Saving money is smart — but saving without understanding inflation? That’s risky. Over time, inflation eats away at your money’s purchasing power, making your ₹10,000 today worth less tomorrow.
At Vizzve Finance, we help you protect and grow your savings with the right financial strategies. Here’s a simple breakdown of how inflation impacts your long-term savings — and what to do about it.
📉 What Is Inflation?
Inflation is the rise in the price of goods and services over time. It means your money buys less than it used to.
For example:
In 2010, ₹100 could buy 10 cups of tea.
In 2025, the same ₹100 may only buy 5.
Inflation typically ranges between 4–7% in India annually
📊 How Inflation Erodes Your Savings
Let’s say you save ₹5 lakh in a savings account at 4% interest.
If inflation is 6%, your real return is -2% (your money is losing value every year).
Here’s what ₹5 lakh becomes in real value over 10 years at 6% inflation:
| Year | Nominal Value | Real Value (₹) |
|---|---|---|
| 1 | ₹5,00,000 | ₹4,71,700 |
| 5 | ₹5,00,000 | ₹3,73,800 |
| 10 | ₹5,00,000 | ₹2,78,800 |
🔻 You lose over 44% in purchasing power in 10 years if you don’t beat inflation.
🧠 Why You Must Beat Inflation
To preserve and grow your wealth, you need to earn more than inflation through:
Smart investments
Diversified asset allocation
Financial planning tailored to long-term goals
💡 Vizzve Finance helps customers find the right products to stay ahead of inflation.
✅ Smart Ways to Beat Inflation
1. Invest in Higher-Return Instruments
Savings accounts and FDs may not be enough. Consider:
Mutual funds
SIPs (Systematic Investment Plans)
PPF or NPS
Stocks (for high-risk tolerance)
2. Start Early with Compounding
The earlier you start, the more time compound interest has to work in your favor.
A ₹2,000 monthly SIP started at age 25 can grow to over ₹1 crore by 60!
3. Review Goals Annually
Inflation also affects:
Retirement planning
Education costs
Wedding expenses
Update your goals every year based on inflation-adjusted values.
4. Use Inflation-Indexed Products
Some government schemes offer inflation-linked bonds, which adjust returns as prices rise.
📌 Real-Life Example
Goal: Save ₹20 lakhs for your child’s education in 15 years
Assumed Inflation: 6%
Future Cost: ₹48+ lakhs
What to Do: Invest in long-term instruments (like SIPs or balanced funds) that generate 8–12% CAGR
👉 Let Vizzve Finance help you run future value calculators and find the right investment strategy.
🙋♀️ FAQs
Q1. How does inflation directly affect savings?
Inflation reduces the purchasing power of your money, meaning you can buy less with the same amount over time.
Q2. Are fixed deposits safe against inflation?
Not always. Most FDs offer returns below or equal to inflation, which means your wealth doesn’t grow in real terms.
Q3. What are some inflation-beating investments?
Equities, mutual funds, SIPs, gold, real estate, and inflation-linked bonds can offer better protection against inflation.
Q4. How does Vizzve help with long-term financial planning?
Vizzve offers expert tools and advisors to help customers create inflation-proof saving and investment plans.
published on 2nd july
Publisher : SMITA
www.vizzve.com || www.vizzveservices.com
Follow us on social media: Facebook || Linkedin || Instagram
🛡 Powered by Vizzve Financial
RBI-Registered Loan Partner | 10 Lakh+ Customers | ₹600 Cr+ Disbursed.