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Just wanted to pick everyones brains on how to face high inflation rates eroding cash savings. I am quite risk adverse. I have thought about buying commodity ETF like coffee. Not sure about gold as price seems to be peaking? Most of my savings are in big funds like Fundsmith equity but those prices have dipped so it seems on all fronts a challenging environment. What does everyone think??
watching with interest also as my cash is being devalued and the Stocks and shares isa is currently in -ve.
A Solar installation is a reasonable way to directly hedge against energy inflation. Of course, as always there is the chance when jumping on a band wagon that the horse has bolted.
Tricky question...
I have a lot of my savings in S&S's but as I don't need the cash right now, I'm just going to sit it out for now. I think trying to chase returns or safe havens to help negate inflation is difficult, or we'd all be dumping our savings into whatever was offering an easy, safe option.
I'm no expert & IANAIFA, DYOR etc.
https://monevator.com/inflation-hedges/
This may be useful.
Hedging against inflation and assets that beat inflation (over the long term) are not the same thing.
Over the long term equities have delivered above inflation returns.
But that doesn’t mean they’re a hedge against inflation in the short term
As with piha, IMO current losses are immaterial if you don't need to access the savings. I think you're going to struggle to find a low risk investment that's going to keep up with the current inflation rate short term. On the flip side, most investments are quite depressed at the moment so if you're saving mid-long term it's a good time to buy - but keep enough "rainy day" money in a safe place.
@thekingisdead....thanks a lot, that article is very good, will study it....
Seems the market now favours defensive shares but i would not put new money in at the current levels. Having spent years in the red I am thinking of selling up. Whatever you decide if you beat the market you think you are investment God, if you lose, well, a loser.
Good luck and don't over think it.