Inflation is high; we discuss the strategy we both use to help clients understand and plan for it.

We haven’t seen inflation figures like this in 30 years. Before trying to beat inflation, the first step is to look at the underlying emotions evoked by talk of inflation. The #1 question to ask yourself is: what is it that I’m ACTUALLY afraid of?
a. …of being dumb with my money?
b. …of not being able to afford things in the future?
c. …of running out of money because prices go up?

The second step it so look at the facts. That sounds silly, but the emotions that fear can stir up often lead us to a downward spiral of thinking, so it can be really helpful to step back from our feelings and look at the facts without judgement.
The third step is to act. The strategy both John and Bridget use to take advantage of inflation is to buy stocks, have a fixed mortgage, and buy I-bonds.

Check the minute marks:
0:40 Step One Understanding the emotions that inflation evokes :40
4:47 Step Two Take a step back and look at facts 4:47
7:34 Step Three Three actions to take to make sure your finances are set up to take advantage of inflation

Here’s Bridget’s firm website: www.sullivanmermel.com
Here’s John’s firm website: www.trinfin.com

For advisors around the US:
www.acplanners.org

Thanks for watching and please subscribe!

View the video transcript with the following link:
…(read more)

LEARN ABOUT: Investing During Inflation

REVEALED: Best Investment During Inflation

HOW TO INVEST IN GOLD: Gold IRA Investing

HOW TO INVEST IN SILVER: Silver IRA Investing

When it comes to financial planning, one should always take inflation into consideration. Inflation, the general increase in prices of goods and services over time, erodes the purchasing power of money. If your savings or investments do not outpace inflation, you may find yourself with a smaller nest egg than expected.

The traditional approach to combatting inflation has been to invest in assets like stocks, real estate, and commodities. These investments tend to appreciate in value over time, hopefully outpacing the rate of inflation. However, there is another strategy known as the “high inflation money strategy” which focuses on investing in currencies of countries experiencing high rates of inflation.

The goal of this strategy is to take advantage of the high inflation rates by investing in a currency that is expected to appreciate rapidly. By doing so, you can potentially earn a higher return on your investment, outpacing the rate of inflation and preserving your purchasing power.

Now, this strategy may sound counterintuitive. Why would anyone want to invest in a currency experiencing high inflation? Well, high inflation often leads to a decline in the value of a currency, but it can also create investment opportunities. Let’s take a closer look at how this strategy works.

Firstly, you need to identify countries that are experiencing high inflation. Typically, these countries have central banks that are aggressively expanding the money supply, leading to higher inflation rates. Examples of countries that have historically experienced high inflation include Zimbabwe, Venezuela, and Argentina.

Once you have identified the country, you need to decide how to invest in its currency. One way is through buying government bonds denominated in that currency. Government bonds are essentially IOUs issued by the government and are considered a relatively safe investment. However, investing in high inflation currencies carries significant risks, so thorough research and understanding of these risks are essential.

Another way to invest is through currency trading or foreign exchange (forex) markets. This method involves buying the currency outright with the hope that its value will appreciate against your home currency. Forex markets are highly volatile, and trading currencies requires a deep understanding of market dynamics and economic factors affecting exchange rates.

It is important to note that the high inflation money strategy is speculative and carries high risks. Investing in currencies experiencing hyperinflation could lead to substantial losses if the economy further deteriorates. Therefore, it is vital to only allocate a small portion of your overall investment portfolio to this strategy, which should be considered as part of a diversified investment approach.

Furthermore, this strategy requires ongoing monitoring and adjustments, as inflation rates and currency values can change rapidly. Just as you would regularly review and rebalance your other investments, the same diligence should apply to your high inflation currency investments.

In conclusion, the high inflation money strategy can be a viable approach to beat inflation, but it comes with inherent risks. It is important to thoroughly research and understand the economic and political situations of the country you are considering investing in. Seek advice from financial professionals and diversify your investment portfolio to mitigate risks. By implementing this strategy cautiously and prudently, you may be able to preserve your purchasing power and potentially earn higher returns in times of high inflation.