Investing / Protecting investments from inflation
May 12, 2021
Protecting investments from inflation
I'm quite hands on with my own money and investing. I recently went to see a financial planner among other advisors as I think about transferring my assets to my kids over the next twenty years. It has been good learning. But the market turning downwards so quickly got me worried about how I am invested today. I have stock and bond mutual funds, ETFs, and some single stocks too. How are you thinking of protecting your investments from inflation if at all? Thank you for your replies!
Replies (17)
May 13, 2021
Right about stocks historically being a good hedge against inflation. Stay invested. Rising prices goes well with rising profits when all said and done.
May 16, 2021
@Sebi675 Thanks.
Sep 07, 2021
TIPS or treasury inflation-protected securities is another choice
Sep 25, 2021
@Andy497 I use a 15+ yr TIPS ETF, but have also been eying Series I Savings Bonds.
Sep 25, 2021
@Har'el645 Interesting, thanks for sharing that. Will be doing some research here!
J
2,861
Sep 07, 2021
@Andy497 Right, and there was this discussion post here about it, if it helps.
Sep 24, 2021
@Jess225 Interesting thanks a lot!
May 13, 2021
For me its about not paying down my mortgage more than I have to at a 2.675% mortgage rate! I'm quite happy investing my money instead. I understand people will have different opinions about this, but this is what gives me peace of mind!
May 13, 2021
@copperpenny Smart idea here. Inflation allows borrowers to pay lenders back with money that is worth less than it was when it was originally borrowed, which benefits borrowers
Jul 14, 2021
Stick with S&P 500 or if you want to get a little more hands-on, muni bonds.
Jul 31, 2021
@Ben351 Right! Hadn't thought of muni bonds.
You may find this lesson relevant and helpful.
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Investing in Bonds
Investing Basics
5 min
May 12, 2021
For me it's been bitcoin and ethereum!
J
May 12, 2021
If it were me I wouldn't touch ur investments. Let it grow as is. The stock market has been shown to be a better inflation hedge than some commodities like gold if you can believe it (Blackrock did a study on this, will try to find it and share it).
J
May 13, 2021
@Jan274 Here's the article I was referring to.
May 22, 2021
I read research recently that when you look at the S&P 500 sectors and their correlations to the inflation metrics like PPI and CPI, energy and industrial sectors were most positively correlated. That makes sense though because they are segments most closely tied to economic cycles vs. segments that are really sensitive to interest rates and changes there, like communication services/healthcare/consumer discretionary (that are most negatively correlated industries). So it may not be a bad idea to layer in 1-2 sector ETFs if you're worried.
Sep 09, 2022
@RinaPLD, if you're fully invested already (sounds like you are) just set and forget it, do nothing.