Although inflation may slow in the months ahead, it’s likely to stay above pre-pandemic levels for some time due to supply chain disruptions and high energy prices. The key question now: Can the Fed slow inflation without tipping the US economy into recession?
Inflation-proof your future
Rising prices erode your purchasing power. Here are some savvy budgeting, saving, and investing strategies to help protect your money and your lifestyle, whether you're retired, nearing retirement, or still working.
Investing for growth
One way to inflation-proof your portfolio is to invest in companies that have the potential to grow their earnings faster than inflation. Opportunities to consider include producers of energy, precious metals, and other commodities, plus real estate and more.
Investing for income
A silver lining to rising interest rates is rising yields on bonds. You can also build inflation protection into your portfolio with Treasury Inflation-Protected Securities (TIPS), leveraged loans, and dividend-paying stocks.
Past performance is no guarantee of future results.
This information is intended to be educational and is not tailored to the investment needs of any specific investor.
Views expressed are as of the date indicated, based on the information available at that time, and may change based on market or other conditions. Unless otherwise noted, the opinions provided are those of the speaker or author and not necessarily those of Fidelity Investments or its affiliates. Fidelity does not assume any duty to update any of the information.
Investment decisions should be based on an individual’s own goals, time horizon, and tolerance for risk.
Investing involves risk, including risk of loss.
Stock markets are volatile and can fluctuate significantly in response to company, industry, political, regulatory, market, or economic developments. Investing in stock involves risks, including the loss of principal.
Foreign markets can be more volatile than U.S. markets due to increased risks of adverse issuer, political, market, or economic developments, all of which are magnified in emerging markets. These risks are particularly significant for investments that focus on a single country or region.
Because of their narrow focus, sector investments tend to be more volatile than investments that diversify across many sectors and companies.
In general, the bond market is volatile, and fixed income securities carry interest rate risk. (As interest rates rise, bond prices usually fall, and vice versa. This effect is usually more pronounced for longer-term securities.) Fixed income securities also carry inflation risk, liquidity risk, call risk, and credit and default risks for both issuers and counterparties. Any fixed income security sold or redeemed prior to maturity may be subject to loss.
Increases in real interest rates can cause the price of inflation-protected debt securities to decrease.
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