In November 2022, the U.S. Bureau of Labor Statistics reported that inflation in October 2022 had risen 7.7% from the year prior. This figure has some analysts warning of a potential recession. Between high inflation and a market downturn, should Americans worry about their retirement portfolios? U.S. Money Reserve takes a closer look at what recent market changes may mean for consumers.

Inflation is defined as the increase in the cost of goods and services over a set period, usually 12 months. This cost increase, in turn, can affect consumers’ retirements. For example, you may find yourself paying more for items than you anticipated when you started saving for retirement, resulting in the need to reassess retirement plans. Those who have already retired may find that increased expenses require them to reduce spending or risk burning through their savings at a faster rate than expected.

Another key consideration when it comes to inflation’s impact on retirement planning is the amount of time a portfolio may need to recover from a market shock should one occur. While younger individuals may be able to ride out a bear market and wait for their stocks or other assets to recoup from any dips, retirees, for example, may need to withdraw funds during times of volatility, resulting in a lack of necessary funds to add to their original retirement plans.

Diversifying Your Portfolio

Sustained inflation can lower purchasing power and leave consumers with less wealth in their portfolios than they had previously planned. As markets remain volatile, it may be critical to reevaluate your portfolio and adjust your financial plans over time. Experts recommend diversifying your portfolio beyond a 401(k) or IRA. Though these types of accounts can be important mainstays of any retirement plan, inflation may diminish the return on paper-based assets like stocks and bonds, which often make up 401(k)s and IRAs.

Diversification can help shield a portfolio by spreading wealth across multiple assets and asset classes, including those historically seen as hedges against inflation and market volatility. For example, many Americans diversify their portfolios with physical precious metals, primarily in the form of legal-tender gold and silver coins, because these are often viewed as safe-haven assets that may respond differently than stocks or other paper-based assets when exposed to the same market factors.

While there’s no perfect solution for combating inflation in a retirement portfolio, some assets have historically shown resilience in the face of rising costs. These include exchange-traded funds (ETFs) that focus on commodities like grain, utilities, and natural resources; real estate; and physical precious metals.

The Precious Metals Option

Historically, precious metals like gold have been known to increase in both demand and price during periods of high inflation and market volatility, often moving in the opposite direction of paper-based assets like stocks. Gold and other precious metals can also be held in a retirement portfolio as part of a self-directed precious metals IRA, with the physical precious metals held in an IRS-approved depository.

During times of current or impending economic uncertainty, you may wish to reevaluate your own retirement portfolio. In the current inflationary environment, for example, diversification with alternative assets like gold and other precious metals may help to hedge against market risks and provide additional protection as you save for retirement.

About U.S. Money Reserve, America’s Gold Authority®

U.S. Money Reserve is one of the nation’s largest private distributors of government-issued gold, silver, platinum, and palladium products.

Founded in 2001, U.S. Money Reserve has grown into one of the world’s largest private distributors of U.S. and foreign government–issued gold, silver, platinum, and palladium legal-tender products. Hundreds of thousands of clients across the country rely on U.S. Money Reserve to diversify their assets with physical precious metals, primarily in the form of legal-tender gold and silver coins and precious metals IRAs.


U.S. Money Reserve’s uniquely trained team includes coin research and numismatic professionals equipped with the market knowledge to find products for precious metals buyers at every level. U.S. Money Reserve goes above the industry standard to provide superior customer service, with the goal of establishing a long-term relationship with each and every one of its customers. U.S. Money Reserve is based in Austin, Texas. Like them on Facebook, connect on LinkedIn, and follow on Twitter.