In order to preserve the purchasing power of your funds in the face of rising prices, you need to employ inflation protection techniques. Here are five strategies to help you protect your financial assets:
1. Invest in inflation-protected Treasury bonds. These government bonds maintain their value in an inflationary environment because their yields adjust to inflationary changes.
2. Real Estate Investments. The normal increase in real estate prices in an inflationary environment makes such investments an effective way to hedge risk. These can be either purchases of rental properties or investments in real estate investment trusts (REITs).
3. Investing in stocks of companies with stable dividend growth. Some consistently performing companies with growing dividends can provide inflation protection for your funds. A steady increase in dividends over time can help offset losses from inflation.