Do you worry about the rising tide of inflation? As everything gets more expensive, protecting your nest egg is even more important. But you also have opportunities to take advantage of this volatile time. A professional wealth manager can help. Here are five reasons to work with one today.
1. Adjusting Your Investments
Inflation has many effects on the stock and bond markets. You may need to rebalance both to reduce risk and to seek rewards in different niches. Investments that change quickly based on world conditions, such as commodities, can rise fast, but they can also fall unexpectedly. On the other hand, inflation-protected securities offer a hedge against rising prices.
2. Considering Alternatives
Might this be a good time to dive into some form of alternative to the traditional stock and bond market? One good way to combat the cycles of one investment market is to look to those with different timing. Real estate, for instance, tends to do well during higher inflation. Investors can count not only on appreciation but also on rising rent prices. But not every alternative investment is a good choice.
3. Budgeting at Home
As things cost more, home finances can suffer. You may find that you need to get better control of spending or find ways to spend less on things the family needs. Most people dislike budgeting and may even resist it. But inflation reduces the buffer your family has to keep up their lifestyle, so a good spending plan is a smart hedge against financial crisis.
4. Preparing for Emergencies
How strong is your safety net against emergencies? What about emergencies during a time when everything costs more? Could you pay for the higher costs of putting on a new roof, fixing a blown car engine, or paying rent for your college kids? Should you raise your insurance coverage? Assess your preparedness to handle the unexpected.
5. Calming Your Worries
Inflation, talk of recession, and supply chain disruptions can make even the most experienced amateur investor feel stress. Unfortunately, stress and anxiety also tend to cause questionable choices, like selling stocks during a bear market. Work with a finance professional who will help you keep your eye on the long-term target and avoid acting overly emotionally, but will also respect your risk tolerance.
Where to Start
When inflation worries make you nervous, it's time to change that anxiety into positive actions. In these and many other ways, a wealth management service can help. Call today to make a wealth management appointment and learn what they can do to make this time easier for you.