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Rising Inflation - 4 Things You Should Know



During times of inflation, how should we respond to keep our wealth-building on track? Inflation is ever present in our lives, and it negatively affects us in many ways. Our hard-earned money doesn’t go as far or buy as much as it used to. We see it every day through the high price of gas, our higher grocery bills, or even the higher cost of childcare. Higher prices are everywhere.


When prices are rising especially as much as it has been over this past year, we often look for places to cut back so that we can stretch the money we have. Unfortunately, one of the first things on the chopping block that we cut from our budget is our saving and investing. We usually view saving and investing as optional. We need to change that thinking and take a different point of view.

Instead of missing out on our future wealth potential and slowing down our wealth growth by cutting back on saving and investing, we should think about these four things instead.


First and foremost, you should keep paying yourself first. This should remain as a priority. You should keep your investments automated and untouched. This will ensure that you continue growing your wealth.


Second, look toward high yield savings accounts to help you grow your wealth. During periods of inflation, it usually leads to rising short-term interest rates. When interest rates are rising, we should look for investments that benefit from the higher interest rates. High yield savings accounts are one option to consider. High yield savings accounts usually move quickly to pass along the higher interest rates to account holders resulting in more money for your wealth-building.


Third, instead of cutting off your saving and investing due to rising expenses, look for other ways to save on your budget. This will help you keep your saving and investing on track. Look for discounts or off season purchases to stretch your budget. You may have to delay some purchases, but it will be well worth it when you consider the steady improvement of your overall financial picture.


Finally, you might want to consider purchasing an I-Bond online from the U.S. Treasury Direct. I-Bonds are another investment that benefits from rising inflation. I-Bond stands for Inflation-Bond that adjust the bond interest rate every six months based on the prevailing inflation rate. The current yield or interest rate on an I-Bond is 9.62% as of June 2022. You can purchase I-Bonds at this rate through October 2022, however due to some restrictions with I-Bonds please consult a financial professional before investing.


By knowing these four things, now you can see that inflation doesn’t have to stop your wealth-building journey. You can proactively take action to keep things growing in the right direction. Paycheck to Wealth is your trusted investment advisor that is here to help. Please contact us today to learn more about these four inflation managing ideas and other ideas to help you achieve your investment goals.

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