How to Protect Your 401(k) From Inflation
- Author: Jeff Christiansen
- Posted: 2026-01-29
Inflation can slowly reduce the buying power of your retirement savings.
If prices rise faster than your 401(k) grows, your money may not go as far in retirement.
Taking a few smart steps can help protect your account.
Why Inflation Matters for Your 401(k)
When inflation is high, some investments—especially long-term bonds—may lose value. Other assets, however, tend to perform better and can help offset rising costs.
Read: 19 States Just Raised Minimum Wage in 2026 – Are You Getting Paid More?
Diversify Your Investments
Diversification is one of the best defenses against inflation.
Spreading your 401(k) across different asset types helps reduce risk and improves long-term growth potential.
Focus on Inflation-Resistant Assets
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Stocks (Equities): Companies can raise prices over time, which often allows stocks to outpace inflation in the long run.
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Inflation-Protected Bonds: Options like Treasury Inflation-Protected Securities (TIPS) adjust with inflation and help preserve purchasing power.
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Real Estate (REITs): Real estate values and rents often rise with inflation, providing income and growth.
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Commodities: Assets like gold or energy funds can help hedge against rising prices.
Review Your Plan Regularly
Check your contributions and investment mix at least once a year.
Adjusting allocations as markets and inflation change can help keep your retirement savings on track.
Bottom Line
Inflation doesn’t have to derail your retirement. A well-diversified 401(k) with inflation-resistant investments can help protect your savings and maintain your future buying power.
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