Though I’ve alluded that inflation is bad for us, we haven’t given this insidious scourge the attention it deserves. Inflation is like the decay you find in an aircraft engine that hasn’t flown enough.
High Finances: The Engine Decay of Personal Wealth
Finance expert and pilot Jason Depew talks about inflation, how much it can cost you, and how you can fight back against it.
Key Takeaways:
- Underutilized aircraft engines degrade significantly over time, making "years since overhaul" as critical to their health as "hours flown."
- Inflation similarly erodes the purchasing power of idle money through a continuous cycle of rising prices, effectively devaluing savings.
- To combat the corrosive effects of inflation, actively investing money (e.g., in an S&P 500 index fund) is essential to achieve returns that outpace price increases.
- For aircraft owners, forming partnerships ensures regular flying to prevent engine decay and distributes costs, analogous to how investing combats monetary decay.
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