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Rising living costs have been a persistent concern for Americans. Now, President Donald Trump is once again claiming that prices are coming down \u2014 but the latest inflation data tell a more complicated story for your wallet. <\/p>\n
During remarks in Ohio on Aug. 11, Trump said that “prices are dropping fast,” while also touting the stock market and employment (1). The comment came as the latest government data showed inflation had eased slightly in July. <\/p>\n
Must Read <\/p>\n
But there’s an important distinction between inflation slowing and prices actually falling. The latest data show that while the rate of inflation has cooled from its pandemic-era highs, the overall price level is still rising. <\/p>\n
The Consumer Price Index (CPI) rose 3.4% in July from a year earlier, down slightly from 3.5% in June but still well above the Federal Reserve’s 2% target. Prices also rose 0.1% from June to July (2). <\/p>\n
Some prices did fall in July. Gasoline dropped 2.9%, grocery prices fell 0.1% and car insurance declined 0.3%. But other costs continued to climb, including shelter, health care and airline fares. <\/p>\n
In short, Americans are still feeling the “affordability squeeze” \u2014 even as the pace of price increases has moderated. <\/p>\n
So, what’s going on here? Here’s a closer look at inflation in 2026 \u2014 and how you can capitalize on it. <\/p>\n
Inflation is still elevated <\/p>\n
There’s an important catch to Trump’s claim. Inflation is nowhere near its 9.1% peak from June 2022, but prices aren’t actually falling across the board. They’re still rising \u2014 just at a slower pace (3). <\/p>\n
It’s worth pointing out that despite inflation cooling, it still remains above the Federal Reserve’s 2% target. That means it’s still technically higher than the Fed wants it to be. <\/p>\n
And the Fed isn’t declaring victory, either. In its latest statement, the Federal Open Market Committee said that “inflation remains elevated relative to the Committee’s 2 percent goal” (4). The Fed also held its benchmark interest rate steady at 3.5% to 3.75%, with three policymakers actually voting for a rate hike. <\/p>\n
The latest numbers aren’t exactly great news for workers, either. After accounting for inflation, average hourly earnings were down 0.2% from a year earlier in July, according to the Bureau of Labor Statistics (3). <\/p>\n
In other words, paychecks aren’t going as far as they were a year ago. That can make it tough for households to feel much relief, even when inflation is cooling. <\/p>\n
However, Trump has pointed to paychecks as a sign of his administration’s success. <\/p>\n
“You’re getting lower prices, bigger paychecks \u2026 you’re getting much higher wages,” he said at the rally in Pennsylvania (5). <\/p>\n
Wages are indeed rising, though perhaps not at the pace implied. <\/p>\n
According to the Bureau of Labor Statistics, Americans’ wages and salaries increased 3.3% over the 12 months ending in December 2025 \u2014 roughly keeping pace with inflation, but not dramatically outpacing it (6). <\/p>\n
And then there’s the stock market \u2014 and the retirement accounts tied to it. <\/p>\n
Trump has also pointed to rising 401(k) balances as a sign Americans are doing better financially. Fidelity found the average 401(k) balance hit $141,000 in the first quarter of 2026, up 11% from a year earlier but down 4% from the previous quarter as markets wobbled (7). <\/p>\n
That’s good news for retirement savers, but it doesn’t mean everyone is feeling richer. A 401(k) can grow while everyday expenses are still eating into your budget \u2014 and market gains can disappear quickly when stocks fall. <\/p>\n
So the picture is a little more complicated: Inflation is cooling, but prices are still high and paychecks aren’t necessarily going as far. <\/p>\n
The good news? History shows that investors don’t have to rely on perfect policy or ideal economic conditions to protect their purchasing power. <\/p>\n
Across cycles \u2014 and regardless of who occupies the White House \u2014 savvy investors have found ways to shield themselves from inflation’s bite. <\/p>\n
Read More: <\/strong>Millionaires under 43 hold only 25% of their wealth in stocks. Here’s where their money is actually going<\/strong><\/a> <\/p>\n A classic safe haven <\/p>\n When it comes to preserving wealth and fighting inflation, few assets have stood the test of time like gold. <\/p>\n Its appeal is simple: Unlike fiat currencies, the yellow metal can’t be printed at will by central banks. It’s not tied to any one country, currency or economy and in times of economic turmoil or geopolitical uncertainty, investors often flock to it \u2014 driving prices higher. <\/p>\n Over the past 12 months, the price of the precious metal has surged by over 40% (8). <\/p>\n Ray Dalio, founder of the world’s largest hedge fund, Bridgewater Associates, has repeatedly emphasized gold’s importance in building a resilient portfolio. <\/p>\n “People don’t have, typically, an adequate amount of gold in their portfolio,” Dalio told CNBC in 2025 (9). “When bad times come, gold is a very effective diversifier.” <\/p>\n JPMorgan Chase CEO Jamie Dimon has also struck a bullish tone, suggesting that in the current environment, gold could “easily” rise to $10,000 an ounce (10). <\/p>\n Grabbing a golden bull by the horns <\/p>\n One way to invest in gold that also provides significant tax advantages is to open a gold IRA with the help of Priority Gold<\/a>. <\/p>\n Gold IRAs allow investors to hold physical gold or gold-related assets within a retirement account, which combines the tax advantages of an IRA with the protective benefits of investing in gold<\/a>, making it an attractive option for those looking to potentially hedge their retirement funds against economic uncertainty. <\/p>\n To learn more, you can get a free information guide that includes details on how to get up to $10,000 in free silver<\/a> on qualifying purchases. <\/p>\n A time-tested income play <\/p>\n Like gold, real estate has also proven to be a powerful hedge against inflation. <\/p>\n The reason is simple: When inflation rises, property values often increase as well, reflecting the higher costs of materials, labor and land. At the same time, rental income tends to go up, providing landlords with a revenue stream that adjusts for inflation. <\/p>\n The present is no exception. Over the past five years, the S&P Cotality Case-Shiller U.S. National Home Price NSA Index has jumped nearly 40%, reflecting strong demand and limited housing supply (11). <\/p>\n Of course, high home prices can make buying a home more challenging, especially with mortgage rates still elevated. And being a landlord isn’t exactly hands-off work \u2014 managing tenants, maintenance and repairs can quickly eat into your time (and returns). <\/p>\n No need to get your hands dirty \u2014 or wet <\/p>\n But there’s good news on the housing horizon: You don’t need to buy a property outright \u2014 or deal with leaky faucets \u2014 to invest in real estate today. Real estate investment platforms like Arrived<\/a> offer an easier way to get exposure to this income-generating asset class. <\/p>\n Backed by world-class investors, including Jeff Bezos, Arrived allows you to invest in shares of vacation and rental properties<\/a>, earning any passive income without the extra work that comes with being a landlord. Plus, when or if the property sells, you get a cut too. <\/p>\n To get started, simply browse through their selection of vetted properties<\/a>, each picked for their potential appreciation and income generation. Once you choose a property, you can start investing with as little as $100<\/a>, potentially earning quarterly dividends. <\/p>\n Seeing the light \u2014 of multifamily and industrial real estate <\/p>\n Accredited investors can now tap into this opportunity through platforms such as Lightstone DIRECT<\/a>, which gives accredited investors access to single-asset multifamily and industrial deals. <\/p>\n Lightstone DIRECT’s direct-to-investor model<\/a> ensures a high degree of alignment between individual investors and a vertically-integrated, institutional owner-operator \u2014 a sophisticated and streamlined option for individual investors looking to diversify into private-market real estate. <\/p>\n With Lightstone DIRECT, accredited individuals can access the same multifamily and industrial assets<\/a> Lightstone pursues with its own capital, with minimum investments starting at $100,000. <\/p>\n ‘The only thing that’s really going up big’ <\/p>\n Back in December 2025, Trump said, “I mean, the only thing that is really going up big, it’s called the stock market and your 401(k)” (5). <\/p>\n Aside from traditional assets like gold and real estate, what other options do you have for hedging against inflation? <\/p>\n Trump’s claim may sound like a quip, but many market experts still agree that stocks can play a role in protecting portfolios during periods of inflation. <\/p>\n For example, Mike Wilson, chief investment officer for Morgan Stanley, recently told Reuters that in the current environment, “high-quality equities and gold are the best hedges” (12). That’s because when companies are able to raise prices to offset rising costs, stocks can serve as an inflation hedge, allowing their revenues and earnings to grow alongside inflation. <\/p>\n Of course, not all stocks are the same. For investors who don’t want the pressure of correctly picking winners and losers, there’s a simpler way to gain exposure to high-quality companies \u2014 one endorsed by legendary investor Warren Buffett. <\/p>\n “In my view, for most people, the best thing to do is own the S&P 500 index fund,” Buffett has famously stated (14). <\/p>\n The beauty of this approach is in its simplicity: It gives investors exposure to 500 of America’s largest companies across a wide range of industries, providing instant diversification without the need for constant monitoring or active management. It provides consistency. <\/p>\n A consistent way to invest <\/p>\n Moby<\/a> offers expert research and recommendations to help you identify strong, long-term investments backed by advice from former hedge fund analysts. <\/p>\n In four years and across almost 400 stock picks, their recommendations have beaten the S&P 500 by almost 12% on average. They also offer a 30-day money-back guarantee. <\/p>\n Moby’s team spends hundreds of hours sifting through financial news and data to provide you with stock and crypto reports delivered straight to you<\/a>. Their research keeps you up-to-the-minute on market shifts and can help you reduce the guesswork behind choosing stocks and ETFs. <\/p>\n Plus, their reports are easy to understand for beginners, so you can become a smarter investor in just five minutes<\/a>. <\/p>\n How to fight inflation without a paycheck <\/p>\n Finally, Trump’s claim about “higher wages” leaves out a large segment of the population: retirees who are no longer earning a paycheck. And for them, inflation can hit especially hard. <\/p>\n As you get closer to retirement, every dollar starts to matter more. Rising health care costs, uncertain markets and fixed incomes can make it harder to stretch your savings \u2014 especially if you’re trying to plan for decades ahead. <\/p>\n And even when some prices fall, retirees can still feel the squeeze if the overall cost of living remains elevated. A lower gasoline or grocery bill in one month doesn’t undo the higher price levels built up over years. <\/p>\n How retirees can take advantage of discounted prices <\/p>\n That’s why you might want to consider joining an organization focused on America’s aging population and one well-known option is AARP<\/a>. <\/p>\n AARP offers members discounts on almost everything \u2014 from prescriptions and dental plans to travel, entertainment and insurance. <\/p>\n As one of the most trusted organizations for older Americans, AARP not only offers money-saving perks, but they can also help you make informed financial and health decisions. AARP members get access to guides that can help you make the most of Social Security<\/a>, choose the right Medicare plan and uncover other government benefits \u2014 potentially saving you thousands along the way. <\/p>\n Sign up with AARP today and get 25% off your first year<\/a>. <\/p>\n – With files from Laura Grande. <\/p>\n You May Also Like <\/p>\n Join 250,000+ readers and get Moneywise’s best stories and exclusive interviews first \u2014 clear insights curated and delivered weekly. Subscribe now<\/strong><\/a>. <\/p>\n Article sources <\/p>\n We rely only on vetted sources and credible third-party reporting. For details, see our <\/a>editorial ethics and guidelines<\/a>. <\/p>\n RollCall.com (1<\/a>); U.S. Bureau of Labor Statistics (2<\/a>), (3<\/a>), (6<\/a>); Federal Reserve Board of Governors (4<\/a>); YouTube (5<\/a>); Fidelity (7<\/a>); GoldPrice (8<\/a>); @CNBCInternationalLive (9<\/a>); @fortune (10<\/a>); S&P Global (11<\/a>); Reuters (12<\/a>); CNBC (13<\/a>) <\/p>\n This article provides information only and should not be construed as advice. It is provided without warranty of any kind. <\/p>\n","protected":false},"excerpt":{"rendered":"Moneywise and Yahoo Finance LLC may earn commission or revenue through links in the content below. 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