The half of 2024 has gone, and you are missing a big chance to grow your money if you do not have a good investment plan in place yet. While investing in stocks or other assets, people often fear inflation. The world has been undergoing economic turmoil for a long time. So, investing in such a scenario could be a dilemma for many first-timers or novice investors.
However, sitting idle with your money fearing inflation is not a good thing. While sitting idle, you are not growing wealth adequately for the future. As a result, inflation will eventually hurt you at some point in your life if you are not focusing on growing wealth. This is why this article has come up with five inflation-proof investment ideas in 2024.
Can Investments Be Inflation-Proof?
People invest money to grow wealth, though inflation often neutralizes the wealth you make through investments. Therefore, it is important to understand the investment plans that will not be affected by inflation. Do such investments exist at all? Find a guide to the top five investment-proof investments in the following section.
1. Bitcoin
Cryptocurrency investment has been on the rise in recent years. Bitcoin is regarded as one of the oldest cryptocurrencies, based on a peer-to-peer money system. From a peer-to-peer money system, it has gradually moved to a store or value asset.
Before going into the advantages of Bitcoin, let us have a reminder that this cryptocurrency is known for its high volatility. Therefore, it can fetch you from rags to riches overnight. On the other hand, the good thing is that Bitcoin is inflation-proof since it has a limited supply. Being backed by blockchain technology, this cryptocurrency is not breakable.
Besides Bitcoin, you can also find various other cryptocurrencies. Most of these cryptocurrencies are known as inflation-proof investments. However, invest in them after doing proper research since the volatility is high.
2. Gold
Many people have considered gold as an inflation hedge for a long time. In ancient times, people used to stock gold, as it has remained a precious metal for ages. The price of gold is not as volatile as cryptocurrency. Therefore, it is a safer investment. However, the price of gold may not increase sharply overnight.
According to investment experts and market researchers, gold has been able to beat inflation for the last 15 years. While the Consumer Price Index has increased by 47% since 2009 in the USA, the price of gold has increased by 150%.
3. TIPS
The Treasury Inflation-Protected Securities (TIPS) is one of the safest options to protect against rising inflation in recent years. This fixed-income product is suitable for investors with low-risk tolerance profiles.
TIPS are treasury bonds that will pay a high interest rate when inflation goes up. Similarly, the interest will be lower when the inflation rate comes down. Therefore, it is a proven inflation hedge for investors. Anyone can invest in this for a financially sustainable future.
4. Stock Trading
People typically think that the stock market is often affected by inflation. This perception is not totally true since stocks can provide inflation-adjusted returns to investors. However, it is true that a high inflation spike may have a poor impact on the stock market.
In case you are thinking about investing in gold, you will be surprised to know that stock trading fetches higher returns than gold. Even during the time of an inflation scenario, the stocks can fetch sizable returns for you. There are certain industries that do well when inflation is high. For example, the energy production industry does well when inflation is high. Therefore, investing in the stocks of energy production companies can help you to develop an inflation hedge.
Bottom Line
So, these are some of the inflation-proof investments that you can ponder upon in 2024. Instead of keeping your money in the bank accounts, finding the right investment plans is essential to build wealth for the future. Moreover, a well-planned investment is essential for a situation when inflation is high. Managing your expenses will be simpler when you have invested in inflation hedge funds or stocks or commodities.
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