When many investors think of investment risk, they focus on the stock market, which, as we know, goes through both rising and falling cycles. But there’s more than one type of risk to consider, especially if you’re concerned about the future purchasing power of your retirement funds. And the risk that many investors forget about is inflation, the “silent thief.” Even when your money is in ultra-safe investments like those backed by the US government, inflation is still eating away at your purchasing power, making each dollar in your account today worth less in the future.
In this brief video from Dimensional Fund Advisors, Vice President Joel Hefner provides some surprising historical research to show that having a portion of assets invested to outpace inflation can be important for many investors, and especially those who are saving for a long-term purpose such as retirement.
Stay Diversified, Stay YOUR Course!
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