Solution: Invest in Equities
Over the past several years the annual inflation rate in the U.S. has hovered around 2 percent, according to the Bureau of Labor Statistics. If you don’t want your purchasing power to be eroded by inflation, invest in assets with a higher rate of return to avoid running out of money in retirement.
“The solution is to include equities in your investment mix,” Cheng said. Because you will need your savings to continue to grow while in retirement, you should keep stocks or stock mutual funds in your portfolio even after you retire.
