Shawn Mercer discusses Inflation & Rising Living Costs
Listen to the interview on the Business Innovators Radio Network: https://businessinnovatorsradio.com/interview-with-shawn-mercer-founder-of-mercer-financial-group-discussing-inflation-rising-living-costs/
In this episode of Influential Entrepreneurs, host Mike Saunders welcomes Shawn Mercer, founder of Mercer Financial Group, to discuss the pressing issues of inflation and the rising cost of living. Shawn shares his background in the financial services industry, highlighting his journey from being licensed in insurance in 1994 to owning a registered investment advisory firm in Colorado. He emphasizes the importance of understanding challenging financial topics like inflation to reduce fear and create actionable plans.
Inflation is a persistent economic phenomenon that diminishes the purchasing power of money over time. For retirees, grasping the effects of inflation on their retirement portfolios is essential, as it directly influences their ability to maintain their standard of living throughout retirement. In a recent podcast episode featuring Shawn Mercer, several key considerations for retirees regarding inflation management within their investment strategies were discussed.
In recent years, many individuals have experienced the tangible effects of inflation, particularly in everyday expenses such as groceries. Shawn Mercer highlights that the cost of living has risen significantly, making it crucial for retirees to understand that the money they have today will not stretch as far in the future. For instance, a retiree who plans to withdraw a fixed amount each month may find that the purchasing power of that amount diminishes over time due to inflation.
One of the primary strategies to combat inflation is to ensure that a portion of a retirement portfolio is invested in equities. Mercer emphasizes that equities are one of the few asset classes capable of outpacing inflation over the long term. While it is common for financial advisors to recommend a more conservative approach as individuals age, this can be detrimental for those who may live into their 90s. Retirees need to balance their portfolios to include growth-oriented investments that can help preserve their purchasing power.
The Multi-Bucket Strategy
To effectively manage inflation risk, Mercer advocates for a multi-bucket strategy. This approach involves creating different “buckets” of investments to provide income and growth. For example, retirees should have a safe and guaranteed bucket that can cover their income needs for several years, regardless of market fluctuations. This allows them to avoid withdrawing from their equity investments during market downturns, which can lead to a cycle of selling low and missing out on potential recovery.
Additionally, having a second bucket that includes bond alternatives or other income-generating assets can further diversify the portfolio and provide stability. By replenishing the safe bucket during favorable market years, retirees can maintain their lifestyle while ensuring that their investments are positioned to grow and keep pace with inflation.
Shawn explained: “The importance of regularly reviewing and adjusting retirement plans. Economic conditions, inflation rates, and personal circumstances can change, necessitating updates to the investment strategy. Retirees should aim to review their plans at least annually, or even quarterly, to ensure they remain aligned with their goals and the current economic landscape.”
In summary, understanding the impact of inflation on retirement portfolios is vital for retirees who wish to maintain their purchasing power over time. By incorporating equities into their investment strategies, utilizing a multi-bucket approach, and regularly reviewing their plans, retirees can better position themselves to navigate the challenges posed by rising costs. As Mercer aptly points out, planning for the worst while hoping for the best can provide a sense of security and peace of mind in retirement.
Video Link: https://www.youtube.com/embed/2DiK-FAbR5A
About Shawn Mercer
Mercer Financial Group is a full-service financial services firm committed to helping individuals, families, and business owners build confident, sustainable financial futures. Based in the Wichita Metro Area and proudly serving clients nationwide, we specialize in personalized retirement planning and long-term investment strategies designed to balance growth with safety.
With a comprehensive suite of services—including retirement plan design, portfolio management, and access to a wide range of investment options such as stocks, bonds, and other diversified assets—Mercer Financial Group provides the guidance clients need to navigate every stage of their financial journey. Our approach centers on understanding each client’s goals, risk tolerance, and vision for retirement, allowing us to create tailored strategies that support both wealth accumulation and preservation.
At Mercer Financial Group, we believe retirement should be lived with confidence. Our mission is to empower clients with clarity, thoughtful planning, and trusted expertise so they can enjoy the financial security they’ve worked hard to achieve.
Learn more: http://www.mercerfg.com/
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