Almost two-fifths of investors are worried about inflation and especially the young, according to two new bits of research.
Some 42% of younger investors are concerned that a sustained burst of inflation will have a negative impact on their investments, compared to 38% of investors aged 55 plus, a survey carried out by fund manager Janus Henderson found.
Some 30% have already changed how they invest to reflect rising prices and a cost of living squeeze, but nearly half didn’t seem to care and said it would not have any impact.
Notably, Janus said collectibles and NFT investors were the most optimistic with around 45% expecting it to help their investments.
James de Sausmarez, Director and Head of Investment Trusts, at Janus Henderson added:
“UK investors are all facing the challenges of an inflationary environment and, regardless of age or experience, the ability to live comfortably in retirement is a clear priority.
“The research shows that those nearing retirement age are more concerned about the risks inflation pose, perhaps because they recognise that their planned income streams will need to grow at least in line with inflation if the real value of their retirement income is to be maintained.
“Conversely, younger investors, who have more flexibility and can take a longer-term view.”
A survey by wealth platform Hargreaves Lansdown, meanwhile, reported two-thirds of its clients were concerned with a quarter thinking about a change of strategy.
Building more savings is the route most are contemplating, but some (6% of respondents) are looking at a cut in regular savings or pension contributions with only 10% looking at selling existing investments.
Sarah Coles at HL said: “Inflation is more likely to make investors put more money away for the future than it is to get them to sell up or cut contributions: one in seven say they’ll boost savings.
“This is a very sensible option. When you’re working age, you need 3-6 months’ worth of essential spending in an emergency savings account, and in retirement, you should have 1-3 years’ worth.
“When the cost of your essential spending rises, your emergency fund will need to rise with it.”