Planning

Understanding the impacts of inflation

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We help explain the key impacts of inflation

Assuming inflation is 2% per annum, then £1,000 today would only be worth £980 in one year, £817 in 10 years, and £545 in 30 years.

The worth £1,000 over time at 2% per annum inflation

With interest rates currently very low, if you want your money to stay ahead of inflation you may want to consider investments which could potentially give you a higher rate of return (eg equities). Of course, investments always carry the risk that your capital could fall in value and you should aim to invest over the longer term (for at least 5 years).

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Everyone's circumstances are different and what applies to one person may not be right for someone else. The suggestions above are based on a general assumption of each planning event and they are not intended to provide advice or recommendation on your individual financial needs.

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