Inflation Creeping into Personal Finances

With the rapid rate of inflation over the last year, consumers certainly feel the affect on their personal finances.  As a Financial Advisor in Murfreesboro, TN, we've been having conversations with clients about the anticipation of rising interest rates for many years.  However, we've just seen significant inflation come to fruition over the last 12-18 months.

If you have a balance on a credit card or an adjustable rate mortgage, you might be noticing changes in your payments. Higher interest rates are starting to ripple through the personal finance landscape, and it doesn’t look like that trend will change anytime soon. 

The Federal Reserve has indicated its plans to keep raising short-term interest rates to help manage inflation, which is at its highest level in 40 years. You’re likely seeing the effects of inflation when buying gas or groceries, and you’ll notice it if you are shopping for a new or used car.  Investors face an important question: Is the era of easy money coming to an end and how will this affect my investments? As usual in the financial markets, the answer isn’t always simple.

The Federal Reserve’s job is to control inflation. By raising interest rates, the Fed hopes to slow spending, bringing down consumer prices.  

Time will tell whether higher interest rates will prompt us to consider changes to your portfolio. Within actively managed portfolios, your overall strategy considers that there will be transition periods in the economy and expects times such as these.

If you have any questions about inflation or interest rates, please reach out.  As a Financial Advisor located in central TN, we serve clients near and far to help them achieve long-term success as the market and economy changes over time. We’re always here to provide guidance and help put things into perspective.