RE: Is Your Money Dying? The Secret Loss of Savings

I wouldn't be me if I didn't add a little extra on this :)

Just for fun, remember the rule of 72. What is the rule of 72? Well, take whatever interest rate you are getting (lets say 7.2%) divide that number into 72 and the result is how long it will take your money to double. 72/7.2% --> 10. In ten years your money will double. Those rupee going 10X higher since 2000 means 9.2% interest rate. A little higher than I would expect from an average return but still possible.

You are correct that money stashed is effectively dead and WILL lose money over time.

However, your elder "ChaCha Deeno" is not entirely wrong in stashing money but there is a better way to do it. Many old school people distrust banks and governments intensely. Putting money into investments they don't understand (which can also go down) is something they can't do with funds that are so important for a future obligation. Yes, GIC and BONDS can be very useful if they are insured but I do not know if the government there offers protection from bank failure.

In the Philippines for example PDIC insures money but only to a maximum of 500,000 Peso, in Canada CDIC to a maximum of $120,000 CAD, if the money is more than that and the bank runs into issues.... You lose.

A possible alternative for those old school people with little to no investment knowledge? Silver or Gold coins. I personally hold both at home, albeit very little gold, because things happen. Silver and Gold have been currencies for thousands of years. Holding them is something physical and something that can be kept safely hidden. No bank. No investments that are hard to understand. Still looks and feels like money....but it isn't based on any country putting a number on a coin, its based by the value in the coin itself.

Just a thought and thanks for writing :)