Post
Topic
Board Economics
Re: Stagnant Salaries vs. Inflationary Savings Tax
by
Mr.right85
on 10/05/2024, 23:54:24 UTC
Which of these economic situations would you prefer to find yourself in?

A- Your salary is stagnant but prices fall. Where this happens, your real purchasing power has increased.  It's called constructive deflation. And even if your salary falls, but prices fall faster, you are still ahead.


B- Having your savings taxed 2%+ a year by inflation.

Drop your thoughts

Of course, A will be a good choice for anyone here, as your purchasing power has increased and obviously you will be living a good life and as you have pointed out, you are still ahead of the game so it will be the logical options. As for B, not sure if others are saving here, but it's not a good option and it's better to just reinvest your money on crypto.
Is the option A ever possible? It’s very much the preferable option but, chances that this is ever possible is zero. I’m fact, the opposite is the case as salary is often stagnant while price of goods and services sky rockets. The option many has used to go around this is finding alternative source of income or increasing your streams of income. It’s the only possible means to survive in such harsh economy.
Option B which requires you to save is the most probable but even so, most people don’t like to be taxed for an already taxed money and that’s what’s obtainable. If we are to be more practical, I would say the later option goes too.