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Inflation fear is still surging across national media, and for retirees in particular, it’s easy to see why. In some instances, inflation can pose one of the biggest pitfalls to your lifelong savings, so if you’re feeling the panic, this is your signal to pause. Take a moment to gather the facts, because you might find that in reality, things aren’t as bad as they seem.READ THE ARTICLE
Show me the numbers: While yes, we are seeing a longer period of inflation than anticipated, the author of this article states that according to data, this hike isn’t here to stay. Based on inflation predictions from the Cleveland Federal Reserve (a model shown to have one of the best track records over the past two decades), current projections versus those of four months ago have barely budged (from 1.58 percent, to 1.63 percent).
In comparison to projections from the University of Michigan, as well as the predicted breakeven inflation rate, the Cleveland Fed is still holding to belief that we are in fact going through a transitory inflation period. Its model findings appear more consistent and less volatile than that of the other compared models, and it’s important to note that these models, while more sporadic, almost always quickly revert back.
Focus on the long game: When it comes to your financial plan, often the best thing to do is simply turn off the news, or at the very least, seek information from a wide variety of academic resources. You should always have a long-term plan for inflation, not just a short-term plan.