Inflation: What it means for your retirement fund right now

2.4.22 - What Inflation Means for Your Retirement

Gold last traded at $1,806 an ounce. Silver at $22.48 an ounce.

NEWS SUMMARY: Precious metal prices rose Friday despite a firmer dollar. U.S. stocks were lifted by upbeat jobs data and the latest Amazon earnings report.

Motley Fool--"In 2021, inflation increased by 7% - its highest point since 1982. This means that $1 at the beginning of 2021 was worth around $0.93 at the end of the year. While virtually everyone could feel this decrease in purchasing power, it's especially impactful for those in or nearing retirement.

Here's what the rise in inflation means for your retirement savings.

Inflation is one of the benchmarks the government uses to determine whether they'll increase retirement account contribution limits and Social Security benefits payouts and if so, by how much....

For payments beginning in January 2022, Social Security benefits increased by 5.9%. So if someone receiving Social Security benefits normally received $1,000 monthly, they could now expect around $1,059....

There's no one-size-fits-all answer regarding how much you'll need in retirement, but a good rule of thumb to follow is to aim to have 80% of your preretirement income to maintain your lifestyle....

Unfortunately for most people, it's nearly impossible to achieve these savings goals without investing. The average interest rate on savings accounts is currently 0.06%....

If you're fairly far out from retirement, the present rise in inflation shouldn't impact your retirement savings much, since you'll be trying your best to avoid spending the money. One of the best things you can do is make sure you're investing your money to keep up with (and hopefully surpass) the inflation levels.

If you're currently retired, you may want to consider cutting down on spending until inflation has slowed down and your purchasing power has increased."