If you're not investing, you're losing money. And I don't mean that you're losing out on opportunities for strong investment returns. Certainly, that's true, too, in a bull market like this one. No, you are losing money. Period. That's due to inflation, of course, a nefarious force that slowly erodes the buying power of your money. In the current environment, the problem isn't that inflation is high. In fact, it's actually low by historical standards. The consumer price index (CPI), which measures inflation, is up just 1.4% over the last 12 months, according to data from the U.S. Bureau of Labor Statistics. Of course, that's an average of price increases on goods U.S. consumers buy, excluding food and energy, which are more volatile. And the prices of some items are rising much faster. For example, used cars and trucks are 12% more expensive today than they were two months ago. The real problem with saving money in a bank account or a certificate of deposit (CD) instead of investing it in the market is that the interest you earn on your money today is next to nothing. The average interest rate on an ordinary savings account is around 0.05% today, which is historically low. CDs pay a bit more - 0.85% is typical - but it's still paltry. Inflation is outpacing those rates. And so, by definition, you are getting poorer if most of your money is in a savings account. Here's an interesting graph from J.P. Morgan Asset Management. It shows the income earned from $100,000 in a cash account since 1994 and the level it would take to keep inflation from decreasing your purchasing power. As you can see, for many years a savings account paid enough interest to keep inflation at bay. This is not so anymore. That's primarily due to a decade of low interest rates by the Federal Reserve. And as I mentioned, inflation on some items is much higher than the average. Those include healthcare and education. If you're saving for tuition or future medical care in a bank account, you're really losing money. You would need to earn about $4,475 on your $100,000 to keep up with healthcare inflation, and $1,742 to keep up with education inflation. If that concerns you, it may get worse. Many analysts - including our own Income Strategist Marc Lichtenfeld - predict that all the monetary and fiscal stimulus being created by the government and the Fed right now is going to send inflation much higher, which will erode your savings much more rapidly. Of course, putting money into stocks comes with risk. That is true by definition. But there are smart ways to beat inflation and keep your wealth building, not cratering. And now - today - is a good time to start. It's earnings season, when companies report their third quarter results, and it's a time when stock prices can move dramatically. So don't delay. Our experts have a plethora of great investing ideas for you. Forget that savings account and jump in. The water's fine! Enjoy your day and stay safe, Matt P.S. And if you want to make your money work for you, Bryan Bottarelli is the man with the plan. He's on a mission to get you money just by looking for your name in lists of unclaimed property being held by the government. Once you have some extra money, what's the best thing to do with it? As you've just read, invest it, of course! And Bryan's new Trade of the Day Plus research service is the best, easiest and most inexpensive way to learn how to start. Just click here to get all the details you need. | 
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