One theme I keep coming back to on this site is that people are living longer. Therefore, they must be prepared for what inflation in retirement can do to their income and savings.
The temptation for many retirees is to play it too safe by putting all their money into guaranteed products that typically won’t keep up with inflation (like CD’s or fixed annuities). Sure, you may never see the value of your CD at the bank decline, but at the same time it probably won’t give you an interest rate that will keep up with inflation.
What happens is your purchasing power declines over the years as inflation causes prices to go up. If all of your nest egg is in conservative investments (like CD’s and fixed annuities), there’s a good chance that your portfolio won’t earn enough to offset what inflation is doing to it.
One strategy to offset inflation in retirement is to have a portfolio that will give you the potential for growth. Here is a very insightful article that shows you 3 investing strategies for long term growth for your portfolio. It also shows you how to have some protection against stock market volatility. Click here to read the full article.
If you find this article helpful, be sure to click on the social media icons on the left of the page.