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Making Ends Meet

English For Israel Making Ends Meet

Making ends meet during inflation becomes significantly more challenging for us, especially for those with fixed incomes or limited financial resources.

While some level of inflation is considered normal and even necessary for a healthy economy, high or unstable inflation has negative consequences for society, impacting purchasing power, economic stability, and wealth distribution.

Decreased Purchasing Power When prices rise, the purchasing power of our money declines. This means that the same amount of our money buys fewer goods and services, making it more difficult for us to afford the same standard of living. Higher prices for essential goods and services such as food, housing, healthcare, and transportation strain household budgets, particularly for items that are necessary for daily living.

Impact on Savings and Investments Inflation erodes the value of savings and investments over time. If the rate of inflation exceeds the rate of return on savings or investments, you may find that your wealth diminishes in real terms, making it harder to achieve your financial goals and cover unexpected expenses.

Fixed Incomes Individuals on fixed incomes, such as retirees living on pensions or social security, are particularly vulnerable to the effects of inflation. Even if their income remains constant, inflation reduces their purchasing power, forcing them to cut back on expenses or dip into savings to make ends meet.

Debt Burden For individuals with debt, inflation has mixed effects. While high inflation erodes the real value of debt over time, it also leads to higher interest rates and borrowing costs, making it more challenging to repay our loans and credit card debt.

Impact on Housing Inflation drives up the cost of housing, including rents and mortgage payments. This makes it harder for us to afford adequate housing, and creates housing insecurity or homelessness in extreme cases.

Unemployment and Income Inequality Inflation exacerbates unemployment and income inequality, particularly as wages fail to keep pace with rising prices. Individuals with lower incomes or less job security struggle to make ends meet as inflation erodes their purchasing power.

Inflation, as we all are experiencing, places significant financial strain on us.

We have all had to adjust our spending habits to cope with the challenges of inflation and maintain financial stability. While government policies play a significant role in mitigating the impact of inflation, or are we better off doing it ourselves without their interference? Unfortunately that option isn't available.

English For Israel

אנגלית מקצועית בקצב שלך, בזמן שלך ובדיוק איך שאתה צריך


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