Zurich Private Capital Inflation is simply a measure of how prices are increasing. But the problem is as prices rise, the amount you can buy with your money decreases. So unless the returns you are receiving on your savings is above inflation then the spending power of your savings is being reduced. While low interest rates are good for borrowers, when inflation remains high; it come at a price for savers especially as the average savings account is doing much less than 2.8%.
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