As Inflation Increases, Consumers Urged to Use Caution

DENNIS – Inflation is causing increased prices, and local financial advisors are warning the public on what to expect and how to properly prepare.

According to financial advisor John Franzago, issues in the supply chain, which he described as the route which brings a product into the possession of the consumer, are complex and multifaceted.

“Throughout the pandemic we’ve seen numerous different disruptions, from factories closing down at the beginning, to labor shortages, to transportation issues, so it’s not one issue with the supply chain but many issues,” said Franzago.

As demand has increased, as have the means for many, be them through increased time at home or economic means, that has put an increased strain on the supply chain and led to an increase in prices.

In order to protect themselves, Franzago says it is in imperative for individuals to provide themselves with a fiscal buffer to weather fluctuating prices.

“If you’re in the process of doing a bigger expense project, make sure to put together a budget, allow for delays, and that old rule of thumb of allowing for 110% of expenses, maybe you want to allow for 120% just in case any delays or unforeseen expenses come up,” said Franzago.

The rise in inflation also poses a risk to those with significant money in savings, as high inflation can outpace interest rates in savings accounts, leading to a net loss in buying power.

Even for those seeing a rise in wages, an increase in spending ability can fuel the demand that is bringing supply chains to a halt.

Moving into an uncertain holiday season, Franzago advises consumers to be patient, plan ahead and be aware that it may be harder to find the things they want than in years past.

“Be conscious. Be prepared for possible shortages, be prepared for higher prices than you’ve anticipated. Plan for the worst, hope for the best. So you do want to be prepared to possibly be paying more for some things,” he said.

For inflation related tips or for more information, click here.

By, Matthew Tomlinson, NewsCenter

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