Secrets Of Inflation
Inflation is often portrayed in the media as a bad thing, however, it is a necessary ingredient for our lives to operate in a smooth manor. While none of us likes paying more for products, inflation, in and of its self is not necessarily a bad thing. For example, stock market beginners need to know in real estate inflation allows our home value to increase while the payment remains fixed.
The following example shows how inflation can actually be helpful.
Rob and Mary bought a little house in 1991 for fifty eight thousand dollars. Their payments, including taxes and insurance were four hundred forty dollars each month.
In the summer of 2006, Bob and Marie were thinking of selling their home and had it appraised. The value of the home was appraised at two hundred eighty seven thousand dollars. Bob and Marie had a house payment at this time of four hundred and sixty dollars.
Inflation has been helpful to Jack and Sue. Not only has the value of their home grown, their take home pay has doubled and their home payment has remained almost the same.
Recently, Rob and Mary had their home reappraised. Due to the economic conditions in the United State of late the home is now only worth one hundred fifteen thousand dollars. Their house payment remains exactly the same as it was in 2006, but the home has lost almost half of its value form 2006. The lack of inflation has caused Rob and Mary to lose net worth. Unless the economy turns around and we begin to have some inflation once again, their property will continue to lose value.
Runaway inflation is hurtful for most people. For those on fixed incomes, it is especially difficult. However, some inflation helps our lives to flow smoothly.
What we really desire is to see balanced inflation. The prices of things grow gradually along with our paycheck as well as the value of our property. - 23167
The following example shows how inflation can actually be helpful.
Rob and Mary bought a little house in 1991 for fifty eight thousand dollars. Their payments, including taxes and insurance were four hundred forty dollars each month.
In the summer of 2006, Bob and Marie were thinking of selling their home and had it appraised. The value of the home was appraised at two hundred eighty seven thousand dollars. Bob and Marie had a house payment at this time of four hundred and sixty dollars.
Inflation has been helpful to Jack and Sue. Not only has the value of their home grown, their take home pay has doubled and their home payment has remained almost the same.
Recently, Rob and Mary had their home reappraised. Due to the economic conditions in the United State of late the home is now only worth one hundred fifteen thousand dollars. Their house payment remains exactly the same as it was in 2006, but the home has lost almost half of its value form 2006. The lack of inflation has caused Rob and Mary to lose net worth. Unless the economy turns around and we begin to have some inflation once again, their property will continue to lose value.
Runaway inflation is hurtful for most people. For those on fixed incomes, it is especially difficult. However, some inflation helps our lives to flow smoothly.
What we really desire is to see balanced inflation. The prices of things grow gradually along with our paycheck as well as the value of our property. - 23167
posted by X - Men @ 9:29 AM
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