Prices are rising. Inflation is back. Yet household savings are at record levels, earning zero rates of interest, and slowly but surely losing their real value. It’s important that you and your money don’t remain frozen in time. Here’s how to beat inflation.

1. Invest in equities

Apart from an emergency fund, hoarding cash in bank accounts or state savings or prize bonds is not a good idea. You need to take some risk to earn a return. A globally diversified equities investment will undoubtedly deliver returns that beat inflation in the medium to long term.

2. Increase pension contributions

Pension contributions not only provide the stock market growth I’ve just mentioned but also a generous helping of tax relief. A €1000 investment costs as little as €600 and it grows tax free until you retire. A sure-fire inflation buster – if you don’t need the money until retirement.

3. Overpay the mortgage

Overpaying your mortgage can bring piece of mind and reduce monthly outgoings – but if you have a low mortgage interest rate it makes economic sense to leave it be.

4. Pay off debt

Unlike your mortgage, other debt, particularly credit card debt, is much more expensive. That means it makes absolute sense to use excess bank cash to pay off this debt and avoid what can be crippling rates of interest.

5. Upsize your home

Apart from equities, the one other asset class that truly beats inflation over time is property (the jury is out on gold and crypto). While the Irish property market is as difficult to negotiate as ever, using spare cash (along with a low fixed rate mortgage) to upsize your home is my final tip on how to beat inflation.


If you like this article, try this one: How to Invest