Inflation Most of us underestimate the cumulative impact inflation can cause because it’s been so low for the last 40 years. But that has changed. With the onset of higher inflation, there is a new emphasis on countering its effects and maintaining purchasing power. Why? Because retirement savings shortfalls are so serious that nearly 25% of Americans may need to delay their retirement due to inflation. 3
When Inflation affects your purchasing power, it’s not just with groceries and fuel where you feel the pinch. You also have your standard cost of living to consider
3 Source: BMO Harris Bank, BMO Real Financial Progress Index. Data from quarterly survey conducted between March 30 and April 25, 2022.
as well as the need for additional health care.
So how do I counter inflation’s effects? With growth from your investments.
Inflation erodes purchasing power 12-month CPI change – as of October 2022 4
17.6%
20%
15%
10.9%
8.4%
7.7%
10%
6.9%
5.4%
5%
0%
Energy
Housing
All items
Medical Care New Vehicles
4 Source: U.S. Bureau of Labor Statistics, Consumer Price Index (CPI). Data as of October 31, 2022.
5
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