As a conservative wealth management planner with DeRosa & Associates Inc. in Jamestown, Tennessee, Chester “C. Edziu” Pacana designs tax-free retirement strategies while satisfying a host of additional professional obligations. Chester Pacana’s areas of knowledge include utilizing investment pathways to beat inflation, which can erode savings over time.
Reflecting the increasing cost of goods and services over time, inflation is a constant that impacts spending power when one holds savings of a set value. According to the United States Department of Labor, inflation has averaged 3 percent annually over the past century, which is why salaries, as well as costs, are significantly higher than they were a generation ago. One misleading aspect of this equation is the significant, often sharp increases and decreases that occur along the way, amidst periods in which very little changes from year to year. One example of a sustained drop in inflation was during the Great Depression of the 1930s, as consumer demand bottomed out. Conversely, the oil crisis caused significant inflation increases in the 1970s and 1980s. Even relatively small inflation rate increases can have a dramatic price impact over the long term. For example, a 3 percent inflation rate over the course of two decades will increase average home prices from around $275,000 to nearly $500,000. For this reason, Chester Pacana and his associates recommend risk-adverse investment strategies designed to grow wealth at a faster rate than that of inflation.
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AuthorChester Pacana - Experienced Conservative Wealth Management Planner. Archives
July 2019
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