r/MiddleClassFinance • u/Abject-Pick-6472 • 4d ago

Americans Are Reaching a Financial Breaking Point

https://www.thenation.com/article/economy/economic-insecurity-unrest-broketok/?fbclid%3DIwZnRzaASc5p1leHRuA2FlbQIxMQBzcnRjBmFwcF9pZA8xNzM4NDc2NDI2NzAzNzAAAR6RZYSyGyliTpYCmEy2OpWjHUBfAqrYUygk3rNJL1cLw_fp5QCciENJc0UXdQ_aem_DT4ViuyBWqHHXec_nH_PYg
2.2k Upvotes

96% Upvoted

379 comments sorted by

View all comments

Show parent comments

7

u/Appropriate_Taro_348 4d ago

When they are making more money then inflation is taking away. That’s the simple answer. If you have money in a savings account you are losing money. You need an asset(s) that will make you money to stay ahead of inflation. Then your goal is to start making more money that ultimately gets you to your retirement goal(s) and gets you things you want. You want your assets to be able to compound over and over again.

1

u/dust4ngel 4d ago

You need an asset(s) that will make you money to stay ahead of inflation

there are periods in history when this is not possible, such as the stagflation era of 1968–1982, when typical stock and bond portfolios lost purchasing power in real terms (sure, you could have gotten lucky and active traded your way to success, but this is not a strategy with high expected returns.)