If your salary as an entry-level graduate in 2013 was N100,000.00, and your salary as a senior manager is N450,000.00 in 2023—a 450% increase—your purchasing power remains the same. The time value of money -TVM- has affected the amount, therefore you might not be able to accomplish more with the money now than you could ten years ago.
In 2013, a bag of rice cost N12,000.00. The identical 50 kg bag now costs N55,000.00 in 2023. Sadly, the eight bags is still what could be purchased by you.
However, because we still have complete control over some locally produced food lines, there may be other items like garri that inflation hasn't had as big of an impact on.
However, rice is still primarily imported, and many others that are essential to our daily lifestyles.
The only way to get our money value back is to massively produce the quality version of what we consume and give the imported ones THE CHASE OFF our dining tables.
That is, of course, if we really want the N450,000.00 to be able to purchase at least 30 bags instead of the 8 bags it is doing today.
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See another sceranio below:
Recognising the Value of Money Over Time (TVM)
Because money rises over time after it is invested, investors would rather receive money now than the same amount later. For instance, interest is paid on funds deposited into savings accounts. With time. That's the power of compounding interest.
https://www.investopedia.com/terms/t/timevalueofmoney.asp
However, with inflation at all time high, all the benefits of investment will be eroded by degenerating the Time Value of Money -TVM- .
Your N100,000 with compounding interest in 10years is now N600,000 but could only buy 3 extra bags of rice today, that is 11 bags @ N55,000.00.
WE MUST massively produce the quality version of what we consume and give the imported ones THE CHASE OFF our dining tables.
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