But he that had received one went and digged in the earth, and hid his lord's money. (KJV): burying looked safe; the master called the servant wicked and slothful. Inflation makes the burial an actual slow loss.
Matthew 25:18The number stays, the value leaks
Inflation is a general rise in prices, which is the same thing, seen in a mirror, as a fall in what each dollar buys. The bill in your hand still says one dollar next year; it just commands less bread, less fuel, less of everything. Money’s second job is being a store of value, and inflation is the slow leak in that store. A little of it is normal in a growing economy; the Federal Reserve deliberately aims for 2% a year, measured on the PCE price index, and as of 2026 that target still stands; where ‘the’ interest rate comes from covers how it tries to hit it. A lot of inflation, as in the late 1970s, can wreck household plans wholesale.
How we measure it: the CPI
The official U.S. yardstick is the Consumer Price Index, built by the Bureau of Labor Statistics. The BLS tracks the prices of a broad basket of the things households actually buy (food, rent, fuel, clothing, medical care) and publishes how much the basket costs compared to before. When headlines say “inflation was 3% this year,” they mean the CPI basket costs 3% more than it did twelve months ago.
The long view is the sobering one. The Minneapolis Fed publishes the CPI back to 1913, and across that century-plus the average works out to about 3% a year, with wild swings around it, from double-digit years in the 1970s to outright price falls in the 1930s. Compounded, that quiet 3% means overall prices as of 2026 are a bit over thirty times their 1913 level. Nobody voted for that in any single year. It accumulated.
A worked conversion
The CPI-U table this site ships (BLS, US city average, all items, annual averages, series CUUR0000SA0) lists 9.9 for 1913 and 321.943 for 2025. Divide:
321.943 / 9.9 = 32.52
A basket that cost $1 in 1913 cost $32.52 in 2025 on that index. That is the “bit over thirty times” above, shown as division. The average annual rate from 1913 to 2025 on the same table is 3.16% a year (112 years, the compound rate that connects the two index levels). “About 3%” is the long-run sentence. It is not a forecast of next year. The inflation time machine runs this division between any two years in the table. A Crash Course episode on inflation and bubbles is on the video shelf; any dollar figure in it belongs to the year it was filmed.
The Rule of 72, running in reverse
Compounding works against buried money exactly as it works for invested money. Divide 72 by the inflation rate and you get the years until prices double, the point where your stored dollar buys half. At the long-run 3% average, that is roughly 24 years. Even over one decade, 3% inflation quietly removes about a quarter of a hidden dollar’s purchasing power.
Which puts the third servant in a new light. “He that had received one went and digged in the earth, and hid his lord’s money” (Matthew 25:18, KJV). Burial felt like perfect safety: nothing could be lost. The master judged otherwise, and inflation supplies the modern arithmetic for his verdict: cash under the mattress is not standing still, it is walking backward at whatever pace prices walk forward. Doing nothing with money is itself a decision, and in an inflating world it is a losing one.
What holds value
If the dollar leaks, what holds? Broadly, three kinds of things:
- Money that earns. Savings accounts and similar earn interest that can offset some or all of inflation; some years fully, some years not. This is the right home for the emergency fund: you accept a little leak in exchange for instant access. See where to keep savings.
- Productive assets. Ownership of things that generate real value (businesses via stocks, land, skills and tools of your trade) has historically been the long-run defense, because their earnings and prices can rise along with everything else. That is the territory of investing, with its own risks and its own lessons.
- Treasure that cannot rust. Jesus’s counsel to store treasure where “neither moth nor rust doth corrupt” (Matthew 6:19-20, KJV) is not a hedging strategy; it is a reminder that every earthly store, whether buried, banked, or invested, is provisional. Generosity and faithfulness are the only holdings inflation cannot touch.
The wise still store ahead, as Proverbs 21:20 pictures. Foresight remains a virtue. But a steward now has to store thoughtfully, because the storehouse itself leaks.
The practice
- Ride the Inflation Time Machine: pick a year, see what your dollar would buy then and now, and watch the leak run at different rates.
- Divide 72 by this year’s inflation rate for your own doubling estimate.
- Audit your “buried talents”: money sitting in a no-interest account beyond what quick access requires. Decide on purpose where each pile should live, and let the deciding be stewardship, not fear.
Try it yourself: open the interactive tool for this lesson.
Before you go
Check yourself
1What does the Consumer Price Index actually measure?
The cost of a broad basket of things households actually buy (food, rent, fuel, clothing, medical care) tracked by the Bureau of Labor Statistics. "Inflation was 3% this year" means that basket costs 3% more than it did twelve months ago.
2At the long-run average of about 3% a year, how long until prices double?
Roughly 24 years: 72 divided by 3, the Rule of 72 running in reverse. Even one decade at 3% quietly removes about a quarter of a hidden dollar's purchasing power.
3The number on a buried bill never changes, so cash under the mattress cannot lose value. Where does that reasoning fail?
The number is not the value. Prices walk forward, so a stored dollar walks backward at the same pace. The third servant's burial felt like perfect safety and the master judged otherwise; inflation supplies the arithmetic. Doing nothing with money is itself a decision, and in an inflating world a losing one.
Do this now
Audit your own buried talents: find the money sitting in a no-interest account beyond what quick access actually requires, and decide on purpose where each pile should live. Let the deciding be stewardship, not fear.