The Money Moves Helping Me Beat Inflation

I still remember the moment I realized how real inflation had become: I was standing in the grocery store holding a $7 carton of eggs. Not organic. Not cage-free. Just regular eggs. I laughed out loud, partly because it was absurd—but mostly because I felt powerless.

That moment kicked off a deep dive I didn’t know I needed. As a guy who’s all about streamlining life and cutting friction (hello, I'm Dex), I couldn’t sit back and let my money quietly shrink. So I started testing strategies, reading up on everything from TIPS to side hustles, and restructuring my finances to not just survive inflation—but outsmart it.

Here’s what I’ve learned—and what I wish I’d known earlier.

When Your Money Starts Shrinking (and What to Do About It)

Ever feel like your money just doesn’t go as far as it used to? Well, you’re not imagining it. As stated in a Federal Reserve Bank of St. Louis analysis, $1 in 2000 had the same buying power as about $1.72 in 2023.

That’s over 40% of the dollar’s value gone in just two decades. Inflation does this quietly, eating away at your cash without you even realizing it. Below, we’ll dig into what inflation really means for your wallet and, more importantly, what you can do to fight back.

1. How Inflation Works (and Why It’s So Sneaky)

Inflation isn’t just rising prices. It’s your purchasing power shrinking—meaning your money buys less over time. Picture your paycheck as a block of ice. Inflation is the slow melt. The longer it sits, the less you’ve got to work with.

2. A Quick Look Back: Historical Inflation Rates

Historically, inflation averages around 2–3% per year. But when it spikes—like we’ve seen recently—those numbers mess with everything from retirement planning to your weekly grocery bill. The 1970s and early 80s? Double-digit inflation. That’s the kind of climate where smart financial moves make a massive difference.

3. The Hidden Tax

Even if you’re not spending more, you’re losing money if your savings are just sitting. That 1% interest on your account? It feels good—until you realize you’re losing 3% in purchasing power. That’s a net negative.

4. Real vs. Nominal Returns

One of my early wake-up calls: realizing that a 2% return during 4% inflation is effectively a -2% return. Nominally, you’re earning. But in reality, you’re falling behind.

5. Doing the Math

Once I calculated how much I was losing to inflation each year, I got serious. If your annual inflation rate is 4%, your $10,000 in cash loses $400 in purchasing power each year. That adds up fast.

How I Inflation-Proofed My Rainy Day Fund

Your emergency fund should help you sleep at night—not lose value while it waits. Here’s how I kept mine liquid, accessible, and working a little harder to fight inflation’s erosion.

1. Liquidity + Value = The Sweet Spot

Your emergency fund has to be ready when life throws a curveball—but not eroding every month. That’s the balance.

2. High-Yield Savings & Money Market Funds

I moved my emergency stash to a high-yield savings account earning 4.5%. It’s still liquid, but at least it’s working for me. Money market funds are another great low-risk option.

3. Find Your Comfort Threshold

Three months of expenses? Six? For me, six felt right—especially in an unstable economy. Peace of mind is worth a little yield loss.

4. Short-Term CDs & T-Bills

To add some punch, I laddered a few short-term CDs and Treasury bills. It was a way to earn more without sacrificing too much accessibility.

My Secret Weapon Against Inflation: TIPS 101

TIPS are like armor for your savings—they rise with inflation, which makes them a valuable tool in times like these. I gave them a try and learned how to use them without overcomplicating my portfolio.

1. What Are TIPS, Anyway?

TIPS adjust with inflation. Their principal goes up with the Consumer Price Index (CPI), which means they’re built to preserve purchasing power.

2. Where to Buy

I bought mine directly through TreasuryDirect.gov. But you can also get exposure through mutual funds or ETFs, which makes it easier if you’re new to this.

3. The Yield Catch

TIPS can have lower yields compared to regular bonds—but the inflation adjustment is the real value. And during high inflation? That protection pays off.

4. Watch the Taxes

Heads up: the CPI adjustment counts as taxable income even if you don’t cash it out. That’s why I keep TIPS in my IRA to sidestep tax hits.

5. Should You Use TIPS?

For me, they’re not a one-size-fits-all solution—but they’re a smart tool when inflation’s high and you want safety with some upside.

Bricks, Mortar, and Beating Inflation

Real estate has long been a reliable shield against inflation. Whether it’s owning, renting, or investing in REITs, this section walks through the options I explored to keep my assets growing—even when prices did too.

1. Why It Works

Real estate tends to rise with inflation. Rents go up. Property values increase. It’s a tangible asset that moves with the times.REITs

2. REITs for Simpler Access

I wasn’t ready to buy another property, so I started with REITs. They’re essentially stocks of real estate portfolios—meaning no tenants, no toilets, just exposure.

3. Owning vs. Renting

Buying a home during inflation can be smart if you lock in a low fixed rate. That’s what I did in 2021, and I’m breathing easier now. Renters? Not so lucky when prices spike.

4. Looking Abroad

International real estate is a wildcard, but if you want currency diversification, it can be worth exploring—just do your homework on local laws.

What I’m Buying (and Avoiding) When Prices Climb

Stocks aren’t immune to inflation—but some sectors thrive while others wobble. I made some shifts in my portfolio that helped it stay solid through the storm. Here’s what worked (and what didn’t):

1. Companies That Weather the Storm

Utilities, commodities, and essential goods—these sectors tend to hold up when prices rise. I shifted some investments toward those in 2022 and saw better resilience.

2. Dividend Growers Are Gold

Stocks that consistently raise dividends can help your portfolio income keep pace with inflation. My portfolio leans heavily on dividend aristocrats now.

3. Value vs. Growth

Growth stocks took a hit during recent rate hikes. Value stocks (especially those with strong cash flow) tend to outperform in inflationary cycles.

4. Go Global

Adding international exposure helped balance out some of the U.S. market volatility. Emerging markets can also benefit from rising commodity prices.

5. Timing the Sectors

Sector rotation isn’t about guessing—it’s about observing trends. I moved into energy and industrials when inflation indicators picked up. It worked.

“Rising prices are no match for a resilient portfolio—focus on sectors that grow with you and turn challenges into opportunities.”

Hack Attack!

• Inflation Isn’t Just Annoying—It’s Expensive: That 3–4% annual inflation rate silently eats away at your savings. Run the math—it adds up fast.
• Upgrade Your Emergency Fund: Ditch the low-interest savings account for a high-yield option or short-term Treasury bills to slow the leak.
• TIPS = Peace of Mind: Treasury Inflation-Protected Securities adjust with inflation. Great for preserving value in rocky times.
• Real Estate Isn’t Just for Landlords: Consider REITs if you’re not ready to buy property. It’s real estate without the real work.
• Dividend Growers Beat the Heat: Focus on stocks that increase payouts faster than inflation. Your future self will thank you.
• Balance and Rebalance: Mix sectors, go global, and watch the data. A nimble portfolio is a resilient one.
• One Small Shift at a Time: Don’t overhaul overnight. Even tiny changes (like switching savings accounts) can pack a punch.

Money That Works as Hard as You Do!

I didn’t overhaul my finances overnight. I made one smart move, then another, then another. And if inflation’s been gnawing at your budget too, you don’t need a complete reset either—just a strategy that works for you. Start with one step. Maybe that’s moving your savings. Maybe it’s exploring TIPS. Whatever it is, make it yours. Because staying still? That’s the only move that guarantees you’ll fall behind.