Procrastination And Inflation Steal Our Wealth Through Time. Ever Wondered How?
I never quite connected the dots until I read Maria Rattray’s story. While she focused on procrastination for her story, my mind kept telling me there is a parallel with inflation. As I sat at my working desk this morning scribbling, I thought the parallels are deep and uncanny. These are my thoughts.
I thought long and hard about procrastination and inflation. Before I get into my thoughts for this story, this is Maria Rattray’s story I was referring to.
Procrastination is a mystical natural force. At least, it is for me. However, if we actually think about it, procrastination revolves around these 3 pillars.
Pillar 1 — Instant Gratification.
We want to have fun. And we want to fun now. That includes watching Netflix, playing World Of Warcraft, endlessly liking, and commenting on social media posts.
There is a heavy element of hedonism in our daily pleasure-pain spectrum. There is too much mental friction associated with hard work, and no one in their right minds inflicts pain upon themselves.
Except for Olympians who are taught a high-performance mindset.
Pillar 2 — There Is A Limit For Today, And Tomorrow Is Endless.
We are comfortable delaying our work till tomorrow because … the string of tomorrows never ends. In truth, it only ends when we expire biologically.
In a warped way, today is like a limited edition. January 4th, 2021 exists once in our lifetime calendar, and it will never be back again unless there is a major timeline reset.
As of this point of writing, 21,600 seconds have past and a total of 64,800 seconds remain. We must not waste today, am I right?
And so, we prioritize today with “Work-Life Balance” over accumulating assets that last a lifetime.
After all, building things that last take a long time, and we have a long string of tomorrows to do that.
Pillar 3 — Overcoming An Invisible Inertia.
Procrastination is like the Natural Force of Gravity. We cannot see it, and yet it impacts us in profound ways. Ever try to design a product that goes against the Law of Gravity? I guess no one does that unless we are in the aviation business.
Procrastination exists because the energy requires to overcome inertia is too high. I want to be at my desk to start working on that 10,000 words dissertation paper. The thought of sitting for hours without end typing the entire today away alone is a form of barrier to work.
So, instead of heading to the working desk, my mind dispatched me to the kitchen for a cup of coffee.
In a way, procrastination pushes us to focus on today. However, it has a heavy slant towards hedonism and/or zero productivity.
It punishes us in the future because every fruit of prosperity we get to enjoy today is the cumulative result of our past efforts. If it takes 4 years to graduate from Harvard University and subsequently decide to take a term break of 6 months, we will finish school in 4.5 years.
Life is fair.
And not quite.
Because youth forgives what old age punishes.
Take, for instance, Olympian swimmers.
There is every reason that talent is scouted at a young age. They are done by 30 years old. There is a huge difference starting at 12 years old, training for 10 years, exiting by 30 years old and starting at 15 years old, training for 10 years, exiting by 30 years old.
What is that difference?
The talent starting at 12 years old gets to participate in the Olympics 3 times (maximum) between 22 years old and 30 years old before their body breaks down.
The talent starting at 15 years old?
A maximum of 2 times.
It is a world of difference. Procrastination is indeed expensive when measured against our potential to realize great results in the future.
The direct way to combat it is to work hard today.
This is how procrastination steals our future wealth. It does that through time.
This is the same for inflation.
John Maynard Keynes once mentioned that Inflation is a stealth tax. In his exact words: -
“The best way to destroy the capitalist system is to debauch the currency. By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. — John M. Keynes.”
That is, if, we choose not to do anything about it.
Inflation is like procrastination. It works at its maximum capacity when we do nothing. Everyone thinks nothing about 2% inflation. The impact is too meager for us to be bothered. No, I disagree.
To accurately assess the impact of inflation on our savings, consider the following example of a 2% annual inflation, year-on-year, for 3 years.
Savings in the piggy bank: $100.00
An inflation rate of 2% in Year 1: $2.00
Effect on Savings at End of Year 1: $100.00 — $2.00 = $98.00
Not painful enough? The party is not over.
Savings in the piggy bank at Start of Year 2: $98.00
An inflation rate of 2% in Year 2: $1.96
Effect on Savings at End of Year 2: $98.00 — $1.96 = $96.04
Savings in the piggy bank at Start of Year 3: $96.04
An inflation rate of 2% in Year 3: $1.9208
Effect on Savings at End of Year 3: $96.04 — $1.9208 = $94.1192
In terms of effective purchasing power, we lost a total of $100.00 — $94.1192 = $5.8808 over 3 years by leaving our money in the piggy.
Has the cash and coins shrunk in size?
No.
Has the piggy lost weight physically?
Not at all.
Is it painful watching our savings debased?
Of course.
The invisible hand of inflation is against its magic. Against us. Working to steal our wealth, 2% at a time.
What Are The Direct Similarities Between Procrastination and Inflation?
Just like procrastination, inflation is another invisible force at work. In my opinion, what we cannot see is usually more dangerous than what we can. How to prevent a road accident when the car is invisible?
Just like procrastination, inflation cannot be left alone. They are termites to our savings. They chew away our savings today and future spending one bite at a time. Before we know it, a giant portion of our nest egg is gone.
Just like procrastination, inflation is unavoidable. That said, we can overcome it. We have to work hard to increase our incomes, build multiple income streams, and increase our portfolio asset values.
My Simple Takeaway.
To combat the negative impact of procrastination and inflation — We have to work hard today for our future.
There is 1 solution when it comes to building our wealth prosperity tree and preventing it from dying.
Focus on working hard today.
We will have a chance to survive till the day we expire.
That is because both procrastination and inflation work on the side to steal our wealth through time.
We got to run slightly faster to stay ahead.
Get Prosperous And Then Work To Protect Our Wealth!
Aldric
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