Special Topic – Inflation & Cost of Living

Page 4: Impact of Inflation on the Common Man

Date: 07 February 2026

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1. Rising Cost of Daily Essentials

Inflation directly increases the prices of essential goods such as food, milk, vegetables, cooking oil, and medicines.

• Monthly household expenses increase
• Savings reduce for low-income families
• Middle-class budget becomes strained

2. Impact on Salaried Employees

Salary growth often does not match inflation. This reduces real income and purchasing power.

• Same salary buys fewer goods
• Increased pressure on household planning
• Higher dependence on loans

3. Effect on Poor and Vulnerable Sections

Poor households are the worst affected by inflation as they spend most of their income on basic needs.

• Food insecurity increases
• Health and education spending reduces
• Dependence on government welfare schemes

4. Education and Healthcare Costs

Inflation increases school fees, medical expenses, and cost of medicines.

• Higher education becomes less affordable
• Delay in medical treatment
• Long-term impact on human development

5. Loan Burden and EMI Pressure

When interest rates rise to control inflation, loan EMIs also increase.

• Higher home loan EMIs
• Personal loans become costly
• Reduced disposable income

6. Psychological and Social Impact

Inflation creates stress and insecurity among families.

• Financial anxiety increases
• Social inequality widens
• Lower quality of life

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This page highlights how inflation affects the daily life, income, and well-being of the common man.