2022 has greeted us with the dreaded soaring inflation. Electricity seems more like a luxury good than an essential service and, due to the energy and supply crisis, the price of basic consumer products, the so-called CPI, has not stopped rising either. How will families cope with this disproportionate increase? Senior Product Manager Jordi Sánchez explains. 

Europe has reached 4% inflation, a historic figure, especially if we take into account that the European Union (EU) sets a maximum of 2% for the economy to function properly. As the National Statistics Institute (INE) has pointed out, the rise in gas, electricity and petrol prices is already beginning to have a serious effect on the CPI. Inflation is causing so much concern that, as a matter of fact, this December all EU energy ministers held an emergency meeting. But how does all this inflationary context affect families?

To begin with, Sánchez points out, it all translates into a loss of purchasing power: in addition to the low return that traditional banks give on deposits, prices are rising. “As everything is more expensive, but the money we have in our account is the same, so we are losing money,” he argues. At the same time, this inflation affects, for the same reason, salaries, which have not increased at the same level as the cost of living. And this chain crisis, it is clear, also affects pensions and, on the rebound, state investment.

Macroeconomic logic would say that, in this situation, the best thing to do, if you cannot make your savings profitable, is to spend them on all the material goods you need. But, obviously, this can lead to waste. That’s why the senior product manager warns that we should always invest in a product that matches or exceeds this increase in inflation. “If there is 4% inflation, you have to look for products that have also risen or will rise by that percentage,” he says. 

It is in this sense that many savers who want to try new things opt to invest in the stock market or diversify their savings, a risky financial operation that, even so, does not ensure achieving this percentage increase in income. For the more conservative profiles, Sánchez recommends drawing up a family budget to try to control spending. But there are many other solutions, and if you want to know them all, watch the video below!

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