The money you have in your bank account or wallet right now is about to lose a lot of value. This is not something to be fearful of. Its a concept to understand and learn about, so you can avoid the problem.

It has taken me 10 years of studying money,a career in finance, and many startup failures to understand how money really works, so I can stress less. Only recently did what Im about to explain to you make sense in a practical way I could implement in the management of my personal finances.

You can learn how to get more done in three hours than most achieve in a week and it wont matter. Time equals money, yes but theres more to it.

You can become a passive income badass too and it wont matter unless you get what Im about to explain in the simplest terms youve ever heard it.

very year the inflation target is around 2%. The Federal Reserve in America is looking to change that to 4%, according to CNBC. Other central banks around the world are looking to make similar changes.

The reason why inflation matters to you is that when inflation goes up, prices of the stuff you buy goes up asset prices go up too. Heres the killer idea you need to understand:

Calculating inflation is controversial, according to Investopedia. Inflation is controversial because if people understood it, they wouldnt be happy about how much prices are really rising every year.

Whenever a concept in finance is complex, it divides people into two categories.

The second category have the money they earn eroded away.

Those who understand inflation in real terms do incredibly well I want you to be one of those people, hence this article.

The Simplest Way to Think About Inflation Versus Deflation

Personal finance YouTuber, Graham Stephan, makes the comparison better than many others Ive heard explain it. Im going to take some of his concepts and make them even simpler for you.

The big idea

If you know your money is worth less in the future then youll spend it now.

If you know your money is worth more in the future you wont spend it.

When people spend their money on products and services then inflation occurs. Businesses revenues go up slightly more thanks to inflation and that means they can afford to pay their employees slightly more each year.

When people dont spend money, deflation occurs. Deflation typically happens around or during a recession. A recession means people lose their jobs, your retirement savings get smashed, and banks who hold your money could face financial trouble like they did in the Global Financial Crisis of 2008. When banks face trouble they get bailed out using your tax dollars.

Or the bank can be forced to do a bail-in. This is where all the deposit holders of the bank have a percentage of their savings taken away to save the bank. As a depositor of a bank, you are legally an unsecured creditor in the event they go down.

When deflation occurs and a lack of spending results, prosperity suffers. The rich get richer and the poor get even poorer, leading to inequality that often leads to social unrest.

Deflation leads people to spend less money and save more. When nobody spends money, the economy suffers and businesses like the ones you and I work for start to fire people.

Now you might think central banks like the Federal Reserve in the US can step in and save the day. (Dont fight the Fed they say!)

Heres the difference this time around: the way the Fed manipulate inflation, mostly, is through adjusting interest rates. With interest rates already at zero or below in most countries, they cant pull this lever like they normally do.

The Federal Reserve wants inflation because it helps the economy grow again. As the economy grows and inflation goes up, central banks can raise interest rates again to make people spend less money and control inflation. People who have debt want inflation for this reason. The Federal Reserve wants inflation because America has $26 trillion worth of debt. As crazy as it sounds, inflation can help the US government pay off its debt slowly.

Printing money should fix the problem, shouldnt it?

As weve discussed before, governments can print money out of thin air. When you hear that stimulus checks are going to be handed out, thats just secret handshake talk for printing money.

Printing more money should make people spend more. But what if it doesnt?

What if all the free money that has been and will continue to be handed out isnt spent, its saved? When people are fearful like they are right now, they typically want to save their money, not buy useless consumer goods to get the economy going again.

Printing money is pointless if it doesnt get spent.

And if a government prints too much money then they create hyper-inflation like what happened in Venezuela when their currency inflated 1,700,000% in 2018.

The argument I get about hyperinflation is this: America has the US dollar which is the worlds reserve currency. In other words, there is a huge demand for dollars. The US is mostly immune to hyperinflation.

Now heres where things change again. China and Russia are already planning to abandon the US dollar as the reserve currency. Europe has hinted at doing the same many times.

Oyo State Government will Thursday release the list of the 5,000 successful candidates for teaching positions in secondary schools in the state.

The Executive Chairman, Oyo State Teaching Service Commission (TESCOM), Pastor Akinade Alamu, disclosed this in an interview on Fresh FM Situation Room, a programme on badan-based radio station, Fresh FM 105.9 on Thursday.

Alamu revealed that the process, which commenced a few month ago, has been completed for teaching staff applicants.

He revealed that Governor Seyi Makinde has granted approval for immediate appointment of 5,000 successful candidates who have been interviewed after scaling through written test.

ALSO READ: Adamawa State University Hold Its 14TH Convocation Ceremony (Photos)