5. Equities Help Protect Purchasing Power
Stocks, Bonds, Cash Equivalents and Gold vs. U.S. DollarInflation-Adjusted Returns for the Period from December 31, 1977 to June 30, 2014
Investing to Combat Inflation
Inflation, by definition, drives prices up and pushes the purchasing power of your saved money down. While not much attention has been paid to inflation since the early '80s, recent fiscal concerns have many wondering how much inflation will impact our economy in the years ahead. Stocks, despite their recent travails, have done the best job of providing returns after inflation is taken into consideration.
The Bottom Line
- Over time, inflation shrinks buying power.
- Speak to a financial advisor for help creating an investment plan with the goal of protecting purchasing power.
Another reason to be an equity investor: History Favors a Return to the Mean
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