As those who lived through the late 1970s and early 1980s can attest, inflation can be a “wealth killer” because it erodes purchasing power. Inflation revved up to 7% in December’21 compared to the year prior, the highest level in decades. Even at 3% annual inflation, in 20 years you would need $181 to match what $100 buys today, according to the calculator at fintech site SmartAsset.
Now this got me thinking if I own things that can outperform an inflation of 7% per year!
I bought my first house in 1994 in Johor Bahru for 135K and now the bank value is about 600K that’s a 5.47% per annum growth rate. Fail!
Then I bought my first gold chain when I started working for 400 and now at current gold rate its worth 3300 that’s a 11.13% per annum growth rate. Pass!
My first car was a second-hand old car I bought for 15K cash some 15 years ago, and now nobody wants to buy it. It’s used to dry my carpet on the weekends!
Can we survive inflation?
LIC Editor
Learning Investors Community – Series 4
Source: https://smartasset.com/investing/inflation-calculator