The government uses an index of prices to determine whether inflation is occurring, and if so how much. As can be imagined, there is a great deal of debate as to what commodities and goods are represented on that index, even in good times. Right now however, with gas and food prices spiraling upwards without any end in sight, the government’s insistence that there is no inflation occurring and that prices are overall holding steady are beginning to sound fairly thin.
We’ve mentioned before that inflation can destroy your retirement more effectively than almost any other factor. Whether you believe that it is happening or not, it is vital to plan ahead assuming that the inflation rate continues to grow.
