How to keep your money ahead of inflation
Inflation is the rate prices rise, measured in the US by the Consumer Price Index (BLS). Money that earns less than inflation – after tax – loses buying power every year, even if the balance goes up.
The test that matters: real, after-tax yield
Take the yield, subtract the tax on it, then subtract inflation. A savings account that pays a little above inflation can still lose ground once federal and state tax are taken out. That is why the same yield is worth different amounts to different people.
Investments designed for inflation
- TIPS – Treasury securities whose principal is adjusted with CPI (TreasuryDirect).
- I bonds – savings bonds with a rate that includes an inflation part, reset every six months; annual purchase limits apply.
- Short-term Treasuries and money-market funds – their yields tend to move with interest rates.
- REITs and dividend payers – income can grow over time, but prices move and nothing is guaranteed.
Compare them side by side
IncomeGrid lists 40,000+ investment options screened, each with a risk level 1–5. IncomeGrid ranks every item by yield after tax for where you live: federal, state and each investment type (Treasuries, municipal bonds, corporate bonds, funds, REITs and filed offerings are each taxed differently). Comparing after-tax yields with the latest CPI figure shows what actually keeps up.
See what beats inflation after tax →
Sources
More guides
- Turning your 401(k) into income
- Car loan or pay cash: a simple comparison
- CD rates: how they compare with the alternatives
- Annuities and the alternatives for steady income
- Alternatives to a high-yield savings account
- Saving for a house: where to keep the down payment
- Where to invest retirement money for monthly income
- Dividend income compared with other income investments
- Money market funds and accounts explained
- What to do with side hustle income
- Passive income from investments
- Treasury bills, notes and I bonds
- Real estate income without buying property
- Saving for college: 529 plans and the alternatives
- Stocks and income investments
- The stock market and steady income
- Adding income to a Nasdaq-heavy portfolio
- What to invest in: the main options
- How to invest: first steps
- Social Security and the income gap
- Gold versus income investments
- The S&P 500 and income
- Bonds explained
- Income investments in a Roth IRA
- Pay down the mortgage or invest?
- Investment and compound interest calculator
- Dividend ETFs: how they work
- Emergency fund: where to keep it
- Early retirement: turning savings into income
- Asset allocation and risk versus return
- Alternative income investments open to everyone
- Where to invest money
- Compare investment returns side by side
- High-yield income investments
- Investments that pay monthly
- Where to find the highest interest rates
- Best interest rate accounts: savings and beyond
- Municipal bonds and tax-free income
- Tax-equivalent yield, explained simply
- Yield vs interest rate: the difference
- High-yield bonds explained
- Safer investments with higher yields
- Best yield investments, by risk level
- How to build a bond ladder
- Investments that pay interest
- How much interest will my money earn?
- Find income investments
- Example income portfolios
- Yields around the world
- Method and sources