The Cash In Your Pocket Is Programmed To Lose Value

So, how do you actually save?

Photo by Jp Valery on Unsplash

I give fiat currency a kicking on here because it’s designed to be spent, not saved. Let me unpack this.

Fiat, which covers virtually all government-issued currencies, excels in its liquidity, mobility, and ease of transaction. It’s engineered to zip from one hand to another, maintaining the economic engine’s momentum. But as a store of value? Not so much. It’s inherently programmed to lose value over time — making it the worst contender for long-term holding but the champ of spending.

But our main problem isn’t overspending — it’s under-saving.

Stashing fiat in your bank account is like keeping ice out in the sun — it melts. That’s why the savvy ones among us look to assets that appreciate over time — real estate, stocks, gold. We’re all playing the game where we trade weakening fiat for assets that climb in value over time.

But let’s talk about savings versus investments. Investments generate cash flow — if it doesn’t churn out cash, it’s not an investment, it might be a liability or perhaps a saving. Owning your home isn’t an investment if you live in it and count it in your net worth. It’s more likely a liability, or at best, a form of saving.