“In 2022, we are experiencing the fastest pace of consumer price and wage inflation in nearly 40 years. How can you navigate this volatile environment and come out with your nest egg intact?” Ken May
By Ken May
*Please note: I wrote this article for entertainment and educational purposes only and not to give investment or other financial advice. Before considering any action, I strongly recommend you consult your accountant, attorney, or another qualified financial professional.
Amber and Johnny’s courtroom antics aside, inflation is likely the most discussed issue of 2022. And why wouldn’t it be? Inflation is typically defined as overall increases in the costs of goods and services in an economy. Economists say that some inflation is normal, even desirable in a large economy. However, when inflation increases rapidly in a shorter period, as it has post-pandemic, there are massive repercussions for nearly everyone. In times of high inflation, paper currency experiences a loss of value, and you can’t buy as much with your dollar this year as you did last year. Life has become more expensive in 2022, and retirees and those still working feel the pinch in everything from their food bills to gasoline.
With asset bubbles all around you and turmoil in our economy, can you stop (or at least slow down) the impact of inflation on your money? While there are no quick fixes or magic potions that will cure our economic ills, long-term thinkers may want to do some things that successful business owners and wealthy individuals tend to do in inflationary times.
- Consider multifamily real estate. Multifamily real estate gurus Jake and Gino of Wheelbarrow Profits say that what they call “longtermism” is essential if you want to benefit from real estate as an inflation hedge. Chronic construction and supply chain woes after the pandemic contributed to a housing shortage that won’t go away soon. And, chances are, as real estate bubbles burst and release inventory into the markets, prepared individuals may be able to pick up some exceptional real estate bargains. Owning where people live may be one of the last avenues left to Americans who want to create and grow wealth. Investing in real estate isn’t for everyone, and a degree of risk is involved. Be sure to do your due diligence, keep your debt as low as possible, and partner with experienced investors to increase your chances of positive outcomes.
- Look into precious metals. For thousands of years, precious metals have been a desirable store of wealth, especially during political and social instability. Most wealthy people, including the Rothschild family and billionaire investor Ray Dalio, hold at least some gold, silver, platinum, or palladium in their portfolios. Because you can’t produce precious metals on demand out of thin air like paper money, precious metals are seen by many as a haven for wealth that is tangible and finite.
- Spend time with your financial advisor. How long has it been since you sat with your financial advisor and took a deep dive into your retirement accounts? If you are like most people, it’s probably been a while. Does your asset allocation reflect your current risk tolerance? Will your current mix get you to your overall goals? If you are in or near retirement, consider re-balancing your portfolio to include more safe money products. Do you have at least one source of guaranteed income to supplement Social Security?
Summing it up: Although things may look bleak for 2022-23, remember that economics and history are cyclical. Every market downturn represents opportunities for those creating and executing a comprehensive prosperity plan. Partner with a trusted advisor to ensure your nest egg stays in tack, even if the rest of the economy cracks up.
File under #inflation, #multifamily #wheelbarrowprofits, #goldandsilver