Decoder · How growth works

Inflation

The slow rise of prices that makes idle cash lose buying power — roughly, money under the mattress shrinks a few percent a year in what it can buy. Inflation is the quiet reason 'just save it' is not a retirement plan: savings accounts fight it to a draw; investing exists to beat it over long periods, accepting swings as the price.

For your first $100: Your first $100 in a savings account is well placed for emergencies. Your first $100 meant for thirty years from now has to outrun inflation — that is the entire case for investing, in one sentence.

Return, in plain words Compound growth, in plain words Dividend, in plain words

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