Better Financial Health in 15 Minutes (or less!)

How To Protect Your Money From Persistent Inflation

• Stacey Hyde

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Prices didn’t fall back after the spike—they stuck. We unpack what that really means for your wallet and your portfolio, and why a 3 percent inflation trend can quietly double living costs over a couple of decades. From retirees juggling health care and food increases to younger families squeezed by rent, insurance, and child care, we share a practical roadmap to keep spending power intact without retreating into cash.

We walk through a smarter investing playbook: broad, global diversification that reduces concentration risk in the S&P 500, tilts toward profitability, and captures more sources of return. Drawing on factor-aware approaches like those used by Dimensional Fund Advisors, we explain how to balance U.S. and international exposure, why rebalancing matters after long growth cycles, and how to align risk with your real-life goals. You’ll hear when it makes sense to green-light big purchases, when to wait, and how to avoid selling at the wrong time.

Then we get tactical. Shop your auto and homeowner coverage and compare line by line before switching. Audit statements monthly, cancel dead subscriptions, and dispute unauthorized charges quickly. If your income is down, consider targeted Roth conversions to build tax-free options and reduce future RMD pressure. For career builders, make a results-focused case for a raise rather than leaning on inflation alone. For savers at every stage, small increases in contributions today can create outsized freedom later thanks to compounding.

If sticky inflation has you wondering how to stay ahead, this conversation gives you the tools: disciplined diversification, flexible spending, vigilant cost control, and tax planning that creates choices. Listen now, subscribe for more practical money guidance, and share this episode with someone who needs a fresh plan for a higher-cost world.

Envision Financial Planning. 5100 Poplar Avenue, Suite 2428, Memphis, TN 38137. (901) 422-7526. This communication is strictly intended for individuals residing in the United States. Advisory Services offered through Envision Financial Planning, a Registered Investment Adviser.

SPEAKER_00:

Hi, I'm Stacy Hyde, and I'm back with another episode of Better Financial Health in 15 Nights or Less. And today we're going to talk about inflation's sort of sneaky second act. We've all heard that inflation's down, but it hasn't really gone away. And so how you position your portfolio and kind of your overall situation really matters more than ever. Inflation is down this year, but we haven't gone back to what it was before. So I've heard it described as inflation is kind of like the glitter from an art project. You're still finding it everywhere. And so you want to make sure that you're preparing for that and being disciplined about how you approach things as well as sort of what your money's doing for you, how you're investing it, and how you're spending it. So we've kind of moved past inflation being an emergency and it, you know, 9% and you know everything else. But the prices, like I said before, did not go backwards. They're just going up more slowly. But the thing to remember is even at 3%, the cost of everything will double in 24 years. And retirees often feel this more because they're often on a fixed income. And yes, Social Security gets an inflation adjustment, but it lags behind and generally doesn't keep up because retirees usually spend more on health care, food, and things like that of their budget. And so they can be more impacted by that than other folks. And then younger people feel it because oftentimes their salaries don't keep up with how much their rent's gone up, how much their insurance has gone up, and all of those things just add up. And if you're paying for child care, you're certainly seeing it. And so inflation is not dramatic right now, but it is persistent and it is ongoing. And so you can't just rely on, you know, a cost of living raise or necessarily a cola adjustment on your Social Security. You actually need to rely on, if you're retired, you need your portfolio to step up and help you out, which it's been able to do because stocks have been up quite a bit over the last few years. And if you're still working, you can do it by paying attention to your expenses, um, brownbagging it, all the things that we've talked about here before. Um, one of and that's a big part of the reason that we use investments by dimensional fund advisors. They can really help us help our clients be proactive against inflation. They are not index managers, but they're also not active stock pickers, and that helps us sort of keep our clients' portfolios diversified and keeping up with inflation because you need to maintain your future spending powers, and this can come with paying attention to are we buying things on sale? That applies both in the investment world and in um at the store. Because over the last really decade or more, large company growth stocks think the Mag 7, they have really trounced everything. Um, in the US until this year, and then international stocks have been uh the best performer. So it is important to maintain that diversification and to look through that. And as I've said on the podcast before, S P 500 is now considered a non-diversified fund because of the concentration in those top 10 stocks. So it is important to pay attention and to spread your risk around because profitability matters, and especially if inflation is heading up, you want you generally want to own companies that have higher profits. So that's one of the things you're trying to do, and in our case, DFA helps us do that. And one of the other things that you need to think about is if your portfolio is not keeping up with inflation, how are you going to be able to afford your lifestyle in the future? Because an employee that's taking out$5,000 a month in 10 years with a 3% inflation, they need to take out$81,000 a year just to keep pace. So that 60 went to 81. That seems like a big job. And so one of the ways that we do that is we talk about being flexible. So in years that the markets are up, maybe that's the year that you replace the car or do a home remodel or take care of some big maintenance issues. If markets are down, we may encourage holding off on that or sort of staging it out over a couple of years. Because while putting everything in cash can feel safe, cash is not likely to keep up with inflation over time. It really hasn't done that, and inflation is one of those sort of secret risks. So one of the things that you can do is shop your homeowners and car insurance. Those rates have gone up quite a bit, and we're hearing, seen it personally, you really do have to pay attention, shop, maybe talk to an independent agent, maybe talk to um, you know, some of the larger uh companies that have their own agents, you know, thinking the state farms, the farm euros, that type of thing, and compare prices. But before you agree to change, pull out your current policy and line it up and make sure that you're not giving up any coverages that you had already. Um, definitely cut those subscriptions that you're no longer using, um, and just review your credit card statement, your bank statement every month. It's a really good practice and it really keeps you from paying stuff. Or recently I've had a lot more charges show up that weren't authorized, and I've been able to dispute them with my credit card company. So you definitely it's important to look at those and be timely. So the other thing, if for whatever reason your income is down this year, um you may want to consider some small Roth conversions to go ahead and pay the tax on that money so that in the future you have tax-free withdrawals and money in Roth is not subject to required minimum distribution. And it just kind of builds some tax diversification into your portfolio and gives you some flexibility. So, you know, I'm not telling you to just do as I've seen some people in my family do reuse plastic bags, reuse aluminum foil. But if that's your thing, go ahead. But you just really want to make smart financial decisions. And if you're younger, saving more, finding a little bit more doesn't seem like it's gonna make a big difference. I promise you, when you're in your middle 50s, you're gonna be shocked how those small decisions you made earlier in your career really impact um what you have available to you. And it just gives you options and freedom. So, and then if you haven't had a raise in a while, um maybe talk to your boss about uh a raise. Don't I would not lead with um the cost of everything's going higher. I would take stock of what you've done, how you've contributed, um, how you've made the company better because it really is you're trying to appeal to what's in it for your boss because they don't want to replace you, they want you to stay around and continue to contribute. And maybe they just need to be kind of reminded that it's time for you to get that raise. So um don't freak out when markets go down, that's normal. Just continue to contribute. But if you have not rebalanced your account in quite a while, maybe in the last couple of years, it's probably a good time to do that because if you had any allocation to fixed income or really any allocation to anything that wasn't S P 500 or large company growth, it's likely that those have grown above your intended targets in time to rebalance down. But also pay attention, look at capital gains, um, make sure that you're being smart and how you're spreading those out as well. So, like I said, inflation's not dramatic right now, but it is persistent. So it's causing you to need to look at everything and just reevaluate and make sure that you're not steadily losing money over time. Thanks again for tuning in. This has been another episode of Better Financial Health in 15 minutes or less.