In a nutshell, inflation is a general increase in prices and fall in the purchasing value of money. The phenomenon of inflation is not only a business trouble. It’s a problem for all of us.
It does not matter where you live. It doesn’t matter whether your country is rich in economy or poor. It’s disease that affects all of us.
But at this point in time, there’s deflation. Countries around the globe are battling to deal with Cov19 pandemic. What they do they resorted to stimulus packages.
Which means they’re printing money trying to save the world from financial crisis that was brought about by the pandemic. Soon post Covid 19, we will soon experience inflation the world has never seen before
How to beat inflation?
At most we don’t worry much about this phenomenon as individuals. all what we know is that it’s business or government responsibility. We live our life without taking note of it. Let me give you an example. If a government wants to establish a project, it must look for revenue resource to fund it. The primary revenue source is the tax revenue.
It’s either to increase certain tax revenue or to create a new one. Who will pay for such increase? Its definitely me and you. The increase in taxes means that your salary or business profit will decrease by a certain amount..
Same goes for business, If the government increases business tax, the business entity will increase prices to cover the shortfall. The increase in prices will in turn decrease your income (salary).
Is your salary adjusted in order to keep up with inflation?
The answer is overwhelmingly no. We don’t cater for this eventuality. We continue living our financial life as normal. Only when we realize that the money we have no longer cater for our family financial needs, it’s then we start thinking about alternative source of income.
A word of warning you need to take care of the effect the inflation does to your income. You must do so every year. You must plan ahead. A 1 to 3 year plan is appropriate. You may tell your boss to look at your salary during the past 2 years or something and consider adjusting your salary/income accordingly.
If it doesn’t work or he/she ignore you, consider alternative income source. The best strategy is to consider setting up a small business for yourself. A vending machine to sell any product will help you going forward.