With unpredictable markets comes the matter of how to protect against inflation. Inflation can sneak up on you, and before you know it, the cost of living has jumped while wages have stagnated. But what can you do to combat this? Do you reassess your portfolio? Make changes in your personal or business finances? Here are three tips on how to protect yourself against inflation:

1. Invest in stocks – Regardless of the hesitation that a lot of people have about stocks, owning some equities can be beneficial in protecting yourself from inflation. The simple idea of business success is that companies will sell their wares at growing prices, which will result in increased earnings, revenues and stock prices. Commodity resource companies are always a good bet during inflation as goods like oil, metal and grain tend to experience pricing power during inflation.

2. Invest in property – Real estate is usually a relatively safe investment and can help you reduce the effects of inflation. Housing prices have (generally) risen dramatically since the 1970s (apart from a small dip in the mid-2000s) and have well and truly kept up with inflation. In some places, they’ve risen at a greater rate than inflation. Renting out your investment property is also a good way to counteract inflation with some added revenue.

3. Fixed interest rates on your liabilities – Many of our biggest expenses are mortgages and other fixed loans such as a car repayments. Fixing the rate of interest on these liabilities can go a long way in protecting you against inflation. If your car loan or mortgage is fixed, your expenses are certain regardless of inflation.

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