Today’s retirees face a broad range of financial challenges and risks. Market volatility could threaten your savings and ability to generate income. Health care costs could drain your assets. Taxes and other expenses could be higher than expected.

There’s one risk, though, that is easy to overlook. It’s inflation, which is the regular, gradual increase in the price of goods and services. Inflation is driven by a broad range of factors including labor and material costs, interest rates, and overall economic conditions.

Inflation has historically been modest on an annual basis. However, even modest inflation can have a big long-term consequences. An average annual inflation rate of only 3 percent would lead to a doubling of prices over a 24-year period. How would your savings hold up if your expense double over the course of your retirement?

It’s also important to note that inflation doesn’t occur evenly across all sectors of the economy. For example, it’s possible that food prices could increase modestly while utility prices increase at a higher rate. Health care and long-term prices have been known to increase significantly in some years.

The good news is you can minimize the impact of inflation by developing a strategy. A little advanced preparation can help you create a rising income stream in retirement. Below are a few strategies to consider:


Give your savings opportunity to grow.

It’s common for retirees to transition to a more conservative investment approach. After all, you may be dependent on your savings to generate income. If the market declines and you suffer a significant loss, your income could be impacted. Many retirees aren’t comfortable with a high level of risk.

However, just because you’re uncomfortable with risk doesn’t mean you should avoid it completely. In order to increase your income over time, you will likely need some level of growth. Risk and growth often go hand-in-hand. Many investment and savings tools that are perceived to have no risk also have very little growth potential.

Look for strategies that balance risk minimization with growth opportunities. A financial professional can help you find that balance. You also may want to consider annuities, which can sometimes provide downside protection along with upside potential.


Limit your withdrawals from retirement accounts.

Your withdrawal rate is the percentage of your account balance that you take each year as a retirement distribution. The higher your withdrawal rate is, the more growth you will need in your account to maintain your balance. The lower your withdrawal rate is, the more money left in your account to grow and compound and generate future distributions.

You may want to examine your planned withdrawal rate and see if you can slightly decrease it. By lowering your withdrawal rate, you give your funds a better chance to grow. That growth could fund increased withdrawal in the future to fight inflation.


Delay your Social Security filing.

One of the simplest ways to maximize your income in retirement is to delay your Social Security filing. You’re eligible to file for Social Security as early as 62, but your full retirement age (FRA) is likely either 66 or 67. If you file before your FRA, you could see a reduction in your benefits.

However, if you delay your filing beyond your FRA, you could see an increase in your benefit amount. Social Security offers an 8 percent benefit credit for every year past your FRA that you wait to file. The 8 percent credit stops at age 70. However, if you can delay to that point, your could substantially increase your retirement income.1

Ready to develop your inflation protection strategy? Let’s talk about it. Contact us today at Trinity Financial. We can help you analyze your needs and develop a plan. Let’s connect soon and start the conversation.




 Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice.

The insurance agent can provide information, but not advice related to social security benefits. Clients should seek guidance from the Social Security Administration regarding their particular situation. The insurance agent may be able to identify potential retirement income gaps and may introduce insurance products, such as an annuity, as a potential solution. Social Security benefit payout rates can and will change at the sole discretion of the Social Security Administration. For more information, please consult a local Social Security Administration office, or visit

Advisory Services offered through Change Path, LLC an Investment Advisor. Trinity Financial Group and Change Path, LLC are not affiliated.

16766 – 2017/6/20

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