Can understanding inflation better help you to take better care of your investment returns? Inflation can have a significant impact upon finances; American economist Milton Friedman says, ‘Inflation is taxation without legislation.’ Inflation affects all areas of the economy, it applies pressure by rising commodity prices for example. Inflation can lessen the power of your purchase, it therefore impacts upon the cost of living all of which can reduce returns on your investments. Seeking professional financial advice could help you to make more sense of the impact of inflation upon your investments.
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the value of some investment units can fall as well as rise.