In the face of lingering inflation, consumers are grappling with the pinch on their wallets. Edelman Financial Engines Director of Financial Planning Kelli Smith joins Wealth! to discuss strategies for combating inflation.
Smith emphasizes the importance of being proactive, stating that individuals need “to get out in front of it.” She advises those preparing for “an inflationary environment” to prioritize saving and building an emergency fund, while focusing on minimizing debt as much as possible.
Smith encourages individuals to ensure that their “expectations are flexible,” acknowledging that they cannot control external factors. She advises identifying areas where downsizing and cost control are possible, saying it’s important to “change behaviors where needed but really to have a flexible mindset.”
“The first thing is to have a plan. Having a plan means that you’re gonna be able to calculate how much you need to save for the long term, how much emergency savings you have, and in other ways, it’s gonna help you combat inflation over time.” Smith told Yahoo Finance.
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Inflation environment means that money loses value, so just saving is working hard accoumulating something that actively decays… So make sure those savings get into some non-cash correlated asset if you want to keep it. Arguably, young people can go into debt to invest in themselves and inflation might erode that debt down if in the future their pay increases with inflation, though with interest rates being high, maybe not true anymore.
How to? Don’t vote for Biden. He’ll make inflation even worse.
And drumpf will abolish the Feds altogether and control interest rates directly himself. What do you think he’s gonna do, raise ’em?
Having low interest rate fixed rate debt is awesome when inflation booms.
I’m sure the Federal Reserve would have raised rates by now by at least .25% if it weren’t an election year. Politics happen.
The only way, well, there’s two ways to defeat inflation. First, put more oil in the market to reduce pricing right up, and second stop printing money the FED doesn’t have. 😂