MONEY TIP OF THE MONTH – Your savings will erode if you’re not investing
Burying cash in coffee cans in your yard is a terrible long-term investing plan. If it manages to survive the elements, it will still be worthless given enough time.
If your money isn’t growing, it is losing purchasing power to inflation, the rise of prices over time. For instance, you’d need $288 in 2014 to buy the same stuff you could get for $100 in 1980, according to this Bureau of Labor Statistics inflation calculator.
Inflation has been about 3 percent a year or less for the past 20 years. The Federal Reserve Bank suggests that your savings must earn a minimum of 3 percent a year just to retain their current value.