Financial advisors seek inflation-resistant assets as April inflation hits a three-year high, outpacing wage growth.
Financial advisors are reallocating cash holdings to combat inflation, which rose 0.6% in April and reached 3.8% year-over-year, the highest level in three years. Consumer prices have outpaced inflation-adjusted hourly wage growth, which stood at 3.6%, eroding purchasing power for savers.
Traditional savings accounts yielding below inflation rates are now seen as “dead money,” prompting advisors to prioritize assets that preserve value. While safety and liquidity remain key, the focus has shifted toward inflation-resistant options to protect clients’ portfolios.
The shift reflects broader concerns over sustained price pressures and their impact on real returns. Advisors are increasingly weighing alternatives to low-yield cash holdings amid persistent inflationary trends.