Saving Money in a Bank Account? You Might Be Slowly Donating It to Inflation

You’re saving money. You’re being responsible. You feel kind of proud seeing that account balance climb.

But here’s the uncomfortable truth: if inflation is 3 percent and your bank account gives you 0.65 percent, you’re not growing wealth. You’re quietly donating it to the economy. A kind and selfless gesture. But maybe not ideal.

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What is inflation, really?

Inflation is the rise in the general cost of living. It doesn’t mean everything gets more expensive at once, just that your money slowly loses its buying power.

Like your salary at the supermarket. Or your patience by 4 PM.

If 100 kronor buys you a week’s worth of bananas today, it’ll buy you five and a half sad ones next year. That’s inflation.

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What banks actually give you

Swedish banks are famously chill. Polite customer service, clean branches… and savings rates so low they might as well be decorative.

• Most accounts: 0.5–1.0% interest
• Inflation: 2–3%

Your money is getting lapped.

Example:
100,000 kronor in a savings account at 0.65% interest.
Inflation at 3% = you effectively lose ~2,350 kronor in purchasing power per year.

Your money is sitting there, doing yoga, sipping tea, and slowly becoming worth less.

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“Safe” isn’t always safe

We’re told banks are safe. And sure, they don’t crash and burn like crypto scams.

But safe doesn’t mean immune. Money that sits too long in a low-interest account is like a snowman in April. Still technically there, but smaller every time you look.

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So what should you do instead?

You don’t need to throw everything into the stock market tomorrow. Just move the money you won’t need for the next 1–2 years into something with a chance to grow.

In Sweden, that usually means:

• Open an ISK (investment savings account).
• Invest in low-fee index funds.

It’s not exciting. It’s not flashy. But it beats watching your savings deflate like a party balloon two days after your kid’s birthday.

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Final thought

If your money isn’t doing anything, it’s still doing something.

It’s losing value.

So… How Much Should You Keep in a Bank Account? And Where Should the Rest Go?