{"id":167200,"date":"2025-06-08T09:06:20","date_gmt":"2025-06-08T09:06:20","guid":{"rendered":"https:\/\/www.europesays.com\/uk\/167200\/"},"modified":"2025-06-08T09:06:20","modified_gmt":"2025-06-08T09:06:20","slug":"pause-these-3-financial-priorities-during-high-inflation-and-focus-on-these-4-instead","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/uk\/167200\/","title":{"rendered":"Pause These 3 Financial Priorities During High Inflation and Focus on These 4 Instead"},"content":{"rendered":"\n

When inflation<\/a> is high, it means that the prices of average goods and services cost more than they did before. This can make it frustrating to figure out the right financial moves to make.<\/p>\n

Find Out: I Asked ChatGPT What Will Get More Expensive When Trump\u2019s Tariffs Go Into Effect, Here\u2019s What It Said<\/a><\/strong><\/p>\n

Read Next: Mark Cuban Tells Americans To Stock Up on Consumables as Trump’s Tariffs Hit — Here’s What To Buy<\/a><\/strong><\/p>\n

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Powered by Money.com – Yahoo may earn commission from the links above. <\/p>\n

While the U.S. inflation rate has actually cooled to a refreshing, and nearly ideal, 2.3%, down from highs seen during the pandemic, prices have not dropped, and newly imposed tariffs by President Donald Trump\u2019s administration threaten to drive inflation up again.<\/p>\n

Rather than panicking, financial experts offered some financial priorities to pause during periods of inflation, and those to focus on<\/a>.<\/p>\n

It might sound counterintuitive, but according to Jamie Ebersole, a CFP, founder \u00a0and CEO at Ebersole Financial<\/a>, you actually want to pause new contributions<\/a> to your savings account and reduce your checking account balance to the lowest possible level (within reason) during high inflation.<\/p>\n

That\u2019s because \u201ccash depreciates very quickly in times of high inflation. Wait until inflation rates have fallen below current interest rates to once again keep significant amounts of money in cash,\u201d he said.<\/p>\n

Be Aware: Trump Isn\u2019t Ruling Out a Recession This Year \u2014 What Could That Mean for Your Wallet?<\/a><\/strong><\/p>\n

High inflationary periods are also not a good time to be dropping extra mortgage payments<\/a> on a fixed rate mortgage, Ebersole said.<\/p>\n

\u201cAs inflation creeps up, the real rate of interest that you pay will decrease, making the loan much more affordable over the longer term,\u201d he said.<\/p>\n

In essence, you will be paying back the loan in the future with depreciated dollars.<\/p>\n

\u201cThe reverse is also true. When interest rates are very low, you should prepay your mortgage to reduce the effect of higher real future interest costs,\u201d he said.<\/p>\n

It\u2019s important to pause your lower-priority items like large renovations and family trips, according to Shalini Dharna, a CPA and owner of Dharna CPA<\/a>. Or these may need to be modified (think staycation or local tourist).<\/p>\n

You may pause cash savings in periods of high inflation, but you should keep investing in the stock market<\/a> in the same periods, Ebersole said.<\/p>\n

\u201cStocks tend to perform well in such periods and they are the best chance you have to grow your assets to keep up with or surpass inflation levels over the intermediate and longer term.\u201d<\/p>\n

Story Continues <\/p>\n

The exception here are bonds, which do not fare well with high inflation. However, I-Bonds or TIPS (Treasury Inflation Protected Securities) are a good investment in times where inflation is higher than expected, Ebersole said.<\/p>\n

\u201cCommodities such as gold and silver also tend to be good stores of value in periods where inflation is high.\u201d<\/p>\n

In times of uncertainty, such as high inflationary periods, it is wise to seek the counsel of a financial planner or advisor, Ebersole said.<\/p>\n

\u201cEveryone\u2019s situation is different and there may be other opportunities to take advantage of higher inflation related to one\u2019s financing choices and asset portfolio.\u201d<\/p>\n

During high-inflationary periods, navigating finances can become exceptionally difficult, Dharna said. Consumers should identify their \u201ctop expenses\u201d and prioritize them. These include things like housing payments and groceries items. \u201cGo through every expense and give it a rank,\u201d she said.<\/p>\n

While retirement savings are always important, Dharna warned, \u201cnot at the expense of having outstanding debt, as your debt is probably at a higher interest rate than your rate of return on investments.\u201d<\/p>\n

Sometimes finding the money to get out of debt is \u201cas simple as cutting cable or another subscription\u201d to provide enough cushion for your higher priority cash-flow items, she said.<\/p>\n

\u201cSlowly, one expense at a time, go through that list and figure out what is your non-negotiable and what may need to temporarily be paused as you navigate the current times.\u201d<\/p>\n

Most importantly, Dharna said, this exercise is hopefully temporary. \u201cThese economic ups and downs have and will come many times in our lifetime.\u201d<\/p>\n

It doesn\u2019t mean you have to give up on any of your larger goals altogether, but it does mean some short-term changes to your financial output.<\/p>\n

More From GOBankingRates<\/strong><\/p>\n

This article originally appeared on GOBankingRates.com<\/a>: Pause These 3 Financial Priorities During High Inflation and Focus on These 4 Instead<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"When inflation is high, it means that the prices of average goods and services cost more than they…\n","protected":false},"author":2,"featured_media":167201,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3090],"tags":[51,69958,1700,69957,69953,14480,69955,478,69956,7577,69954,1757,16,15],"class_list":{"0":"post-167200","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-economy","8":"tag-business","9":"tag-ebersole","10":"tag-economy","11":"tag-extra-mortgage-payments","12":"tag-financial-priorities","13":"tag-inflation-rate","14":"tag-inflationary-periods","15":"tag-interest-rates","16":"tag-jamie-ebersole","17":"tag-pause","18":"tag-treasury-inflation-protected-securities","19":"tag-trump","20":"tag-uk","21":"tag-united-kingdom"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@uk\/114646953728357250","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/167200","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/comments?post=167200"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/167200\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media\/167201"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media?parent=167200"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/categories?post=167200"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/tags?post=167200"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}