Inflation forces people into debt cycle, asset sale

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• From Karachi to small towns in Punjab, households struggle to make ends meet
• Families skimp on food or enrol kids in seminaries instead of schools

KARACHI / TAXILA: Growing up in a Pakistani household, lessons in “saving something for a rainy day” are inculcated into children from a young age. These savings could be in the form of cash or assets, like gold. For every family, the definition of a “rainy day” varies, but in our parlance, they broadly refer to any event that throws the family’s finances off the rails — a wedding, sudden illness and business losses, etc.

Such savings were allocated for major expenses, not meeting day-to-day needs. However, in recent times, amidst a spiralling economic crisis and ballooning inflation, this distinction is fast eroding. More families are now compelled to cut into their financial safety nets to meet daily needs, like power bills, sch­ool fees for children, house rent and other expenses.

Zubaida Bibi is a widow who lives in a rented house in Taxila’s Bilal Colony.

When her electricity bill for August upended the household budget, she was left with no other option but to pawn her three-decade-old engagement ring with a neighbour and borrow money to pay the bill.

She hoped to get the ring back after receiving her pension funds, which were yet to be released.

Karachi resident Ahmed Zaman, 40, is the sole breadwinner for his family of six. His monthly salary of Rs150,000 was enough to manage household expenses up until last year, but not anymore.

“This month, I asked my wife for some help and she sold her gold earrings which she got at our marriage,” he told Dawn while giving a breakdown of his daily cost of living which has “gotten out of hand”.

“The house I live in has Rs35,000 rent, and my last electricity bill was over Rs40,000,” he said, explaining how half of his salary is consumed in only two expenses.