definitely affect your portfolio and give edge to inflation.
3.SAVING: – Saving refers to the excess cash that is retained for future investing or spending . If there is a surplus between what a persons earns as incomes and what they spend , the difference can be directed towards saving or investment . managing savings is critical area of personal finance common forms of saving includes physical cash , saving bank accounts and so on . If an individual is totally investing or expending a money there is some risk. There is unique value of liquidity and saving a part of liquidity. Saving or liquid money help us to spot the opportunity and will definitely helps us to beat inflation.
4.INVESTING: – Investing relates to the purchase of assets that are expected to generate a rate of return , with the hope that in over the time the individuals will receives back more money than that they originally invested . Investing carries risk and not all assets actually end up providing a positive rate of return . This is where we see the relationship between risk and return. Common forms of investing includes stocks, bonds, mutual funds, real-estate , private companies , commodities, art and so on. Investment play very crucial role in saving money from inflation. Choosing right investment is always a boon for an individuals….(read more)

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