Financial Advisor Michael Canet, JD LLM Explains How Gas Prices and Inflation Affect Retirement Planning
Financial Advisor Michael Canet discusses how higher gas prices and inflation will affect your retirement and income planning.
Glen Burnie, MD – December 4, 2012 – Michael Canet, JD LLM, Founder of Prostatis Financial Advisors Group, LLC and the Estate and Elder Planning Center of Maryland, recently discussed how gas prices will affect your retirement planning and how inflation is a “stealth tax” waiting to happen.
“Gas prices affect us in many ways. The vast majority of what we eat and what we wear gets to stores by long haul truck delivery. For example, higher oil prices increase the production cost of fertilizers and food processing and these higher costs are passed on to consumers in the form of higher prices at the grocery store. As these cost increases ripple across multiple supply chains, they can push core inflation higher,” remarked Michael Canet.
The inflation rate in America is based on the Consumer Price Index (CPI) and is calculated by the government monitoring a “market basket of goods and services” to accurately index the cost increases we all deal with over time. The Bureau of Labor Statistics explains that the CPI represents all goods and services purchased for consumption by the reference population. These goods and services are broken into major categories such as Food/Beverages, Housing, Apparel, Transportation, Medical Care, Recreation, Education/Communication and others.
“The CPI does not include investment items, such as stocks, bonds, real estate, and life insurance, since these items relate to savings and not to day-to-day consumption expenses,” explained Michael Canet. “I found that quite interesting, because it is blind to market pressures and it excludes taxes which we already know are going up, starting in 2013. So, my clients who are in retirement face an increase in their cost of living due to higher taxes, but there isn’t any relief for that cost.”
Michael also offered three insights as to how this information informs the retirement-planning strategies for his clients. “First, taxes are undoubtedly going up. Second, regardless of economic maneuvers (what they call quantitative easing), what our clients buy is likely to get more expensive – even if the government’s ‘basket’ doesn’t want to own that reality. Finally, we keep a close eye on our income-planning strategies, so that the retirees who place trust in us can continue to live the lifestyle they earned.”
For more information on this topic, or to learn how Michael Canet, JD LLM can help you, please visit www.ProstatisFinancial.com.
About Michael Canet:
Michael Canet is the Founder of Prostatis Financial Advisors Group, LLC as well as the Estate and Elder Planning Center of Maryland. For over a decade, Canet has been building a reputation in retirement planning and asset preservation for families and retirees.
Michael Canet is the author of Amazon #1 best-seller, Surviving the Perfect Storm: How to Create a Financial Plan That Will Withstand Any Crisis, and the host of The Savvy Investor on WMAR, WBAL and WCBM. He is also the winner of a 2012 National Quilly Award. Canet holds public seminars focusing on financial and legal aspects of retirement planning, the economics of long-term healthcare and asset preservation, and frequently appears on television as a tax and financial expert.
In 2010, the Governor of Maryland appointed Canet to the State Board of Individual Tax Preparers. He is widely recognized in Maryland and beyond as a specialist in retirement planning.