We’ve all felt the pinch — groceries cost more, gas prices swing like a rollercoaster, and your morning coffee somehow jumped a dollar overnight.
Inflation isn’t going anywhere anytime soon, and economists are hinting that 2026 could turn up the pressure even more.
“The current economic situation requires investors to remain composed because inflation rates near 3% and the Federal Reserve implements interest rate reductions,” said Anna Baluch, insurance and finance expert at BestMoney.
The silver lining? You still have time to prepare. Here are some smart financial moves to make now so you’re ready before inflation really starts to bite.
“Your financial situation needs urgent assessment of cash flow and debt management because inflation will decrease your actual investment returns,” said Baluch.
She explained that people who save money should begin by placing their funds into high-yield accounts. These accounts produce returns that exceed inflation rates until their expiration date. This should be done before they should move their money to short-term Treasury bills or certificates of deposit (CDs) for interest rate protection.
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According to Baluch, the interest rate window enables borrowers to exchange their expensive loans for lower-cost, fixed-rate loans and merge different variable-rate debts into fixed-rate loans.
“The current low interest rates create a chance for businesses to establish financial stability instead of using them to take on excessive debt,” she said.
In other words, Baluch said investors need to review their investment portfolios because inflation growth will decrease the purchasing power of their idle funds.
“Investing in different asset classes including equities and inflation-protected securities and real-asset funds helps protect against declining purchasing power,” she noted.
“Financial decisions experience direct effects from inflation and rate changes which occur independently of each other,” Baluch noted.
The current stable conditions make it essential to start early because this approach will maintain future flexibility.
“Financial strength in this environment needs more than Federal Reserve action prediction because it requires a strategy that succeeds in all market conditions,” according to Baluch. This means thinking beyond short-term forecasts and focusing on long-term resilience.
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