Inflation in the Nation: Talking Financial Fitness with Roger S Green.
In this episode of “Your Green” with Roger S Green, we talk about inflation and what everyone needs to know when it comes to preserving your financial fitness in today’s economy. Inflation is in the headlines and folks want to know what that means for their retirement and savings.
Everyone is feeling the impact of inflation in the nation today. We notice it at checkout counter in the grocery store or when the price of other goods and services we regularly budget for each week cost more. As inflation goes up, the buying power of our income goes down. That doesn’t feel great for anyone, especially when you seem to be working harder for less. If inflation is effecting your day to day, then it will also impact your future.
Inflation is something frequently overlooked in retirement planning. Inflation can be defined as an overall upward price movement of goods and services in our economy as measured by the Consumer Price Index (CPI), and it is what makes most things cost more today than they did in prior years. Because ongoing inflation increases the cost of goods and services, it takes away the buying power of your money. You will need more money to live on in the future than you need currently to maintain your standard of living, and this is very important to keep in mind when setting goals for retirement.
Why is this important to your retirement planning?
Inflation turns your retirement goals into moving targets. You want to be able to afford the things you need and want in retirement, often years in the future; so inflation must be accounted for in your planning.
Inflation doesn’t stop at retirement, so if you retire at age 65, the income you will need will effectively double every 24 years (by age 89) if a 3% average annual inflation rate continued during that time frame.
With today’s earlier retirements and long life spans, many people may see two or more doubling in cost during their retirement period, depending on the inflation rate.
Your retirement planning must include planning for the impact of inflation. For most people, simply saving is not sufficient and they need growth, earnings, and the power of compounding on their money – even throughout retirement – to help their assets grow enough to keep pace with inflation.
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Roger Green is an Investment Advisor Representative offering Securities and advisory services through Cetera Advisors LLC, member FINRA/SIPC, a broker/dealer and Registered Investment Adviser. Cetera is under separate ownership from any other named entity. Roger Green is located at 3700 CRESTWOOD PKWY STE 140, DULUTH, GA 30096. For a comprehensive review of your personal situation, always consult with a tax or legal advisor. Neither Cetera Advisors LLC nor any of its representatives may give legal or tax advice. All investing involves risk, including the possible loss of principal. There is no assurance that any investment strategy will be successful. A diversified portfolio does not assure a profit or protect against loss in a declining market. These examples mentioned are hypothetical only, and do not represent the actual performance of any particular investments. Investments in securities do not offer a fixed rate of return. Principal, yield and/or share price will fluctuate with changes in market conditions and when sold or redeemed, you may receive more or less than originally invested. Dollar-cost averaging will not guarantee a profit or protect you from loss but may reduce your average cost per share in a fluctuating market. To qualify for the tax-free and penalty-free withdrawal or earnings, a Roth IRA must be in place for at least five tax years, and the distribution must take place after age 59½ or due to death, disability, or a first time home purchase (up to a $10,000 lifetime maximum). Depending on state law, Roth IRA distributions may be subject to state taxes. Investors should consider the investment objectives, risks, charges, and expenses of the funds carefully before investing in mutual funds. The prospectus contains this and other information about the funds. Contact our office to obtain a prospectus, which should be read carefully before investing or sending money. Best of Gwinnett winners are chosen via voting and editors’ input, & opinions are vetted with the use of other available information. Awards and inclusion in lists cannot be considered a guarantee of future performance or success.