Warren Buffett’s 2 Best Investments To Beat Inflation
Written by
Adam Palasciano
Edited by
Ashleigh Ray
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Inflation may have cooled slightly, but concerns about rising prices and a potential recession are heating up. When it comes to beating inflation, few investors have a better track record than Warren Buffett, the legendary “Oracle of Omaha” and CEO of Berkshire Hathaway.
Buffett has an estimated net worth of about $152 billion, so it’s clear that he knows more than a thing or two about how and what to invest in and how to protect your money from inflation. Here are Buffett’s two best investment strategies to protect your money from inflation and help you build lasting financial security.
Invest in Yourself
Inflation can affect the value of currency and have far-reaching effects on your personal finances. However, there’s one investment that can never be affected by inflation: your skillset.
“Whatever abilities you have can’t be taken away from you. They can’t actually be inflated away from you,” he said in the annual Berkshire Hathaway meeting in 2022. “The best investment by far is anything that develops yourself, and… it’s not taxed.”
If you possess or develop a skill that is in high demand, odds are it will remain in demand — no matter the current CPI or the value of a dollar. This remains one of the best investments to beat inflation.
Invest in Real Estate
One other smart investment that Buffett believes in is real estate. Why? Because of its intrinsic value. Unlike stocks or cryptocurrency, real estate is a tangible asset, which makes it less susceptible to market volatility.
“They’re the businesses that you buy once and then you don’t have to keep making capital investments subsequently,” explained Buffett during a Berkshire Hathaway shareholders meeting. “You do not face the problem of continuous reinvestment involving greater and greater dollars because of inflation. That’s one reason real estate, in general, is good during inflation.”
Real estate generally appreciates over time, and during periods of high inflation when the value of money diminishes, the value of real estate typically rises. Though there is no such thing as inflation-proof investments, this comes pretty close.
Caitlyn Moorhead contributed to the reporting for this article.
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