Inflation: A Reason to Worry….Or A Call to Action?

Even the wealthiest worry about money. Their biggest fear: Inflation.

Inflation is, indeed, a ravenous creature that devours our cash like a caterpillar on a leafslowly, methodically, little bits at a time.

For years, however, inflation has stayed quite low. But that’s rapidly changing. Inflation has hit its highest rate in more than 40 years. And it’s expected to keep escalating.

Is it time to start worrying? Heavens NO! The worst response to climbing costs (or most anything else for that matter) is to go into fear, which tends to have a paralyzing effect.

Instead, look at rising inflation as a resounding call to action…no matter how much or how little money you have.

The only way to counter the ravages of rising prices is to make sure at least some of your savings is working harder than it would in a bank. How? By investing in assets that grow faster than what inflation takes away.

Start by making sure your money is well diversified. Here’s the standard rule of thumb for investing wisely:

  • Money you need in the next 3 to 5 years--for emergencies, unexpected expenses, or short-term goals–should be in cash or cash equivalents like money market funds, CD’s, or short-term treasuries.
  • Money you’ll need in the next 5 to 10 years should be in a mix of conservative, steadily growing stocks and bonds.
  • Money you won’t need for 10 or more years should be mostly in stocks and perhaps commodities and real estate.

You can’t eliminate inflation. But you can do a lot to protect yourself from it.

What immediate impact is inflation having on your financial situation and what steps are you taking to fight it? Share in the comments below.

Comments & Feedback

  • Lisa

    Barbara ,

    Thanks for posting this!

    I wrote a bunch of realistic, New Years resolutions at the beginning of the year to contribute to my retirement fund, savings and to add some stock to my portfolio. I can fight inflation by prioritizing this goal and by slowly increasing and diversifying my funds every year.

    Even though I earn good money and my husband is not too financially dependent on me, I find it challenging sometimes. No matter how wealthy you are, life is expensive and there are so many tempting things to purchase that make life wonderful!

    I took action straight after reading this by cutting my own finger nails 💅 this month instead of going to a manicurist and by postponing to get my air conditioning systems cleaned next month instead of this month! I’m halfway towards my financial goal. I don’t want to sabotage it! I really need to hang in there! I’m not depriving myself though, I’m jetting off to a tropical island in August 🏝 ✈️

    Although I’m not a traditional, religious person. I want to pray for people who are actually taking the action to dig themselves out of debt 💸 every month without fail; not just talking, moaning and complaining about it! Bless you! This is so hard to do! Good things will come your way 🌈 !

    Some people only want to pray for the victims who are just like them, but I want to pray for the people who are digging themselves out of a hole, working extra hours or an extra job, staying off welfare and pray for charities who are generously helping others by spotting them cash, so that others can keep up with repayments or stay out of debt 💸 I want to pray for people who are not waiting to scratch a winning lottery ticket, or a get rich quick scam that’s immediately going to solve all there money issues.

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Meet Barbara Huson

When a devastating financial crisis rocked her world, Barbara Huson knew she had to get smart about money… and she did. Now, she wants to empower every women to take charge of their money and take charge of their lives! She’s doing just that with her best-selling books, life changing retreats and private financial coaching.

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