7 Tips for Protecting Your Finances From Inflation
Kanebridge News
    HOUSE MEDIAN ASKING PRICES AND WEEKLY CHANGE     Sydney $1,614,335 (+0.67%)       Melbourne $994,236 (-0.05%)       Brisbane $963,341 (+1.45%)       Adelaide $854,556 (-1.91%)       Perth $827,309 (-0.33%)       Hobart $759,718 (-0.29%)       Darwin $667,381 (+0.62%)       Canberra $1,007,406 (-0.44%)       National $1,037,260 (+0.22%)                UNIT MEDIAN ASKING PRICES AND WEEKLY CHANGE     Sydney $750,961 (+0.91%)       Melbourne $497,942 (-0.57%)       Brisbane $535,693 (+0.31%)       Adelaide $419,051 (-1.28%)       Perth $437,584 (-0.67)       Hobart $516,868 (-0.64%)       Darwin $347,954 (-4.64%)       Canberra $497,324 (-0.10%)       National $524,930 (-0.09%)                HOUSES FOR SALE AND WEEKLY CHANGE     Sydney 10,416 (-208)       Melbourne 14,951 (-211)       Brisbane 8,223 (+52)       Adelaide 2,527 (+10)       Perth 6,514 (+149)       Hobart 1,343 (+29)       Darwin 248 (-7)       Canberra 1,065 (+22)       National 45,287 (-164)                UNITS FOR SALE AND WEEKLY CHANGE     Sydney 8,842 (+1)       Melbourne 8,108 (+15)       Brisbane 1,720 (+26)       Adelaide 459 (+19)       Perth 1,750 (+6)       Hobart 209 (+4)       Darwin 403 (+1)       Canberra 928 (+7)       National 22,419 (+79)                HOUSE MEDIAN ASKING RENTS AND WEEKLY CHANGE     Sydney $790 (+$10)       Melbourne $600 ($0)       Brisbane $630 ($0)       Adelaide $620 (+$20)       Perth $660 ($0)       Hobart $550 ($0)       Darwin $700 ($0)       Canberra $690 (-$10)       National $662 (+$2)                UNIT MEDIAN ASKING RENTS AND WEEKLY CHANGE     Sydney $750 ($0)       Melbourne $590 ($0)       Brisbane $625 ($0)       Adelaide $480 (+$5)       Perth $590 (-$5)       Hobart $470 ($0)       Darwin $550 (+$15)       Canberra $565 (-$5)       National $589 (+$1)                HOUSES FOR RENT AND WEEKLY CHANGE     Sydney 5,061 (-35)       Melbourne 5,308 (+108)       Brisbane 3,854 (+1)       Adelaide 1,161 (-25)       Perth 1,835 (+6)       Hobart 376 (-10)       Darwin 138 (+1)       Canberra 525 (-5)       National 18,258 (+41)                UNITS FOR RENT AND WEEKLY CHANGE     Sydney 6,806 (-66)       Melbourne 4,431 (+62)       Brisbane 1,997 (-30)       Adelaide 323 (-15)       Perth 609 (+30)       Hobart 153 (+3)       Darwin 210 (-15)       Canberra 537 (+30)       National 15,066 (-1)                HOUSE ANNUAL GROSS YIELDS AND TREND       Sydney 2.54% (↑)      Melbourne 3.14% (↑)        Brisbane 3.40% (↓)     Adelaide 3.77% (↑)      Perth 4.15% (↑)      Hobart 3.76% (↑)        Darwin 5.45% (↓)       Canberra 3.56% (↓)     National 3.32% (↑)             UNIT ANNUAL GROSS YIELDS AND TREND         Sydney 5.19% (↓)     Melbourne 6.16% (↑)        Brisbane 6.07% (↓)     Adelaide 5.96% (↑)        Perth 7.01% (↓)     Hobart 4.73% (↑)      Darwin 8.22% (↑)        Canberra 5.91% (↓)     National 5.84% (↑)             HOUSE RENTAL VACANCY RATES AND TREND       Sydney 0.8% (↑)        Melbourne 0.7% (↓)     Brisbane 0.7% (↑)      Adelaide 0.4% (↑)        Perth 0.4% (↓)     Hobart 0.9% (↑)        Darwin 0.8% (↓)     Canberra 1.0% (↑)      National 0.7% (↑)             UNIT RENTAL VACANCY RATES AND TREND       Sydney 0.9% (↑)        Melbourne 1.1% (↓)     Brisbane 1.0% (↑)      Adelaide 0.5% (↑)      Perth 0.5% (↑)        Hobart 1.4% (↓)     Darwin 1.7% (↑)      Canberra 1.4% (↑)      National 1.1% (↑)             AVERAGE DAYS TO SELL HOUSES AND TREND       Sydney 25.8 (↑)      Melbourne 26.6 (↑)        Brisbane 26.8 (↓)     Adelaide 22.5 (↑)      Perth 31.4 (↑)      Hobart 24.3 (↑)        Darwin 26.7 (↓)     Canberra 25.5 (↑)        National 26.2 (↓)            AVERAGE DAYS TO SELL UNITS AND TREND       Sydney 24.5 (↑)      Melbourne 25.5 (↑)      Brisbane 26.1 (↑)      Adelaide 23.6 (↑)      Perth 31.2 (↑)      Hobart 24.6 (↑)      Darwin 38.8 (↑)      Canberra 28.0 (↑)      National 27.8 (↑)            
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7 Tips for Protecting Your Finances From Inflation

Advisors tell savers to adjust their personal-finance strategies to preserve purchasing power.

By Nick Fortuna
Mon, Nov 29, 2021 11:13amGrey Clock 4 min

Is it just a passing phase or here to stay? That’s the question facing consumers who are seeing their purchasing power erode.

There are some steps you can take to protect your finances no matter which way it breaks. Consider buying equities like bank stocks or consumer goods companies that perform well in inflationary periods. Don’t pay off that mortgage early—if we are indeed in an era of sharply rising prices and wages, you’re better off paying it off over time with watered-down dollars. Beware of bonds. If rates rise sharply, their principal value will take a hit.

Economists are split on how long the high inflation will last. Some argue that supply-chain issues caused by the Covid-19 pandemic are temporarily hiking prices, while others say that rising labour costs will result in elevated prices for years.

“That’s obviously the million-dollar question right now,” said Bryan Pinsky, president of individual retirement at AIG Life and Retirement. “There definitely are two camps out there, and there are things going on in the economy that would make you lean one way or the other.”

The Consumer Price Index, which tracks prices for a broad range of products such as gasoline, healthcare, and groceries, rose 6.2% in October from the same month in 2020, the biggest spike since December 1990, according to the Labor Department.

Bruce Brugler, managing director at Tiedemann Advisors, said that in an inflationary environment, “cash is trash” since dollars lose value over time. The problem is that the stock market and real estate have risen sharply in recent months, so investors will have to be more discriminating to find value.

Nevertheless, advisors say there are ways for savers to adjust their investment and personal-finance strategies to preserve their purchasing power. Here are seven tips for living in an inflationary period.

Identify stocks that will benefit from higher inflation or higher interest rates. Banking, consumer staples, energy, utility, and healthcare equities are likely to perform well, says investment advisor Brian Stivers.

Banks would come out ahead if the Federal Reserve eventually raises interest rates to combat inflation, and banks’ spreads between loans and deposits widen. Meanwhile, companies that produce essential consumer goods typically are able to pass on their higher costs to consumers.

Conversely, automotive and housing companies will get stung by rising interest rates that lift borrowing costs for customers. That makes them riskier investments just now.

“I’m a big fan in times like these of sector investing, and that can be done either in individual stocks or with exchange-traded funds,” Stivers said.

Rob Williams, managing director of financial planning and retirement income at the Schwab Center for Financial Research, said International stocks will appeal to investors who are concerned that the dollar will be weakened by inflation.

Shy away from fixed income. If rates climb, then certificates of deposit, fixed annuities, bonds, and bond funds purchased today will look less attractive in the future.

“If the Fed does raise rates, I would be careful about buying any new bonds and probably would wait on the sidelines until those rates start moving up,” Stivers said. “However, there are still some long-term bonds where people are getting yields of 3% or 4%, and you want to hold on to those.”

Similarly, buying a lifetime income annuity is less enticing in an inflationary environment. The monthly check you get for the rest of your life will lose value more quickly with high inflation.

Pinsky, of AIG Life and Retirement, said investors are opting for shorter-duration fixed annuities and equity-indexed annuities, which are tied to the performance of a stock index such as the S&P 500. Equity-indexed annuities provide principal protection for investors with a low-risk tolerance, he added.

Treasury inflation-protected securities, or TIPS, are another option for savers seeking low-risk investments, according to Matt Nadeau, of Piershale Financial Group. With TIPS, the principal increases with inflation as measured by the CPI.

Keep the right sort of debt. Homeowners carrying fixed mortgages with low interest rates are sitting pretty right. If you haven’t already done so, refinancing to lock in low rates is a good idea. If inflation takes off, homes prices are likely to climb and your fixed monthly payment may appear like a real bargain in a few years.

Credit-card debt, on the other hand, is particularly bad in a rising-rate environment. It’s floating-rate debt, and your monthly payments will go up.

Consider commodities. Investing in oil, natural gas, wheat and corn may be good hedges against inflation, said Matt Nadeau, of Piershale Financial Group.

He said ETFs such as the FlexShares Morningstar Global Upstream Natural Resources Index Fund (ticker: GUNR) and the SPDR S&P Global Natural Resources ETF (GNR) give investors a “broad-based opportunity” to take advantage of rising commodities prices, including energy, precious metals and agriculture.

Look for companies that benefit from rising labour costs. Brugler, of Tiedemann Advisors, said energy-service companies and technology companies aimed at reducing businesses’ labour needs might be interesting investments due to high inflation rates.

As an example, he pointed to Toast (ticker: TOST), a cloud-based software company providing a restaurant-management and point-of-sale system built on the Android operating system. As restaurants struggle to recruit and retain workers and are forced to raise wages, technology companies aimed at reducing head count should benefit, Brugler said.

“Think about the sources of inflation, and then identify which companies are helping other companies alleviate that cost pain by providing them with solutions,” he said.

Pull the trigger on essential purchases and charitable giving. If consumers expect to spend money on home goods, renovations, car repairs, or other products and services, they might be better off doing so now, before prices climb even higher, according to Brugler, of Tiedemann Advisors.

Charities also are likely to face higher prices for goods and services in the future.

“To the degree that you’d like your charitable dollars to accomplish something, putting it in the hands of that charity now also makes sense,” he said. “A $1,000 gift today is more valuable to that charity than a $1,000 gift several years from now.”

Brace for rising health costs. Health costs have risen faster than inflation for years. The pandemic, which is driving some health professionals out of the field, could accelerate that trend.

Stivers, of Stivers Financial Services, recommends increasing contributions to health savings accounts, if possible. Workers enrolled in high-deductible health insurance plans typically are eligible for HSAs, which allow savers to set aside money on a pretax basis to pay for qualified medical expenses. Investment gains within HSAs aren’t taxed.



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Australia’s February Inflation Comes in Lower Than Expected

The monthly consumer-price index indicator rose 3.4% in the 12 months to February

By JAMES GLYNN
Thu, Mar 28, 2024 2 min

SYDNEY—Australia’s monthly inflation indicator came in below expectations in February, signalling that price pressures would likely continue to retreat over coming months.

The monthly consumer-price index indicator rose 3.4% in the 12 months to February, according to the latest data from the Australian Bureau of Statistics. Economists had expected a rise in February of 3.5% on year.

Some economists had expected the monthly CPI update to show a bigger rise, fuelled by services inflation which remains an area of concern for the Reserve Bank of Australia.

The better-than-expected inflation outcome will also help offset some of the uncertainty about the outlook for interest rates that arose in financial markets following news last week of a sharp drop in unemployment in February.

The most significant contributors to the February annual increase were housing costs, which climbed 4.6% on year, while food and nonalcoholic beverages rose 3.6% in the same period.

Alcohol and tobacco prices were up 6.1% and insurance and financial services rose 8.4%, the ABS said Wednesday.

Excluding volatile items from the data, the annual CPI rise in February was 3.9%, down from 4.1% in January.

Annual inflation excluding volatile items has continued to slow over the last 14 months from a high of 7.2% in December 2022, the ABS said.

Rents increased 7.6% for the year to February, up from 7.4% in January, reflecting a tight rental market and low vacancy rates across the country.

New dwelling prices rose 4.9% over the year with builders passing through higher costs for labor and materials. Annual new dwelling price increases have been around the 5% mark the past six months, the data showed.

The 3.6% rise in food prices in the 12 months to February was down from the 4.4% in January. It was the lowest annual growth since January 2022.

Insurance costs jumped 16.5% over the past 12 months to February, with rises in premiums across all insurance types due to higher reinsurance, natural disaster and claim costs, the ABS said.

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