3 Ways to Protect Yourself Against Inflation

Right now Inflation is probably the last thing on peoples minds. As an investor you are probably more worried about your stock portfolio, your home value, or your job. Having said this, with all the money the United States Government as well as other governments around the world have been pumping into the Economy, there is sure to be heavy inflation in the next year or two. Some economists even venture to say that inflation could rival the double digit numbers we have seen in the 1970's. I don't think it will get that bad, but I do think you should consider protecting your self against inflation. Here are 3 quick investment methods to do so:

1. Buy Gold - Gold is probably one of the best hedges agianst inflation. As the value of the dollar falls with inflation, the amount of gold that the dolalr can buy decreases, making it more valuable.
   
2. Exchange Traded funds (ETFs) - which are inverse treasuries or inflation. Ticker (TIP) is a fund which invests in instruments that are the inverse of inflation. If inflation rises you will get a return that inflation won't effect. (RYJUX) is another fund which is the inverse of treasuries, standing for "Rydex Inverse Gov Long Bond Strategy". As inflation rises, government bond values fall. This invests in Vehicles which are inverse of that.
3. Buy a Home - We may not see run ups in prices liek we have in the past, but a house is a great inflation protected asset.

It's probably not a good idea to go all out and throw all your money into the above 3 investments, but a good 10-20% more into a combination of these three investments coudl pay off big if you beleive inflation will be a major problem in the future.