We could be forgiven for focusing on life’s trials and tribulations heading into 2022, given the challenges that we’ve faced over the last couple of years. Despite inflation-related concerns, new COVID variants and supply chain disruption, which may be disconcerting for investors, there are indications that the coming year will present opportunities as well as risk, as we hopefully venture towards post-pandemic life.
International soothsayer, the International Monetary Fund (IMF) predicts a continuation of the global recovery in 2022, forecasting growth of 4.9% for the world economy. Its analysis did, however, acknowledge that the level of uncertainty encircling prospects has intensified with policy choices becoming increasingly complex.
Taking steps to inflation-proof your wealth
Rising inflation and global supply chain issues have undoubtedly generated a policy dilemma for central banks. These dual concerns have heightened the need for investors to employ considered strategic thinking, enabling them to reposition their portfolios in order to take advantage of growth opportunities, while ensuring their wealth is inflation-proofed.
As the year progresses, although the spectre of rising inflation is expected to see central banks tighten policy, deposit-based savings rates are forecast to remain at historically low levels. Such small returns have prompted many savers to move their money into investments, with research suggesting over half of all adults have done so. This shift has raised concerns that unrealistically high return expectations could leave some investors vulnerable to investment scams.
Although 2022 is likely to present ongoing challenges, the key to successful investing remains adopting a carefully considered strategy based on sound financial planning principles. Attractive investment opportunities will undoubtedly be available as the year progresses. With our help and careful repositioning of your portfolio, you should be able to make the most of these as and when they arise.
The value of investments and income from them may go down. You may not get back the original amount invested.