Effect of Inflation on Purchasing Power

Maintaining Purchasing Power is arguably the key goal of retirement planning.

What $1 bought 30 years ago in 1983 costs $2.35 today[i].

Over the last 30 years, inflation averaged 2.89%, stripping the Purchasing Power of $1 to $.43[ii].

The S&P 500 annualized Rate of Return with full dividend reinvestment over the last 30 years is 10.87%[iii].

  1. (Source: www.bls.gov/data/inflation)
  2. (Source: US Bureau of Labor Statistics
  3. (Source: www.yahoofinance.com and www.moneychimp.com/features/market)