Why Is Inflation Sometimes Good for You?

Inflation is like when your allowance goes up, but the price of candy also goes up. Sometimes, this helps people who owe money or want to buy things later because everything will be more expensive then. It’s like a hidden surprise for some people.

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Examples

When your mom borrows money from the bank at a low rate during inflation, she uses it to start a new bakery, and you get more cookies to eat.
Your grandma’s pension is fixed, but because of inflation, she can’t buy as many eggs as she used to. But your dad’s company gets cheaper loans, so he expands his business.
Inflation makes the price of toys go up, but it also means you can borrow money from your uncle at a lower rate, and you get a new bike for Christmas.

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Categories: Economics · inflation· economics basics· money growth· consumer behavior