Financial Advisor Richard Paul Explains How Gas Prices and Inflation Affect Retirement Planning
Financial Advisor Richard Paul discusses how higher gas prices and inflation will affect your retirement and income planning.
Novi, MI – December 4, 2012 – Richard Paul, Founder and President of Richard W. Paul & Associates, LLC, 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 Richard Paul.
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 Richard Paul. “I found that quite interesting, because the CPI is blind to market pressures and it excludes taxes which we already know are going up, starting in 2013. My clients who are in retirement face an increase in their cost of living due to higher taxes, and there isn’t any relief for that cost.”
Rich also offered three insights as to how this information impacts 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 worked hard for and have earned.”
For more information on this topic, or to learn how Richard Paul can help, please visit www.rwpaul.com.
About Richard Paul:
As founder and president of Midwest Financial Consultants, and Richard W. Paul & Associates, LLC (a registered investment advisory firm), Rich works to provide comprehensive financial planning strategies to pre-retired and retired individuals, helping them achieve total wealth optimization and a reliable income source in retirement. A firm believer in achieving success through a personalized strategy, Mr. Paul acts as each individual’s financial coach and works to optimize their current financial situation by managing and minimizing financial risks and tax liabilities, and positioning accounts for continued growth, regardless of market volatility.
Rich is the local guest host on the nationally syndicated radio show called, “The Financial Safari,” which airs on WMUZ and WLQV. He now has his own radio show on WJR News/Talk 760 called “The Rich Paul Show: Your Retirement Survival Guide” airing on the last Thursday of each month at 7pm.
Rich is also releasing a book, “The Baby Boomer’s Retirement Survival Guide”, focusing on the transition into retirement, and how to construct a portfolio to give you income for life. He has also been quoted on over 100 dot coms as well as featured as a “Financial Trendsetter” in the USA Today.