Ep. 419: Dissecting the New Inflation & Social Security Rates

We want to answer your questions about money. Email us and you may hear yours on the air: askpete@petetheplanner.com

This week on the Pete the Planner Show, Pete and Damian discuss what happens next week when Pete goes on vacation! What do you think, should Damian do the show on his own? Or should we do a “Best Of…” show?

No time to listen?  Here’s a preview of what happened and when:

Show Notes:

MAILBAG QUESTION 1: SHOULD WE STILL INVEST IN STOCKS? [3:00]

  • My wife, 76, and I, 78, are retired. We both have a pension, our house is paid off, and our income greatly exceeds our expenses. We have over $1.2 million invested and we haven’t touched it. We’re conservative investors and got to a point where we want to be done with stock market investing, and don’t want bonds or annuities. We don’t want to think about our money fluctuating in value. We just want to be done. Are we being foolish?

    • DAMIAN: It’s not uncommon to retire with at least as much income as when you were working
    • PETE: Inflation would have to go up a lot to push them to a point where they have to dip into their savings
    • DAMIAN: I think they’ve got tons and tons of wiggle room; start enjoying some of that money

 

INFLATION & SOCIAL SECURITY [12:54]

  • “William has some protection from the rigors of inflation. Every year, there is a COLA (Cost of Living Adjustment) on Social Security retirement benefits. This week, we got an estimate for what that adjustment will be in 2022. It’s expected to be 6.1%. The new estimate from the Consumer Price Index (inflation) from June is over 5%, which is huge.

    • DAMIAN: This year, there will be a very noticeable increase, so good on those collecting Social Security.
    • If we think about the last time we had had a very high inflationary rate, banks responded with very high interest rates for CDs and other financial tools
    • PETE: There was concern this week for inflation to become very problematic for people on the low end of income. The most elementary expense, housing, is unattainable for those low-wage earners
    • DAMIAN: The usual suspects like San Fran and NYC are already bad, but now places like Boulder, CO are pricing out people at alarming rates
    • PETE: Retail rent rates in New York City have fallen for 15 quarters in a row; jarring economic statistics like this don’t jive with the success of the stock market, showing that they are quite different

There’s more segments to check out in the full show! There might be something you can think about.  — click PLAY below.


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