History
How were inflation rates before World War I?
Relatively low and stable
What type of inflation occurs when demand exceeds supply?
Demand-pull inflation
What is one strategy to protect savings from inflation?
stocks
What is financial literacy?
Understanding how to manage money, including budgeting, investing, and saving
How does inflation affect purchasing power during retirement?
Reduces purchasing power over time
What happened to inflation during World War II
Inflation increased due to government spending
What is cost-push inflation?
Inflation caused by increased production costs
How can real estate investments help against inflation?
Real estate appreciates over time
What is inflation?
The rate at which the general level of prices for goods and services rises, reducing purchasing power over time
What is one impact of inflation on the cost of living for retirees?
Increased cost of essential items
What caused high inflation in the 1970s?
Global oil crises
What is built-in inflation?
Inflation resulting from rising wages and prices
What role do commodities and precious metals play in protecting savings?
They can hedge against inflation
What is a Registered Retirement Savings Plan (RRSP)?
A retirement savings plan that allows Canadians to save for retirement on a tax-deferred basis
How does inflation affect investment returns?
Decreases real return on investments
What policy did the Bank of Canada introduce in the 1990s?
Inflation-targeting policy
How does monetary policy affect inflation?
Excessive growth in the money supply can lead to inflation
What is an inflation-protected annuity?
An annuity that adjusts payouts based on inflation rates
What is a Tax-Free Savings Account (TFSA)?
A Canadian account that allows tax-free growth of investments and tax-free withdrawals
What is longevity risk in the context of inflation?
Inflation compounds over time, increasing the amount needed for retirement
What recent events have caused inflation to rise in the 2020s?
Supply chain issues, rising energy prices, increased demand post-pandemic
How can exchange rates lead to inflation?
Depreciation of the national currency can increase the cost of imported goods
How can diversifying your portfolio help protect against inflation?
Reduces risk and exposure to inflation
What is a Real Return Bond (RRB)?
A bond issued by the Canadian government that provides inflation protection
How can retirees mitigate the impact of inflation?
By investing in inflation-protected securities and diversifying their portfolio