What if your 1 crore flat quietly dropped to 90 lakh in value—and you didn’t even notice? Akshat Shrivastava, founder of Wisdom Hatch, says this is already happening, not just to homes but to your savings too.

In a post on X, he warns that money is losing its real worth because of something called currency devaluation. “Imagine that your 2BHK flat is worth 1 crore. The next year, its value falls to 90 lakh. How would you feel?”

He added, “What if I tell you: this is actually happening; without you even taking a note of this. One key way this happens is called the devaluation of your currency.”

WHAT IS CURRENCY DEVALUATION?

In simple words, it means your money is losing value. Earlier, currencies used to weaken compared to each other. But today, they’re also losing value against things like gold, Bitcoin (BTC), and other limited-supply assets.

Why does this happen? Because governments can print unlimited money and they are doing exactly that. “Governments right now can print as much money as they wish. And, guess what? They are doing it,” he explains.

This practice has been notably observed with the US Federal Reserve’s actions post-COVID, where 20% of the country’s money supply was printed within a year. “If the rate of money printing is 10%, and your post-tax deposit rate is 6%, your money is losing 4% of its value each year,” Shrivastava explained.

With many individuals distracted by daily life, Shrivastava argues that most remain oblivious to these economic shifts. “People don’t protest. Because most of them don’t bother with economics. Cricket and politics keep them busy.”

To combat this erosion of wealth, he advocated for investments in assets that resist inflation. “Stocks, (good quality) real estate, gold, and Bitcoin are all hedges,” he wrote, though he cautioned that even these are not foolproof if mistimed. Citing Bitcoin, he noted, “If you would have bought BTC on its 2021 high, you would have made 0% returns for 3 years. This is despite the fact that BTC is an asset that the CAGR on BTC over the last 10 years has been 88%.”

The real challenge, according to Shrivastava, lies not only in selecting the right assets but also in knowing how and when to act. He observed, “Problem is most people don’t know how to execute these points: What assets to buy when, how to analyse value, how much to buy, how much cash to keep on the sidelines and how to book profits and rotate capital.”

Ignoring inflation risks while defending a favourite asset class could lead to significant losses. He warned, “People are too busy proving that their ‘asset class’ is the best! As a result, every year, their wealth keeps going down (in real terms).”