Managing Your Money During Infation

That the UK is suffering an unprecedented cost-of-living crisis is nothing new. The rising costs associated with energy, food and fuel have been well-documented, with millions of families plunged into poverty as a result of unsustainable rises to the costs of essential goods.

These rising costs constitute a high overall ‘rate of inflation’, which indicates the direction and weight with which prices are rising. The CPI (Consumer Prices Index) currently sits at 8.8%, having been above 10% multiple times throughout the year and having been anticipated to rise even higher before the end of 2022.

This prolonged surge in the rate of inflation has been nothing short of disastrous, and not just for families. Rising inflation has a pseudo-devaluating impact on currency, reducing the spending power of savings and investments. Whether you are a professional investor, budding day trader or simply a shrewd worker hoping to secure the value of your retirement fund, what are the best ways to take care of your money in the midst of high inflation?

Long-Term Savings

Firstly, the most equitable approach for the vast majority of savers is to consider long-term savings products and accounts. The rising rate of inflation has been a leading concern for the Bank of England, which has sought to rase interest rates – with the desired impact being a reduction in both borrowing and spending.

The ancillary outcome of interest rate rises is the increased viability of savings accounts. For the last decade, bank accounts have had woefully small rates of interest, but the recent rises have enabled savers to generate more interest from their cash holdings.


However, long-term savings do not necessarily defeat the impact of inflation, with even the highest rates of interest some percentage points below the current CPI rate. An alternative, then, presents itself through active engagement in the stock market.

Rather than investing directly in a business, fund or asset – which is a risky enough move at the precipice of national recession – you could instead speculate on the movement of certain products through spread betting. This simple method of engaging with the markets enables you to speculate against the success of certain assets just as easily as speculating on success, meaning you can profit both ways from market movements.


Lastly, for those with a relatively large cash holding, there is something of an evergreen investment opportunity in the form of property. Property is one of the more stable forms of investment, as demand near-always outstrips supply. House prices rise as a rule, and in spite of crashes or downturn that may have short-term impacts on property value.

House values are due to crash as a result of rising mortgage costs, but for the shrewd investor this can be considered a discount – and a sure-fire way to outpace inflation in the long-term growth of wealth.