Lesson 3 of 8 · 3 min

How fiat devaluation actually works

The slow tax most savers never see itemised.

Devaluation rarely arrives as a headline. It accumulates: each year of inflation above the savings yield is a quiet transfer from cash holders to debtors and asset holders.

Over a 30-year horizon — the natural horizon of a generational trust — even modest annual devaluation compounds into a majority loss of purchasing power for cash positions.

Trust structures cannot stop devaluation, but they can decide *what* the trust holds and *how* it is governed so that the loss is not borne entirely by the next generation.

Self-check

3 quick questions

Q1. Over 30 years, 3% annual inflation reduces the purchasing power of cash by roughly…
Q2. Devaluation transfers wealth from…
Q3. A trust mitigates devaluation primarily through…

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