Inflation Summit
Learn about a crazy little thing called inflation.

Besides cars and college tuition, there’s another reason to save your money: Like this hot air balloon, prices tend to go up! Another way of looking at it is that over time, the value of your money shrinks. When Ashley was just a kid, it only cost 50 cents for a ride in this hot air balloon to Inflation Summit. As Ashley grew little by little over the years, so did the price. Now that Ashley’s all grown up, it costs $5 for the same ride!

When prices go up over time, it’s called inflation. And inflation tends to go up faster when most people are working and earning money. That’s because when people have jobs and money, they’re usually willing to pay more for the items that they want to buy. And the more people earn, the higher prices tend to rise.

Think about it this way: The more money you have, the less you’ll worry about spending some of it. If you have only $10, a ride in a hot air balloon might not be worth $5, or half your life’s savings. But if you have $100, you might be willing to pay $5 for a ride. And when prices rise, businesses have to charge more for their goods and services to maintain a profit.