Pasquale Sacchetta discusses mitigating inflation’s impact on retirement savings
Listen to the interview on the Business Innovators Radio Network:
Pasquale Sacchetta, the president of CFIG Wealth Management, emphasized a crucial point about inflation – it impacts the value of the currency, not just the prices of goods and services. He explained that inflation signifies a decrease in the value of the dollar, leading to a reduction in purchasing power over time. This insight is vital for individuals to grasp as it highlights the broader implications of inflation on their financial well-being. While many associate inflation with rising prices, understanding its effect on currency value underscores the importance of protecting against its consequences. Pasquale noted that inflation can significantly influence investment decisions, retirement planning, and overall financial stability.
Recognizing that inflation erodes the purchasing power of money enables individuals to make more informed choices regarding their investments and financial strategies. It stresses the need to adjust portfolios, seek higher returns to outpace inflation and consider long-term implications when planning for retirement or other financial goals. This understanding empowers individuals to take proactive steps to mitigate the wealth erosion caused by inflation and make strategic financial decisions.
Pasquale highlighted the importance of adjusting your portfolio strategically to ensure that your returns exceed the impact of inflation. By doing so, you can safeguard your purchasing power and ensure that your investments grow in real terms. This proactive approach involves ongoing monitoring and adjustments to your investment strategy to stay ahead of inflationary pressures.
Furthermore, he emphasized the significance of rebalancing your portfolio while considering risk and volatility. Striking a balance between seeking higher returns and managing associated risks is essential. Simply increasing risk to chase higher returns in an inflationary environment can lead to potential losses.
Pasquale said: “The duration of a bond portfolio is very important. If you go out 30 years, you’re taking the highest interest rate risk and inflation risk there is. So, if you go short term and your duration let’s say, is five years or less, then you’re not taking as much risk on the actual valuations, the changes in the value of the bonds.”
By focusing on long-term goals, regularly reviewing your portfolio, and making informed adjustments, you can mitigate the impact of inflation on your investments. Pasquale’s advice underscores the need for a well-thought-out investment strategy that considers inflation and interest rate risks, ultimately helping you preserve and grow your wealth effectively.
About Pasquale Sacchetta
Mr. Sacchetta is President of Westport-based CFIG Wealth Management, LLC. He is president and an investment adviser representative of Continental Five Investment Group, LLC. He is a CERTIFIED FINANCIAL PLANNER® practitioner, an Accredited Estate Planner professional, and a Chartered Life Underwriter designee. He specializes in retirement planning, estate planning, and business planning.
Mr. Sacchetta is a member of the Estate Planning Council of Lower Fairfield County and the National Association of Estate Planners & Councils (NAEPC). He is a qualifying member of the Million Dollar Round Table, the Premier Association of Financial Professionals®.
Mr. Sacchetta was born and raised in Connecticut. He graduated magna cum laude from Connecticut State University in New Britain, received his MBA from Fordham University in New York City and his Chartered Life Underwriter (CLU) designation from the American College in Bryn Mawr, Pennsylvania. He is a life member of the U.S. Tennis Association and a member of the U.S. Golf Association. He is fluent in Italian.
Mr. Sacchetta was recently named in the newly released editions, and has been named in multiple previous editions, of the Marquis Who’s Who in Finance and Business, the Marquis Who’s Who in the East, the Marquis Who’s Who in America and in the Marquis Who’s Who in the World. He has earned numerous industry awards and distinctions. He has been quoted in local and national media.
Learn More: https://www.cfig-wealth.com/
Investment advisory services are offered through Continental Five Investment Group, LLC, a Registered Investment Adviser, 1555 Post Road East, Suite 206, Westport, Connecticut 06880
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