What can we, as consumers, do to combat its effects?
A most surprising and interesting fact about life is that we are losing money every single day. It doesn’t matter whether someone is taking any false steps with their money or not. They will be losing their money regardless. Is this not a matter of concern?
We are doing nothing wrong with our money but, every day, it continues to go out from our hand and into someone else’s pocket.
How is this possible, you ask? For understanding this, it is not very important to learn economics or finance.
One just needs to be familiar with inflation. Yes, that confusing and frightening topic of inflation.
Inflation is an alarming issue for everyone in our country.
Whatever money people may end up saving every month for future use, we are unable to use or utilize that whole money in the future.
Due to inflation, we are losing the value of money every day. Most countries are fighting with this issue. At present, the inflation rate hovers at about 5% in Bangladesh.
So the question arises: What can we, as individuals and consumers, do to combat the threat of inflation?
The very first answer that comes to our head, perhaps, is that we can keep our money in the bank. Though this is a good way to save, it is certainly not the best.
Banks on an average provide interest rates of around 3% in Bangladesh.
So, subtract that from the inflation, and thus, we can see that we are still losing money. There has to be a better way to save more of our money.
While we cannot lower the inflation rate ourselves, maybe we can reduce our overall cost through other means. But before that, let’s see some of the factors which contribute to the increase in prices for the average consumer.
A particular point of focus in this conversation is the “middleman.”
For example, it is the middlemen who are taking goods from poor farmers at a very low price and selling them to buyers at a high price.
Farmers aren’t getting the full value of their products due to this vast gap between the seller and the eventual buyer.
And the middlemen continue to make money without doing anything of much significance.
The question arises: Is it possible, then, to reduce the gap between the buyer and seller and remove the middleman completely?
Maybe we can educate farmers so that they are more aware of market prices, so that they can sell their own goods to the buyers directly.
The buyers too need to know about the updated market prices, and perhaps using the power of digital media, through apps which provide updated prices, we can ensure a more efficient system which keeps costs to a minimum.
This could, potentially, eliminate the hidden cost of inflation which we have to pay.
Tanvir Rafi is a freelance contributor.