All around the world inflation is climbing higher. In the UK, the cost of living rose by 5.1% in 2021, its highest rate in 10 years. In the US, it rose by 7%, the highest in 40 years. Across the EURO area, the annual inflation is up to 4.9%.
The value of cash is being eroded by inflation, this can only be protected by investments which match the same inflation rate. Your portfolio or pension scheme must have generated 5.1% if you are living in the UK, 7% in US, and 4.9% on average if you are in Europe.
What sparked the inflation rate?
The jump is largely driven by rising fuel and energy costs. Other factors such as supply chain breakdowns, labour shortages and sudden burst of spending due to COVID-19 lockdowns.
This will in turn increase prices across a broad range of products such as fuel and energy.
How does inflation impact you?
This impacts you mainly in 2 ways.
Firstly, the value of your savings has dropped in value by 4.9%. They will never regain their value unless you reinvest the cash into a product that will earn more.
For people in workforce – your purchasing power of 1 dollar/euro is now $0.93 and €0.96.
For retirees – your fixed income has dropped by 7% in the US and 4,9% on average in Europe.
Secondly, if you have loans, this will increase your loan interest repayment and add to the loss of your dollar/euro value.
What can you do?
Place your funds into investments such as S&P 500 Index, gold or fixed income products to earn a return above 7% and secure the value and growth of your savings.
Click here to get information about the 12-month fixed income plan paying 12% per year. Interest is paid out on a quarterly basis directly to your bank account or you can have it reinvested into the plan and allow it to compound over the years.
To receive the 12-month Fixed Income Plan or S&P 500 Index Plan information click here or send us an email at info@crewinvest.net
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