During periods of high inflation, people often see the value of their money decrease dramatically over time. While this may be scary, it’s important to remember that you don’t have to just sit back and let inflation steal your money from you! In fact, there are several smart investments you can make that will actually make you more money as the rate of inflation rises, keeping your finances safe and sound no matter what the economy throws your way! To help guide you through these financially unstable times, here are 10 smart investments to make when inflation hits.
1) Gold
Gold is a good investment to make when inflation hits because it retains its value over time and has been known as a safe-haven investment. Gold can also be used as collateral and helps diversify your portfolio.
Plus, gold is liquid and easy to trade, which makes it a good option for investors who want more control over their investments.
2) Silver
Silver is a great way to hedge against inflation. It’s also a good investment for long-term growth because it has historically been on an upward trend, meaning that its value goes up as the years go by. One downside is that silver is not liquid and it can be difficult to cash in when needed.
3) Bitcoin
Bitcoin is a cryptocurrency and worldwide payment system. It is the first decentralized digital currency, as the system works without a central bank or single administrator. Bitcoin was invented by an unknown person or group of people under the name Satoshi Nakamoto and released as open-source software in 2009. The system is peer-to-peer, and transactions take place between users directly, without an intermediary. These transactions are verified by network nodes and recorded in a public distributed ledger called a blockchain.
4) Real Estate
Investing in real estate is a great way to diversify your portfolio. The price of homes always goes up, so buying low and then selling high is a smart move. You can find good deals when people are desperate and sell when they’re not. You can buy an apartment building with the goal of renovating it and renting it out, or you could buy a fixer-upper and fix it up for resale–and in the meantime, you’ll be living there for free!
5) Fine Art
Investing in fine art is one of the smartest ways to invest during inflation. Why? It’s an asset that continues to appreciate over time, even during tough economic times. Plus, it has a low correlation with other assets and historically has had low correlations with stocks as well.
6) Treasury Inflation-Protected Securities
Treasury Inflation-Protected Securities (TIPS) are securities that adjust with inflation and can be a smart investment when inflation hits. The interest rate is adjusted every six months based on the Consumer Price Index.
7) Foreign Currency
Foreign currency is a great investment, especially in the face of inflation. With the U.S. dollar depreciating over time, you can take advantage of other currencies that are stable or even appreciating in value. For instance, if you invest $1,000 in euros today and it increases by five percent over the course of a year, your investment will be worth $1,050. If you instead invest your money in U.S.
8) Commodities
Investing in commodities is a smart way to make a profit during inflation. Commodities, such as oil and gold, can be traded on the open market and are more stable than other investments like stocks. If you invest wisely, you will be able to make a profit even if there is significant inflation.
9) High-Dividend Stocks
One of the best investments when inflation hits is high-dividend stocks. These stocks typically offer a higher yield than other investments like bonds and they are also more stable. One of the most popular types of dividend stocks is REITs, which are real estate investment trusts that pay out income every quarter. Some other high-dividend paying stocks include AT&T, Chevron, Coca Cola, and Exxon Mobil.
10) Collectibles
Collectibles are a good investment in times of inflation. One of the easiest ways to do this is by buying vintage items on eBay, garage sales, and flea markets. Other collectibles that are also great investments are stamps, coins and currency from different countries, rare books and signed books. Once you have collected these items for a few months or years, it’s not uncommon for them to make you two or three times as much money as when you first bought them.