When prices rise over time, so the same money buys less.
A little inflation is normal, and the Federal Reserve aims for about 2% a year. When it runs high, paychecks and savings buy less, which is why it shapes so many elections.
"With inflation at 6%, a $100 grocery trip costs about $106 a year later."
Filed under money and the economy in the glossary, with every word used on How I Lean.
Nine questions, about three minutes, and you'll see where you lean.