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Make a game plan for your money during inflationary times in 2022

Posted at 6:25 PM, Feb 07, 2022
and last updated 2022-02-08 12:49:04-05

FARMINGTON HILLS, Mich. (WXYZ) — We’re seeing it everywhere: at the grocery store, the gas pump, and the auto showroom.

“Everyone is just feeling the hurt right now of all these consumer prices that have risen, exponentially, right, everybody’s feeling it,” said. Jennifer Bloom of Bloom Advisors.

The annual inflation rate is now 7% – the highest since 1982 – according to labor department statistics.

We turned to Jennifer Bloom of Bloom Advisors for a game plan for our money during inflationary times.

“I think people need to first get a hold of their expenses,” said Bloom. “The best thing that consumers can do during times like this is to control what they’re spending, what is going out.”

Next, be proactive, especially if you have savings in cash. Jennifer says shop for the best rates for that money.

“If you have debt, high-interest debt, credit card debt, now is the time to really think about paying that down because the Fed has signaled that rates are going to increase. The first people who are going to get hit are going to be consumers,” explained Bloom.

If debt is not a problem and you’re looking to make money on your money with no risk, Jennifer suggests I-bonds.

“This is a product that is designed to help you curb inflation,” said Bloom.

The U.S Treasury issues I-bonds.

“It’s an attractive offer. At 7.12% until April of 2022, which is, you know, probably as good as it’s going to get, it’s a pretty good rate,” said Bloom.

There are stipulations. You can only spend $10,000 per person. The bonds must be held for at least one year. If you see before the 5-year term, there is a 3-month interest penalty. The rate is variable and adjusted twice a year.

“It could be a great product for some, but for others, you, know, better to pay off debt,” said Bloom.

If you own a home and have yet to refinance your mortgage with the still low-interest rates available, Jennifer says that is another must-do.

“Number three is to review your investments,” said Bloom. “We believe in a well-diversified portfolio and well-diversified portfolios can have a fair amount of flex in terms of protecting for inflation.”

Number four: “Stay calm, be smart, fear and greed are the two most common dangerous emotions for investors. You really want to be careful before you make any rash decisions,” said Bloom.