[VIDEO] The Impact of Inflation on Your Retirement Savings

The medical profession refers to high blood pressure as the silent killer. In investing, the silent killer is inflation. The minimum return on any retirement investment must be at least equal to inflation.

Here’s why: Suppose your retirement goal is to withdraw $90,000 per year from your IRA.

To maintain your purchasing power, you must adjust your withdrawal amount for the inflation factor.

That means that to get $90,000 per year at an inflation rate of 3%, your withdrawal amount in year 15 would be $140,217. 

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The views expressed in this commentary are subject to change based on market and other conditions. This video may contain statements that may be deemed forward‐looking statements. Please note that any such statements are not guarantees of any future performance and actual results or developments may differ materially from those projected. Any projections, market outlooks, or estimates are based upon certain assumptions and should not be construed as indicative of actual events that will occur.

Malcolm Ethridge, CFP® is the Managing Partner of Capital Area Planning Group based in Washington, DC. He is also the Managing Partner of Capital Area Tax Consultants. 

Malcolm’s areas of expertise include retirement planning, investment portfolio development, tax planning, insurance, equity compensation and other executive benefits. 

 Disclosures:

The information provided is for educational and informational purposes only, does not constitute investment advice, and should not be relied upon as such. Be sure to consult with your legal advisors before taking any action that could have tax and legal consequences.

Investments in securities and insurance products are:

NOT FDIC-INSURED | NOT BANK-GUARANTEED | MAY LOSE VALUE