Why Should You Care About Inflation?

Why should you care about inflation? We know that inflation is when the prices of many goods and services across the entire economy trend upwards over time. But why should you care? Well, what if we told you that the money in your pocket will be worth less tomorrow than it is today? Would you change what you buy? Would you invest your money in the stock market instead of using a savings account, or would you lose sleep at night? The good news is that most wages and salaries also tend to rise with inflation. This helps people's income stay in line with the prices of goods and services they need to purchase. Where it can get complicated and more worrisome is when prices start increasing faster than wages and salaries. This can be especially hard on people whose incomes don't rise at all with inflation like someone on a fixed income. So who helps keep inflation under control? The Federal Reserve. Catch our next episode to see how.