Inflation can quietly erode your purchasing power—especially dangerous during retirement when you’re living off fixed or semi-fixed income sources. While inflation may seem like just a number in the news, its long-term effect on your retirement savings can be significant.
As a fiduciary financial advisor, I am committed to helping clients like you make informed decisions that protect your wealth. In this guide, we’ll explore how inflation affects retirement planning and when (and how) you should adjust your strategy.
Why Inflation Matters in Retirement Planning
Inflation is the general rise in prices over time. Even modest inflation rates can cause major financial shortfalls if not factored into a retirement plan.
Consider this example:
If you need $80,000 per year to live comfortably today, with just 3% annual inflation, you’d need approximately $107,000 in 10 years to maintain the same lifestyle.
Key Risks of Not Adjusting for Inflation
- Reduced Purchasing Power: Your dollars simply won’t go as far.
- Rising Healthcare Costs: Medical expenses often outpace general inflation.
- Longevity Risk: Living longer means your money needs to last longer, and inflation compounds the challenge.
When Should You Adjust Your Retirement Plan?
If you haven’t revisited your plan in the past 12 months—or if inflation has significantly increased—now is the time.
You should consider adjusting if:
- You’re within 5–10 years of retirement
- Your investments are overly conservative
- You rely heavily on fixed-income sources like pensions or Social Security
- You haven’t accounted for healthcare inflation
- You’ve recently retired and are unsure if your plan is keeping pace
How to Adjust Your Retirement Plan for Inflation
Here are five fiduciary-approved strategies to consider:
- Review and Rebalance Your Portfolio
Work with a fiduciary advisor to ensure your investments are diversified and include inflation-resistant assets like:
- Treasury Inflation-Protected Securities (TIPS)
- Real estate or REITs
- Commodities or natural resources
- Dividend-growth stocks
- Delay Social Security
If possible, delaying Social Security benefits can increase your monthly payments—helping hedge against inflation in later years.
- Include Guaranteed Income with Inflation Riders
Some annuities and pensions offer cost-of-living adjustments (COLAs). Ask your advisor about options with inflation protection.
- Plan for Rising Healthcare Costs
Consider adding a Health Savings Account (HSA) or long-term care insurance to your plan to cover future medical expenses.
- Recalculate Your Withdrawal Strategy
Instead of a fixed percentage, work with your advisor to create a dynamic withdrawal strategy that adjusts to inflation and market performance.
Why Work with a Fiduciary Financial Advisor?
A fiduciary financial advisor is legally and ethically obligated to act in your best interest—not to sell products or push commission-driven solutions.
We focus on:
- Long-term financial wellness
- Transparent, personalized planning
- Evidence-based investment strategies
- Education and empowerment
Final Thoughts
Inflation isn’t going away—but with proper planning, you can protect your retirement income and lifestyle. Adjusting your retirement strategy isn’t about reacting with fear—it’s about proactively managing risk.
Call-to-Action:
If you’re unsure whether your retirement plan is inflation-ready, let’s talk. As a fiduciary financial advisor, I offer personalized, transparent guidance tailored to your goals.
Schedule your complimentary consultation today.
Global View Capital Management (GVCM) is an affiliate of Global View Capital Advisors (GVCA). GVCM is a SEC Registered Investment Advisory firm headquartered at N14W23833 Stone Ridge Drive, Suite 350, Waukesha, WI 53188-1126. 262.650.1030. Ryan Peca is an Investment Adviser Representative (“Adviser”) with GVCM. Additional information can be found at www.adviserinfo.sec.gov Global View Capital Insurance Services (GVCI) is an affiliate of Global View Capital Advisors (GVCA). GVCI services offered through Experior Financial Group, ASH Brokerage, and/or PKS Financial. GVCI is headquartered at N14W23833 Stone Ridge Drive, Suite 350, Waukesha, WI 53188-1126. 262-650-1030. Ryan Peca is an Insurance Agent of GVCI.
These views do not necessarily represent the views of GVCM or any of its affiliates. Investment involves risk.