As you may have learned over the years, inflation risk can decrease your buying power, especially in retirement. Inflation is one of the biggest challenges facing retirees, even more for those on fixed incomes. For this reason, inflation protected income can give retirees an edge so that their income increases as costs rise.
CPI-Linked Income Some investments will pay you income that rises with the Consumer Price Index. The CPI is determined by the bureau of labor statistics based on the observed price of a basket of staple goods. This way as your cost of living increases, so does your income.
Commodity Price Related As prices of commodities like oil rise, your dollars will tend to be worth less at the store and at the pump. Assets whose prices and income yields are tied to the same commodity prices will help to offset these cost increases as they occur.