How to combat inflation as you see your chicken rice & nasi lemak race towards being $10

Inflation is something everyone is concern about because it affects all of us and our wallets. I am concern as well but not very educated on how inflation works in the long term especially when 'experts' say inflation is temporary/transitory but InvestmentMoat had a simple and nice article explaining it. When I hear news on that inflation is temporary, I am confused because I remember when we had $2 chicken rice (breast meat) once upon a time when I was in primary or secondary school but now, $2 chicken rice is few and rare. So then, it's not like the food owners will raise prices and then drop them down again but after reading the article from InvestmentMoat, I understand what transitory means. The prices might increase more in the short term but over the longer term or in the future, the increase will be less sharp or high.

He also mentioned that inflation in the United States is often measured by the Personal Consumption Expenditure or PCE for short, the PCE increases at a pretty high rate. So then what can we do about it? Besides increasing your salary, I like to also share on how you can beat inflation using other ways!

Invest!

• In Stocks

Stocks have a good inflation hedge over the long term with a positive return of about 7% (buying the S&P 500 index), this is of course for the long term as the stock market is volatile over the short term and your investments will fluatuate. But over the long run, if your stock investments returns turn out good, it should beat inflation but this of course, requires a substantial amount of capital and time horizon.

• In Cryptocurrencies

Many have mentioned that Bitcoin is the best hedge against consumer prices because it is limited in quantity and this means it is valuable based on it's limited supply but of course, it might be a little early to say so but I do definitely find it to be so as we do see companies choosing to have Bitcoin in their balance sheet for example, Square, Tesla, Micro Strategy, Voyager Digital and Marathon Digital Holdings just to name a few. It definitely carries more risks so it really depends on your risk appetite and allocation.

• In Yourself

Improving yourself is definitely what you have been hearing a lot nowadays, from the government to your company, upskilling or upgrading is the way to go to stay relevant or even to switch to a new industry. I am guilty of not improving myself but I like to try out new things which explains this blog and also my Youtube channel. Although I wouldn't say it is doing a great job nor is it worth the effort based on the small revenue I get from it but it forms as a small project that I do on the side. And also because we are staying home so often at home, it helps keep my time occupied.

If you're older and instead want a safer approach to beating inflation, you can also combine a variety of products besides investing in stocks, an annuity is also a great way to preserve your capital. There are definitely different products that can cater to the different needs of an individual and you will need to know your own risk appetite but taking on some risks is necessary, just make sure you have sufficient emergency funds put aside. Hope you guys enjoy today's video. Do hit the like button and subscribe to my channel. Thank you.

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References: https://www.investopedia.com/articles/basics/10/protect-yourself-from-inflation.asp
https://www.youtube.com/watch?v=CTxlBTIVQrw