In this video, Ed Butowsky dives into the hidden realities of fixed-income investments, specifically focusing on fixed-income investments. Discover the impact made on your purchasing power when factoring in taxes, inflation, and additional fees. It is important to always consider your real return, rather than just what is stated on paper.
- Fixed-income vehicles typically provide returns that align with the prevailing inflation rate. Although these returns may seem appealing initially, it’s important for investors to consider the real return, accounting for inflation and other hindrances.
- Purchasing power is a straightforward concept that measures the value of your currency at a specific time and place. If you’re not familiar with this term, we recommend exploring more of our content for a deeper understanding.
- If you’re considering investing in a CD or any other fixed-income investment, it would be advantageous to do so when interest rates are relatively higher and about to go down, allowing you to lock in a total return.