Money is a difficult topic to wrap your head around. Many people see money as a static object used to make consumer purchases on a daily basis. Yet money is so much more than a purchasing commodity. Investors use money to generate more of it, and businesses engage in what is essentially speculative behavior in the pursuit of attracting money from others in the future.
As a consumer, it’s your responsibility to get more familiar with the concept of money so that you can leverage yours for smarter and more effective uses. One important thing that you can do is expand your reading and research activities when it comes to financial well-being. Far too many people simply assume that they understand their finances and bank accounts “well enough.” With a research partner like Wealth Rocket (WealthRocket.com) finding the financial information that you need to make great decisions about personal finance, credit scores, and financial goals is simple and all in one convenient place.
While Wealth Rocket offers a one-stop-shop for all things personal finance, these topics are worth speaking about in brief to highlight their importance in relation to your financial goals and personal finance health.
One thing that virtually all consumers understand is the effect of inflation. On a yearly average basis, “money” becomes 1 to 2% weaker as the calendar rolls over. This means that price adjustments occur on a rolling basis, but that each January you can expect an average increase of a few cents added on to everything that you purchase regularly. Milk, meats, and other grocery store staples, current model year cars, and the medication and supplements that you take each morning all get just a bit more expensive every year.
In order to combat inflation, businesses often provide cost of living raises to their employees each year, boosting their paycheck by a few percent—in addition to occasional performance-based raises that provide a measure of stability and corporate satisfaction among workforces. Yet, if you’re waiting for your employer to manage the continuous march of inflation on your wallet for you, you’re making a crucial mistake. In order to manage this economic fact of life, many people turn to savings schemes to protect their capital against a weakening purchasing power that settles over immobile pools of cash.
A great way to beat the rising cost of inflation is through investment assets. Savings accounts are growing weaker over time, and only a few online banks, credit unions, and other savings account options now provide enough growth power in the form of a high dividend interest rate to defray the cost of inflation on your yearly budget.
Many people put aside their emergency fund in a credit union or online bank savings account, but any savings aside from this pool that must remain fluid should be placed in the stock market or another commodity trading space in order to prioritize the return on investment over liquidity. Interest rates are falling through the roof on personal capital, and coupled with increasing credit card interest rates, Americans, Canadians, and all others are really feeling the squeeze on their free capital.
Investing in the market is a great way to challenge the prevailing market conditions that are affecting your ability to maintain your standing in your community. Financial health is more challenging than ever these days. With continued shocks to supply chains as a result of COVID-19 and increasing joblessness all around the world, consumers have to take it upon themselves to find an online savings account and other financial products that suit their needs now more than ever.
With these topics in mind, get started prioritizing your personal finance goals today.