With inflation at a 40-year high, 5 financial pros share how to invest and save during times of high inflation
On Wednesday, The Federal Reserve approved its largest interest rate hike since 1991 decades, signaling that it wants to get inflation under control. And indeed, the latest consumer price index data revealed that the rate of U.S. inflation rose again in May to 8.6%, which is a 40-year high. No doubt, high inflation has investors and savers nervous about what to do with their money. So we asked experts how consumers should think about investing and saving in this high-inflation period.
1. Invest smartly in your employer-sponsored retirement plan — and a brokerage account
Investing is a key to beating inflation: For example, the average annualized return of the S&P 500 is roughly 10%, data shows. That’s why Stephen Carrigg, certified financial planner and private wealth adviser at Integrated Partners, advises investing in your company’s workplace retirement account, and “open a brokerage account for additional savings that you can view as your mid-to long-term savings and take advantage of compounding,” says Carrigg.