How does inflation affect the value of savings?
It's not so grim: interest rates on savings tend to be higher than inflation, because lenders factor in expected inflation and won't lend unless they're compensated for the risks they face and the fact that they can't use the money in the meantime. So while Joe isn't likely to be lending directly, by saving money in a bank, he's lending money to the bank that the bank will then lend to others, and all Joe needs to do is make sure that his money is in an account that will pay him a decent rate of return (i.e., one that is higher than inflation).

If Joe put \$100,000 in a mattress or in a bank account that pays a 0% rate, then yes, in 20 years if inflation has risen by 1.5% annually, then the money will only be worth about \$74,000 in today's dollars. But if he saves the money in an account that pays a higher interest rate than inflation (or buys a financial instrument like TIPS, a type of government bond that pays an inflation-adjusted return), his kids will have an amount of money equal to more than \$100,000 in today's dollars.

The yield to maturity on a TIPS bond maturing in 2040 is currently about 0.9%, which isn't very high, but that's a nearly risk-free investment that is protected against inflation. If Joe bought one of these, his kids would have about \$100,900 in today's dollars. If he instead took on a certain amount of risk, his kids could have potentially much more.