Inflation Protection

If you can fog a mirror, you’ve probably heard. Inflation is the highest it’s been in decades.

Inflation is a ravenous creature that devours our dollars like a caterpillar on a leaf–slowly, methodically, little bits at a time. But this recent bout seems more like a famished elephant.

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, where it earns next to nothing.

In normal times that means the stock market. But with markets in turmoil, many of us are looking for safer alternatives. That’s why I got so excited when I read Jason Zweig’s column in this week’s Wall Street Journal.

“Fortunately, raising the return on your cash is easier than ever,” he declared. “The two best choices are money market funds and U.S. Treasury securities.”

Really? Last I checked, money market funds were paying about .02%. Not anymore. This week, the article points out, more than 380 money market funds were yielding 2.5% or more.

Granted not all funds are paying high amounts. Google will tell you the ones that are.

The other alternative are U.S. Treasury bills, considered the safest and most conservative investments. Treasury Bill yields are usually ultra-low. Not today. According to Zweig, a one-month T-bill pays 2.6%.

That number looks even more attractive when you consider that Treasuries are free from state and local taxes.

Plus they are backed by “the full faith and credit” of the U.S. government, so they are considered risk free.

And there’s no fee when you buy them through Treasury or a brokerage firm.

As Zweig boldly proclaimed, “Cash isn’t trash anymore.”

How are you protecting your money from inflation? Let me know in the comments below.

Comments & Feedback

  • Lisa

    Helpful post, Barbara!

    I noticed something similar is happening in Australia.

    Money market flexi rates have been fluctuating between 0.40% to 0.50% and haven’t been this high since Feb, 2019 before Covid. (I keep a record of my investments in my spiritual journal)

    You inspired me to break my Septemeber investment at 1.30% for 3 months and reinvestment it for 2.30% at 6 months. It took less than 2 minutes to do online! I have a feeling it will go up again around December when it’s time to add more money to my emergency savings. I am prepared to break it again, add more savings and lock it in at an even higher rate for a longer time.

    This is really good news for people and families who are working at rebuilding their emergency savings after Covid. It’s very motivating!

    • barbara huson

      Great job, Lisa. I’m thrilled that my newsletter inspired you to take action. You’re right, this is really good news for all savers!! Thanks for letting me know and sharing how simple it was!!! !

  • Lisa

    Thanks Barbara,

    It’s been less than a week since I posted this and interest rates have increased even more!!!! Cancelling and reinvesting at a higher rate again!

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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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