Inflation is the rate at which the prices for goods and services increase. Inflation often affects the buying capacity of consumers.

Steps to offset Inflation and its effects on Your Retirement:

1.Invest in long-term investments.

When it comes to long-term investments, spending money now for investments can allow you to benefit from inflation in the future.

2.Save More

Retirement requires more money than one might imagine. The two ways to meet retirement goals are to save more or invest aggressively.

3.Make balanced investments

Though investing in bonds alone feel safer, invest in multiple portfolios. Do not put all your eggs in one basket to outpace inflation.

Pros:

1.Leads to higher resale value of assets

2.Optimum levels of inflation encourages spending

Cons:

1.Buyers have to pay more for products and services

2.Impose higher prices on economy

3.Drives some prices up first and others later