Inflation Affects Your Savings

Inflation constantly erodes the buying power of savings

How are you going to maintain yourstandard of living as you age?

• When looking at a retirement period that lasts 20 to 30 years or more, you have to consider the effect inflation will have on your retirement savings. Planning for 30 years of retirement income is very realistic, especially for a couple
• Inflation constantly erodes the buying power of your savings. To illustrate this point, the price of a cup of coffee in a restaurant has risen 560 per cent and a simple postage stamp has gone up by 637 per cent in 30 years
• If the combination of withdrawals and inflation outstrips investment returns, drawing income in the latter stages of retirement will be difficult
• Two-thirds (67 per cent) of not-yet-retired respondents surveyed feel that cash flow may be tighter or they may have to cut back on spending in retirement.*

FACT: You need to plan for inflation because it will have a major effect on your retirement savings