US Money Reserve: The damages of Inflation

U.S. Money reserve is one of the largest distributors for United States government issued coins. Specializing in the handling of precious metals U.S. Money Reserve has helped thousands of clients with meet their needs in the precious metals market.

Currently, inflation rates are topping out of 2 percent which is causing many people who watch the markets to raise their eyebrows. Let’s be clear inflation is the rate of change in the price of consumer goods over time. This is typically measured using something called the consumer price index or CPI. This tracks the prices of hundreds of common items from bread to milk and the way their prices fluctuate over time. A common question is what does this mean for you, the average consumer? High inflation sustained over long periods of time means a decrease in the purchasing power of your dollar. Meaning that the money you have in the bank is actually lowering in value over time. Its simple your money will not go as far as it used to.

This has far-reaching implications for anyone. You could end up with less money left over after every paycheck. Unless you receive raises that are in line with or higher than the rate of inflation over time you will be able to purchase less and less with your pay. Retirement can become complicated as the money you saved from decades ago simply is not worth what it used to be worth.

There are a few ways that you can protect against the damaging effects of inflation. One of the most prudent examples is diversification away from the dollar. Do not keep all your eggs in one basket, have your money work for you. Keeping a portion of your savings in commodities such as oil or gold have been shown to be a good hedge against inflation in the past. In times of hardship physical gold itself almost always outperforms all other asset classes in terms of retaining its value. According to the CPI not only has gold maintained its value but it has increased in comparison to inflation over the last several years.

Another great way to protect against the effects of inflation is to invest in yourself. By investing in education and training opportunities you can increase your ability to earn or your salary. No matter which way you go there are options for you to safeguard your self from the ravages of rampant inflation, whether you put money in commodities in gold or you invest in yourself.


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