3 proactive ways to protect your wealth from inflation

14 May 2026

In early March, Rachel Reeves gave the government’s Spring Statement. At that time, the Office for Budget Responsibility (OBR) had forecast that inflation would continue to fall to the Bank of England’s (BoE) 2% target rate, thanks in the main to lower energy and food prices.

However, the OBR’s forecast didn’t account for the Middle East conflict, which commenced the weekend prior to Rachel Reeves’ long-scheduled speech.

With the conflict all but halting shipments of oil and liquefied natural gas through⁠ the Strait of Hormuz, which typically carries about one-fifth of the world’s gas and crude supply, we’re experiencing one of the world’s biggest oil supply disruptions in history.

Disrupted energy supplies and rising oil prices (a barrel of Brent oil rose above $126 on 29 April, its highest level since 2022) are expected to impact food prices. Indeed, the Food and Drink Federation has forecast that the food inflation rate could reach more than 9% by the end of 2026.

As the conflict continues, the price of many more goods and services could be affected.

UK consumers should brace themselves for inflationary pressures over the coming months

Inflation has regularly featured in headline news since the Covid pandemic. Most notably in October 2022, when UK inflation hit 11.1% – its highest rate for 40 years.

It took the Bank of England almost two years to bring it down to the target rate of 2%, which we saw briefly in summer 2024. Now, latest figures from the Office for National Statistics (ONS) show the UK inflation rate in the year to April 2026 is 2.8%.

While this is a welcome dip, the rate remains above the BoE target and could rise again in future.

Your personal inflation rate is unlikely to match the official figure

Inflation is measured by assessing the average price of hundreds of everyday items.

The ONS tracks the price of a selection of goods that’s updated each year to reflect shopping trends. For example, in February 2026, the ONS added 27 new items to the inflation shopping basket, including houmous, dog grooming, and dashboard cameras. Meanwhile, sheets of wrapping paper were replaced by rolls of wrapping paper to better reflect the convenience and availability.

So, while the national inflation rate is currently hovering around 3%, your personal inflation rate will depend on how you spend your money.

The ONS inflation calculator can help you to work out your personal inflation rate.

You may feel more comfortable with some human input – if so, please get in touch and we’ll help you to understand how your spending may be affected by inflation. We can also advise you on steps you could take to protect your wealth from inflationary pressures.

3 tips to protect your wealth from inflation

Though there’s nothing you can do to stop inflation, there are steps you could take to lessen the effect it has on your wealth. Here are three proactive steps that could help you “beat” inflation.

1. Review your budget

While your personal inflation rate may differ from the national rate, as your everyday spending rises, your long-term financial freedom may suffer.

So, take some time to understand how your expenses have changed over the last 12 months. Reviewing your budget will help to highlight where spending has increased and potentially show opportunities to save.

You may find that you need to adjust your day-to-day spending to meet long-term goals, or you may be in a better position than you thought.

2. Shop around for a better interest rate on your cash savings

Over time, the effects of inflation can reduce the buying power of your money. If you hold too much cash for too long, this could become problematic. In the worst-case scenario, holding a large cash sum for many years could undermine your long-term financial security.

According to analysis from Fidelity, UK households hold around £1.88 trillion in cash deposits:

• 70% of UK householders’ savings are held in easy access accounts
• 30% in fixed-rate savings.

The report also revealed that in 2025, savers earned roughly £45.6 billion in interest – which equates to an average return of 2.43%.

However, once you factor inflation in (the Fidelity team considered the impact of inflation at 3.4%) the real value of their savings fell by around £17.6 billion over the course of the year.

So, if you haven’t assessed what you’re earning on your cash savings for a while, now’s a good time to do so.

At the time of writing (30 April 2026), Tembo Money is offering 4.75% on savings in its HomeSaver account, which allows immediate access to your money. To find out more about this account and more, visit Moneyfacts, which compares all the available offers, terms, and conditions.

At the time of writing (30 April 2026), Tembo Money is offering 4.75% on savings in its HomeSaver account, which allows immediate access to your money. To find out more about this account and more, visit

If you don’t expect to need to access your savings, you may benefit from a more competitive rate through an account that locks the money away for a fixed period.

Remember to keep at least three to six months of household expenditure in an easy access cash account to cover unexpected costs.

3. Consider investing excess cash savings for greater potential growth

While it’s sensible to keep an accessible cash cushion on hand in the event of an emergency, investing in assets that are likely to produce higher returns than interest rates could help you beat inflation.

If you’re saving for long-term goals, and don’t expect to need to access your money for five years or more, investing could be a suitable option.

Returning to the Fidelity report, analysts looked at how global equity markets performed in 2025. Over the year, the MSCI World Index delivered a total return of around 13% in British pounds.

If just a quarter of UK household cash savings (£470 billion) had been invested, analysts estimated that the real value of savers’ money could have grown by approximately £44 billion – and that’s after accounting for inflation.

Indeed, research has regularly demonstrated that, over long periods, investments are more likely to beat inflation than cash.

When looking at each 10-year rolling period between 1988 and 2025, Fidelity researchers found that had you invested in UK stocks, you’d have beaten inflation 95% of the time. Meanwhile, had you been saving in cash, you’d have beaten inflation only 58% of the time.

Although markets can experience short-term fluctuations, historically, investment markets have delivered returns that have outpaced inflation over the long term.

Remember, the value of your investments (and any income from them) can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance.

We’re here to help you understand if investing is a good option for you. We’ll help you to answer key questions about your long-term goals and ensure your investment strategy is aligned with your goals and matches your risk profile.

Get in touch

If you’re concerned about the effects of inflation on your finances, or any other aspect of your long-term financial plan, we’re here to help. Please email [email protected] or call 0161 8080200.

Please note

This article is for general information only and does not constitute advice. The information is aimed at individuals only.

All information is correct at the time of writing and is subject to change in the future.