FIDELITY: A post-pandemic boom could cause prices to rise — here's how to prepare

Maura Schauss |

April 20, 2021 from Fidelity.com

Sharing some perspective from our Fidelity resources.  Knowledge is empowering and can support you in remaining focused on your goals.

A post-pandemic boom could cause prices to rise — here's how to prepare1

"Americans are starting to look over their shoulders for an economic boogeyman — and that apprehension could get even worse if the economy comes roaring back to life after the coronavirus pandemic.

The fear is that massive government spending to blunt the blow of the crisis, coupled with easy monetary conditions for years to come from the Federal Reserve and a post-vaccine boom that gets consumers out traveling, dining and shopping again, could create the perfect storm that leads to a spike in inflation ...

So while bracing for the wallet-harming kind of inflation that eats away at your purchasing power and diminishes your investments might be a bit of a stretch at the moment, it’s never too early to prepare, if you’re worried that this could change down the road.

Here’s three steps you can take to better protect your finances from the possibility of post-pandemic inflation ...

  1.  Investors: Don’t drastically change your approach, but keep a diversified portfolio with some inflation-safe investments

  2. Consumers: Save for poor economic conditions, but don’t keep too much cash on the sidelines

  3. Remember that not all inflation is wallet-harming, so try not to overreact 

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1Foster, Sarah. Bankrate.com. "A post-pandemic boom could cause prices to rise — here's how to prepare." Fidelity.com. 02/11/21. Web. April 2021.

 

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