Present Dearness and Effect on Poor

 

Dearness has effected almost everybody of life. After Covid almost everyone has  suffered this phenomena. Dearness is an evil which has effected poor very much. Dearness has curtailed the ability to purchase anything for poor. Dearness has made life miserable of the poor.

Dearness, also known as inflation, is a pervasive economic phenomenon that has impacted the lives of individuals and communities worldwide. The ongoing COVID-19 pandemic has further exacerbated inflationary pressures, making it a pressing concern for policymakers and individuals alike.

Dearness manifests in the form of rising prices for goods and services, eroding the purchasing power of consumers and potentially leading to economic hardships. In Pakistan, the current inflation rate stands at 23.2%, significantly higher than the global average of 8.1%. This surge in prices has placed a strain on household budgets, particularly among low-income families.

The term "present dearness" can be interpreted in various ways, each with its own implications and potential solutions:

1. Present Dearness as "Present Value of Money":

In financial terms, present dearness refers to the concept of discounting future cash flows to their current worth. Inflation plays a crucial role in this concept, as it diminishes the purchasing power of money over time. To mitigate the impact of present dearness, individuals can consider investing in appreciating assets like stocks or real estate, which have the potential to outpace inflation and preserve their purchasing power.

1. Present Dearness Referring to "Current High Prices":

In this context, present dearness signifies the overall increase in the cost of living due to factors like inflation and supply chain disruptions. To address this challenge, individuals can adopt various strategies to manage their expenses and reduce the impact of rising prices:

• Careful budgeting and expense tracking: Identifying areas where savings can be made is essential.
• Seeking the best deals: Comparing prices and taking advantage of discounts can help stretch the budget.
• Implementing cost-saving measures: Utilizing public transportation, switching to energy-efficient appliances, and considering DIY repairs can lower expenses.
• Growing your own food: If feasible, homegrown produce can reduce grocery bills.

1. Present Dearness in Terms of "Expensive Gifts":

To avoid the burden of expensive gifts, consider these alternatives:

• Thoughtful handmade gifts: These demonstrate personal care and attention.
• Experiences instead of material possessions: Event tickets or charitable donations offer unique value.
• Setting a gift spending limit: This helps avoid overspending.
• Focusing on quality and sentiment: Emphasize the meaning of the gift rather than its monetary value.

Coping with the rising cost of living can be challenging, but these strategies can help alleviate the impact of present dearness:

• Budgeting: Allocate income effectively, prioritizing essential needs over wants.
• Saving and investing: Build an emergency fund and invest in assets that outpace inflation.
• Comparison shopping: Seek the best deals and utilize discounts.
• Cutting unnecessary expenses: Identify and eliminate non-essential spending.
• Increasing income: Explore additional earning opportunities.
• Adapting lifestyle: Adopt cost-saving practices like using public transportation or cooking at home.
• Monitoring inflation rates: Stay informed about price changes to make informed decisions.
• Diversifying income sources: Avoid reliance on a single income stream.
• Negotiating prices: Seek discounts or better deals where possible.
• Planning for the future: Invest in assets that offer protection against inflation.

While these strategies can help manage present dearness, adaptability in your financial approach is crucial to navigate the ever-changing economic landscape.