Is 1 Crore a Lot of Money?

Is 1 Crore a Lot of Money?

I receive such kind of queries many times. In fact, many high school going kids ask me this question. So i thought that I should write a separate post about this article so that you can understand the issue more.

well, 1 Crore is not a lots of money but 1 crore worth of Asset is a lot of Wealth. This is because of Inflation. If you have 1 crore on hand in cash than sadly speaking, it’s not at all the lot of money because the inflation will erode its purchasing power over the time.

But of course, if you are the owner of 1 crore worth of asset such as 1 crore worth of Stocks, Bonds, Business, Real Estate, Mutual Funds or Gold than it is a lots of money. Because Asset will appreciate in its price over the time and keep you rich.

Plus as long as you hold the asset, you will have a steady passive income from your asset that you can enjoy it as long as you hold it.

Remember, After 1971 the world is not following the Gold Standard means the modern money is not backed by Gold. It is only backed by the faith of government only and that’s why governments and central banks from all around the world print money according to the requirements of economy.

Recently, US Government has printed $ 1.2 Trillion out of thin air only which has diluted the purchasing power of the existing money in the circulation worldwide. And that’s why if you have 1 crore money in cash, it’s not lots of money. Because the printing activity of the governments all around the world dilutes its purchasing power over the time.