| Inflation | Avant-garde Australian Real estate securities Index (VAP) |
iShares Core S&P/ASX 200 (IOZ) |
MSCI cutting edge International index Equity ETFs (VGS) |
Ethical vanguard Conscious Australian Equity ETF (VETH) |
Global Bloomberg Goods ETFs (BCOM) |
|---|---|---|---|---|---|
| 3.8% | 23.44% | 13.39% | 22.36% | 15.51% | 5.49% |
| Outperformance compared to inflation |
19.64% | 9.59% | 18.56% | 11.71% | 1.69% |
Across the world we see inflation remaining stubbornly high. That’s not good news for mortgage holders, however, even if you’re not paying off a home loan, persistent inflation can erode your savings and ability to build wealth.
Very few Australians have enjoyed the 3.8% pay rise needed to keep pace with the rising cost of living. This is why investing in assets that outperform the rate of inflation remains one of the best ways for Australians to stay ahead.
Growth assets like stocks carry additional risks. So please always consider your investment timeframe and personal risk tolerance before deciding where to invest.
That said, a diversified basket of ETFs is an easy way to grow your wealth and beat inflation. The more you diversify and the longer you stay invested, the better your chances of beating inflation, building wealth through compounding returns, and overcoming market volatility.
This article first appeared on InvestSMART. You can sign up to get a free newsletterwith fortnightly insights from the InvestSMART team of experts including Paul Clitheroe and Effie Zahos.
