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The inflation definition is that money you have today loses value over time. It’s a hidden cost because it happens silently without an announcement and the amount of money in your bank account hasn’t changed. It’s effectively a hidden tax that silently whittles your dollars away.

It’s a real problem because when enough time passes, you can lose tremendous amounts of purchasing power. It takes twice as much money to buy the same goods as it did in 1990, for instance. This is why it is important to invest your money into assets that will provide a real, after-tax return instead of putting your money under your mattress.

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