Lots of people who are now starting to save, they save extra with the aim of avoiding inflation as a person. Maybe you are familiar with the inflation, inflation is a change in prices in general and takes place continuously within a certain period of time. But what you need to know is that if we experience this inflation we can overcome it or we will prevent it personally. To prevent or limit inflation that occurs privately, what you can do is to invest in things that increase in value or that grow in value because the value of the currency may decline in the future. There are many ways you can do to overcome the inflation that occurs. Here are some ways you can prevent inflation:
- Do simple research on prevention of inflation
The first thing we have to do if we want to avoid inflation or want to limit inflation from happening personally, then we certainly have to do short research first on how to prevent inflation such as investing in things that are increasing or growing in value. You must be able to determine whether investment as a preventative investment solution has advantages or not. You have to do short tests and research from time to time so that you can find out how much the profit is and also how much risk you can get.
Some sources that you can get to help with your brief research and testing are several magazines related to the economy such as Money and Forbes. In addition, there are several types of articles on economics and finance such as Investopedia and many more. Investment news will also help you to find out the latest information about investments and even allow you to find and talk with your financial advisor. But if you want to use the services of a certified financial advisor then you have to spend because it will require an hourly fee or maybe what percentage of the investment you will propose.
- Allocate your money to shares
Anyone definitely does not want to if his finances are affected by inflation. Therefore, to avoid the possibility of inflation, you must think of several ways so that you can overcome or avoid the inflation that might occur. First of all, you have to do is try to do a brief research on inflation. After that we will give some tips so you can hedge inflation, the first is by allocating your money to shares. For example, if inflation comes, this could cause the temporary stock market to experience some problems.
If this happens, we recommend that you start to consider reallocating 10% of your portfolio from bonds to stocks to take advantage of this ongoing trend. In addition, the thing that allows another thing you can do is buying shares. And the third alternative that you can think of is utility shares, where this stock price can go up and down and we can predict it through the economic cycle and also pay a stable dividend. So consider again to allocate your money to shares.
- Make loans to senior banks
Actually, there are many ways that you can do to avoid the inflation conditions that might affect your finances. In addition to transferring or allocating money with shares, what you can do next is to make loans to senior banks. By looking at and borrowing from a senior bank, you can get higher returns while protecting your finances from inflation or falling prices if many prices start to increase. So from that what you can do to avoid inflation is to make loans to senior banks, when loans increase, interest rates also start to rise. So if you are still confused, then maybe you can put it on the financial advisor you trust.
- Invest in gold
No one wants to experience inflation, including you. Actually, there are so many ways that can be done so that we can personally avoid inflation. On this occasion we will provide information about one of the easy ways you can do to stem inflation. The way to hedge inflation is by investing, investing in yourself is our way to be able to get profits in the future. There are so many types of investments that we can choose, but what type of investment is suitable for dealing with inflation?
In conditions of inflation, one of the most suitable types of investments is a gold investment. Gold was chosen as one type of investment because of several considerations, because according to various studies conducted by economists. Saying that gold is one type of investment that can beat inflation to reach 54%. Isn’t that a high enough percentage to protect us from inflation? If you feel interested in getting a profit while wanting to be free of inflation, you can invest in gold from now on. If you are interested in following this type of investment, we recommend that you consider the SPDR Gold Share, which can track the price of gold bullion in an update.
- Consider Real Estate Investment
Many types of investments that we can follow and many that benefit you. It turns out that not only gold investment can overcome inflation, other investments that can help to overcome the inflation that occurs are considering real estate investments or REITs. If you want to avoid inflation and want to get a substantial profit from an investment, we recommend that you make a property investment in real estate now. Lots of trusted real estate agents offer investment in you with considerable profits.
Just like the gold, we discussed above, this Real Estate investment is not chosen carelessly. But according to several studies and studies conducted by economists and financial experts, it is said that this real estate investment also can help to limit inflation to reach a percentage of 69% at any time. Is a number large enough to overcome inflation. If you are interested in joining a real estate investment to avoid possible inflation conditions then you can see or consider the Vanguard REF ETF because they have a low-cost ratio.
- Do Life Frugally
To be able to hedge the inflation, it is not always the duty of the government, we as individuals and communities can also start small to help prevent inflation in our country. One that can be done for yourself or personally is to start living frugally. We suggest that from now on you apply the right economical lifestyle. In order for you to be able to save, record every income and expenditure. Look, if the expenditure is swollen and it is felt that it is not too important or urgent, as long as it can be reduced or removed then cut the expenditure so that you can get optimal finance and be able to live frugally
The next step you can do is start limiting the expenses you spend every day. One of the keys that you must do to be able to implement a frugal lifestyle is by discipline and also obeying the rules that you have made yourself. By doing a frugal and not wasteful lifestyle, you can deal with finances well even though conditions are experiencing inflation.
- Be open in your choice
At present we must be creative people in the face of economic development. When inflation is happening and the economic conditions are in a bad condition and maybe the first plan that you have thought about is not going well then all you have to do is make a plan B. When your plan does not go smoothly, you should not just stay quiet but have to make other plans so that you can solve the problem. In order for your finances to remain stable when inflation occurs, you must manage your financial budget well. You have to manage your income and expenditure budget wisely so that your personal finances or family finances can remain stable even though inflation is possible.
If you are open in your financial choices, then you can have an open attitude in changing the financial management system. Don’t stick to one of your financial management systems, but we recommend that from now on you manage your financial management in accordance with the conditions that occur. For example, you change your lifestyle to save expenses in a certain period of time. That way you can get good finances despite inflation.
- Start investment
As we have discussed above, there are several types of investments that are good enough to be able to overcome or limit inflation such as gold investment and investment in property or real estate. According to some studies, it turns out that investment is one of the best ways you can choose to protect your savings money from inflation. Maybe usually a lot of people who have more income will prefer to include the money they have to save in the bank in the form of savings or deposits. But if you dare to take a risk by putting your money in an investment in the form of stocks and bonds, then your finances can grow faster than when you save your money in the bank.
Therefore, from now on we recommend that you start investing, especially for those of you who don’t want to experience inflation. But before choosing the right type of investment, we recommend that you first pay attention to the type of investment you will choose. Because now there are many parties who offer investments with various kinds of benefits and in the end, the investment turns out to be deceptive. Therefore, before choosing, it is better to ask those who are experienced, you can entrust investment to investment managers who are experienced in helping you invest.
- Loan with fixed interest
The last step you can take to limit your personal finances from inflation is by making installments at a fixed interest rate. You can get installments at fixed interest rates from unsecured loans or Islamic bank loans. If in general when we make a loan at the bank then when making installments, usually the interest rates can change. This can be risky when inflation occurs. If the conventional bank or public bank has different interest rates, the Islamic bank usually has a fixed interest rate so that the value of your installments will remain until the installment ends. For example, in the near future, you want to buy a house, instead of choosing an installment in a conventional bank or a commercial bank, we recommend that you move to a sharia bank only so that you can make installments with a fixed interest rate for a specified period of time. This can be one of your methods to overcome inflation that might occur.
That is some information that we can convey to you about how to avoid inflation.There are so many ways you can do it personally to avoid your personal finances from inflationary conditions that might happen. Some of the ways you can do include conducting a brief study of inflation, allocating money to stocks, borrowing from senior banks, investing in gold and real estate, trying to have a frugal lifestyle, being open to your financial choices and the last is installments with fixed interest rates. We recommend that from now on you start doing it so you can avoid inflation. If you are still confused about what you will do, we suggest that from now on you will consult with a financial expert. Hopefully this article useful for you!
