A friend pose this interesting question to me over my concern with inflation eating into our hard earn money. To point out how serious the problem is, i have it structured below.
Let's think of a scenario. I have idle cash of $1M. Considering inflation of 3%, that's 30K loss annually. We know how rich we are is how much we save. Using this basis, if I save 30K annually from my monthly earning, i am just working my arse off just to level up my networth. The curse of being a millionaire ?
Let's go further. For those who are more financially awakened, potential returns may average 5% annually. $1M sitting idle is 50K loss. Has risk adversity reached a new height in stupidity ?
Not surprising for those Savvy Investor who hits 10% return. That's 100K average. If you have this money and they are not working because you are so busy with work, do yourself a favor, sit down and do some Maths. What the hell am I talking ? A Savvy Investor will not have this problem.
Now where am I ...
9th Sept 2015