Your bank pays 1% a year. Prices rise 3%. Your money grows in euros and shrinks in what it buys. The difference, 1% minus 3%, is the real rate.
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Interest adds euros. Inflation takes away what each euro buys. Only the part left after prices is a real gain.
€10,000 at 1% for 10 years becomes about €11,000. With prices up 3% a year, that buys what about €8,200 buys today.
A savings account that “never loses” can lose 2% a year. It just never shows a minus sign.
Your bank shows the yearly rate on your savings. Put it next to this year’s inflation for your country: if inflation is bigger, your savings are shrinking.
The bank’s rate minus inflation is what you really earn. Below zero, your savings shrink.
Do it today
Compare your savings rate with inflation.
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