Guarding Wealth Against a Silent Threat

What would it be like to be in a tug-of-war… with an invisible opponent? Welcome to the world of inflation – a silent thief that’s been pickpocketing our purchasing power for generations. Ransacking our bank accounts is more accurate. Read on to see what inflation has been doing, and what you can do about it.

When I first started studying about the world of finance, I thought I understood inflation. Things just lost value over time – I mean, your car gets old, so it’s worth less, right? Technology ages, so do most things. I just took for granted that money was like that, too. Yet houses don’t (usually) become worth less with age. Nor does great art. Or antiques – even cars can be worth more over time. I just saw a cherry Nissan 300ZX (coolest 1980s car ever) that the proud owner told me is now worth over a half-a-million dollars. So what causes inflation?

Supposedly, it’s just a few factors that boil down to supply and demand. Like Covid caused a big acceleration in housing prices because no one wanted to sell. What goes up, usually comes down, so now the market is expecting a larger than normal downswing as things normalize, yet we will never return to the previous pricing because… inflation. Let’s look at two important examples in the last 100 years (bear with me if you’re not a history buff – they are both relevant in our lives today!)

Weimar Germany Hyperinflation (1921-1923): Extreme money printing by the German government to pay war reparations led to catastrophic hyperinflation, causing their money to become virtually worthless ($1 USD was worth 4,210,500,000,000 Deutschmarks at one point!) resulting in severe economic and social upheaval, and directly led to the rise of the National Socialist German Workers’ Party, ie. the Nazis, Hitler, and World War II. Now, I’m not predicting where we are headed, but we HAVE increased our money circulation by 80% by printing that much more… since 2020.

US Inflation in the 1970s: A combination of oil price shocks, new expanded monetary policies, and increased government spending led to a whole decade of persistently high inflation rates in the US, peaking at nearly 15% and requiring aggressive interest rate hikes (your mortgage interest rate could have shot to 18%!) to eventually bring it under control. We have arguably had up to 30% inflation in the last year, which is why interest rates have tripled and it’s no accident that you are paying much higher prices for the same items, especially if you’re buying them on credit.

See my point? History doesn’t repeat itself, it just rhymes.

One more important piece of data: Between 1900-1990, the US Dollar lost over 93% of its value. Since 1990, it has lost conservatively, close to another 60%, and some of the multi-millionaires I know say it’s actually closer to 90% again. Yet inflation supposedly is holding at under 3% annually on average – which is no big deal, right???

So what can you do?

Before we go any further, I want to remind you that I am a woman building her wealth, an entrepreneur and a coach. I’m not your money manager, and I’m here to spark your own research, not to give you financial advice or tell you to follow what I’m doing. Got that? OK, so here’s what to do:

Invest Wisely: There are a lot of investments out there that have historically outplaced inflation. Stocks and real estate (and you know I love Bitcoin!) can be powerful weapons in your anti-inflation arsenal.

Diversify: Don’t put all your eggs in one basket. Ever, seriously. Spread your wealth across different types of investments to help manage risk and potentially increase returns.

Private Equity: Loaning your money out to those who aren’t bankable can give you great returns. Just make sure you do your research first! (Ask me how I know)

Get More Educated: Keep an eye on inflation rates and economic trends. These days you can ask AI a LOT of questions, and keep up with trends on YouTube. Just watch anyone who rah-rahs too much or says they are the only one you need to follow. Knowledge is power to learn what’s possible for your wealth.

Invest in yourself! Developing high-demand skills can help you command a higher salary or pricing, potentially outpacing inflation. Investing in a great coach can shortcut your business strategies, eliminate your money blocks, and help you soar past your money ceiling, making inflation much less of a concern for your wealth.

Here’s my challenge to you this week: Look at your own books – your income, your investments, your net worth. Are you inflation-proof? What’s one step you can take to get more education or make one change above to guard against inflation?

Hit reply and let me know – I’d love to support you in your journey!

Love,

Halle