Yes, You Can Profit from Inflation. Here’s How

Yes, You Can Profit from Inflation. Here’s How

From buying groceries to gasoline to automobiles, inflation has hammered Americans’ purchasing power. In fact, the most well-known metric of inflation has soared to a four-decade high. A myriad of factors has come together to increase inflation in 2021 and 2022. To remain financially healthy, we have to aim not only to invest so our money keeps pace with inflation, but also so we profit during it. We discuss several investments you can make to build your wealth during high inflation. Consider working with a financial advisor as you seek to adjust your investments to inflation.

Understanding Inflation

Inflation usually refers to price increases in the broad economy, although it can refer to increasing prices in just one or two economic sectors. Inflation can be caused by many factors such as spikes in demand for goods and services or rising production costs. It is often measured by the trailing 12-month Consumer Price Index (CPI), which is based on a set basket of goods and services. In February 2022 the CPI climbed to 7.9%, a four-decade high.