Estimated read time: 6-7 minutes
Ronald Reagan famously said, "Inflation is as violent as a mugger, as frightening as an armed robber, and as deadly as a hit man."
You know exactly what he meant because it's hitting you where it hurts.
Every dollar you've saved for retirement doesn't buy nearly as much as it did when you put it into your savings account. You feel the pressure every day, as the cost of everything just keeps going up.
Remember when you could fill up at the gas station for $10 or $20?
And what did you pay for your first car? Your first house? And how does that compare to what you'd have to shell out for a new car or house today?
What about groceries? Or healthcare — where higher prices can literally be a matter of life or death?
Inflation impacts everyone. But if you're in or nearing retirement, it could be financially devastating. Because every dollar spent feels like a much bigger loss when you're living on a fixed income. It's not like you can count on your next paycheck or future wages to make up for it.
And so it shouldn't come as a surprise that InvestmentNews shared an eye-opening financial security report from a Northwestern Mutual study. Writer Leo Almazora said, "An unprecedented number of Americans are reporting a heightened sense of financial insecurity." Inflation continues to wreak havoc on the economy and personal finances.
The study found that just 9%, or less than 1 in 10 Americans, said their household income is staying ahead of rising costs.
To put that another way: 9 out of 10 Americans feel like they're falling behind and losing the battle against inflation.
A recent Gallup poll agreed.
More Americans are worried about inflation today than at any time in the last 20 years. And 4 in 10 mentioned inflation as their biggest concern when asked about the economy and their personal finances.
So, inflation is a serious problem for everyone.
And it's an even bigger problem for the next wave of retirees. So we reached out to Utah retirement advisors Tyson Thacker and Ryan Thacker of B.O.S.S. Retirement Solutions, to get their advice on how to protect your retirement plans against this insidious threat.
They are a five-time winner of Utah's Best of State Award. And since 2008, they've helped thousands of families plan for retirement.
Inflation is as violent as a mugger, as frightening as an armed robber, and as deadly as a hit man.
–Ronald Reagan
"Here's what it boils down to," Ryan Thacker says. "Yes, inflation has come down, but it's not going away. The higher prices we've seen over the last few years are here to stay. And if your financial game plan for retirement doesn't account for inflation, you could be in serious trouble in just a few years."
As a basic rule, the Thackers say you need to plan to double your income every 20 years just to keep up with inflation. So this must be built into your financial game plan.
"If you're fortunate enough to have 10 or 20+ years of retirement ahead of you, you can't just look at today's prices," Tyson Thacker explains. "You must account for higher prices tomorrow."
Social Security checks have lost nearly 40% of their buying power in the last couple decades.
–Ryan Thacker, B.O.S.S. Retirement Solutions
"You can't rely on Social Security and assume everything will be fine, either," the Thackers emphasize.
"Yes, the Cost of Living Adjustment to Social Security is supposed to offset inflation," Ryan Thacker says. "But it's doing a poor job of it. According to Forbes, your Social Security checks have lost nearly 40% of their buying power in the last couple decades. There's no reason to believe that will change going forward."
"In fact, it could get a lot worse," Tyson Thacker adds. "The Social Security Trust Fund is projected to run out of money in less than 10 years. In 2035 they'll only have enough money to cover 78% of promised benefits."
So if you're in or nearing retirement, what can you do to protect your hard-earned savings from inflation?
The Thackers emphasize the need for a diversified approach which they describe as "layers of planning."
"The stock market has historically delivered inflation-beating returns," Ryan Thacker explains. "But that long-term performance also comes with short-term risk. So going all-in on stocks could be very risky. Other assets like commodities and real estate can help protect you against inflation, but they also come with their own challenges."
"There are other, more stable income opportunities for retirees, too," Tyson Thacker says. "There are ways to reduce your taxes in retirement that could save you a small fortune and offset the burden of inflation. So, the key is building a many-layered plan that could give you the stability, growth, and inflation protection you need."
The key is building a many-layered plan… that could give you the stability, growth, and inflation protection you need.
–Tyson Thacker, B.O.S.S. Retirement Solutions
There's no one-size-fits-all solution. Any plan that you come up with needs to fit your timeline, risk profile, current assets, and your retirement goals.
This is part of why the Thackers developed the B.O.S.S. Retirement Blueprint.
This blueprint is customized for your specific situation, and it covers the most important pieces of the retirement planning puzzle, including inflation, taxes, Social Security, healthcare costs, income, IRAs, 401Ks, and more.
Having this plan could be the single most important tool that could make your money go a lot further in retirement.
While other financial advisors charge hundreds of dollars for similar services, B.O.S.S. Retirement Solutions offers this service for free, even if you're not a client yet.
This offering could be especially beneficial for families who have saved at least $200,000 up to a few million for retirement.
To schedule your free, no-obligation B.O.S.S. Retirement Tax-Savings Analysis, call (801) 990-5055, or request your free Retirement Tax-Savings Analysis online here.
All advisors at B.O.S.S. Retirement Solutions are held to a fiduciary standard. This means each advisor is legally required to put your financial needs before their own.
About the authors: Tyson Thacker and Ryan Thacker are the CEO and President of B.O.S.S. Retirement Solutions. They are a five-time winner of Utah's Best of State Award and have six offices located throughout the Wasatch Front.
This is for illustrative purposes only, results may vary. Advisory services offered through B.O.S.S. Retirement Advisors, an SEC-Registered Investment Advisory firm. Insurance products and services offered through B.O.S.S. Retirement Solutions. Information contained in this material is given for informational purposes only, and no statement contained herein shall constitute tax, legal or investment advice. The information is not intended to be used as the sole basis for financial decisions, nor should it be construed as advice designed to meet the particular needs of any individual. You should seek advice on legal and tax questions from an independent attorney or tax advisor. B.O.S.S. is not affiliated with the U.S. government or any government agency. Marketing materials provided by Infinity Marketing Services.
B.O.S.S. submitted applications and paid fees to be considered for the Utah Best of State awards. The award results were independently determined by the awarding organization (https://www.bestofstate.org/about.html) and the information BOSS provided. BOSS received the Utah Best of State award in 2019, 2020, 2021, 2022, and 2023.
