Wealth Management Newsletter

Unravelling the Rising Cost of Living

Understanding What Drives Higher Prices Can Help Improve Retirement Planning 

According to the Employee Benefit Research Institute’s 2024 Retirement Confidence Survey, 83% of workers are concerned that the higher cost of living will make it harder to save as much as they want toward retirement. If you’re like most retirement savers, you’ve likely had concerns over the rising cost of living over the past few years. And for younger workers, it’s the first time you’ve experienced an elevated inflation rate as an investor. 

The cost of living, which reflects the amount of money required to maintain a certain standard of living, is influenced by several forces. Better understanding these factors and how they fit into your retirement planning process can help you prepare for future financial challenges. It can also motivate you to create an investment strategy that aims to stay ahead of rising prices over the long term. In addition, it can help you forecast a more accurate budget to meet your needs during retirement.

Key Forces Behind the Rising Cost of Living 

1. Inflation. Inflation is the general increase in prices of goods and services over time. It reduces purchasing power, meaning that consumers need more money to buy the same amount of goods and services. Inflation can be driven by excess demand over supply, rising production costs or other factors. 
2. Housing costs. Housing is often the largest component of living expenses. Rising demand for housing, limited supply, and increased costs of construction and land can drive up home prices and rents. Urbanization and population growth further worsen this issue, particularly in major cities. 
3. Wages and labor costs. When wages increase, businesses may pass these costs onto consumers in the form of higher prices. While wage growth can boost living standards, if it outpaces productivity, it can contribute to inflation and higher living costs. 
4. Energy prices. Energy costs, including electricity, gas and fuel, significantly impact the cost of living. Fluctuations in global oil prices, geopolitical tensions and supply constraints can lead to higher energy costs, affecting transportation, heating and manufacturing expenses. 
5. Healthcare costs. Rising healthcare costs, due to advancements in medical technology, increased demand for services and an aging population, contribute significantly to the overall cost of living. Higher insurance premiums and out-of-pocket expenses add to household financial burdens. 
6. Education expenses. The cost of education, including tuition fees, books and related expenses, has been rising steadily. This places a financial strain on families and students, impacting their overall cost of living. 
7. Supply chain disruptions. Events such as natural disasters, pandemics and trade conflicts can disrupt product supply chains, leading to shortages and higher prices for goods. These disruptions affect everything from food to consumer electronics, contributing to a higher cost of living.

Informational Sources: Nationwide: “How Does Inflation Affect Your Cost of Living” (March 26, 2024); Investopedia: “How Inflation Affects Your Cost of Living” (October 26, 2023); SoFi: “The 7 Factors That Cause Inflation” (September 28, 2023). 

 LPL Financial and its advisors are only offering educational services and cannot offer participants investment advice specific to their particular needs. If you are seeking investment advice specific to your needs, such advisory services must be obtained on your own separate from this educational material. 

Kmotion, Inc., 12336 SE Scherrer Street, Happy Valley, OR 97086; www.kmotion.com

©2024 Kmotion, Inc. This newsletter is a publication of Kmotion, Inc., whose role is solely that of publisher. The articles and opinions in this newsletter are those of Kmotion. The articles and opinions are for general information only and are not intended to provide specific advice or recommendations for any individual. Nothing in this publication shall be construed as providing investment counseling or directing employees to participate in any investment program in any way. Please consult your financial advisor or other appropriate professional for further assistance with regard to your individual situation. 

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Market Swings: What Really Matters

Practical Ways To Manage Market Volatility Without Overreacting 

Market ups and downs can feel unsettling — especially when headlines highlight sharp swings from one day to the next. But volatility is a normal part of investing, and understanding how to manage it can help you stay focused on your long-term goals.

Put Volatility in Perspective 
Short-term market movements are often driven by factors like interest rate uncertainty, geopolitical conflicts and rapidly rising prices at the grocery store and gas pump. Do any of these sound familiar? Although these shifts can create uncertainty, they are not unusual. Over time, markets have historically moved through cycles of growth and decline. For long-term investors, these periods are part of the journey — not a signal to abandon your plan. 

Avoid Emotional Decisions 
One of the biggest risks during volatile periods is reacting emotionally — selling when markets drop or trying to “time” a rebound. These moves can lock in losses and make it harder to benefit from future market recoveries. Staying invested and sticking to your strategy is often the more effective approach. 

Focus on What You Can Control 
You can’t control the market, but you can control your behavior. Key actions include: 

• Maintaining a diversified portfolio to help manage risk 
• Continuing your regular contributions, which can allow you to buy investments at lower prices during downturns (and continue receiving your employer match) 
• Reviewing (not overreacting to) your investment mix to ensure it still aligns with your time horizon and risk tolerance. 

Think Long Term 
Retirement investing is a long-term process. Daily or even yearly market movements are less important than the overall trajectory over decades. If you’re years away from retirement, short-term volatility may have less impact than you think — and may even present opportunities for growth. 

When To Revisit Your Plan 
Volatility can be a good reminder to check in on your plan — not to make sudden changes, but to confirm you’re still on track. If your goals, timeline or comfort with risk have changed, it may be worth adjusting your strategy thoughtfully. 

Informational Sources: Investopedia: “Protect Your 401(k): Strategies to Navigate Market Crashes” (March 15, 2026); USA Today: “Worried Market Volatility Will Hurt Savings? Here’s What to Know” (March 30, 2026). 

LPL Financial and its advisors are only offering educational services and cannot offer participants investment advice specific to their particular needs. If you are seeking investment advice specific to your needs, such advisory services must be obtained on your own separate from this educational material. 

©2026 Kmotion, Inc. All rights reserved. This newsletter is a publication of Kmotion, Inc., whose role is solely that of publisher. The articles and opinions in this newsletter are those of Kmotion. The articles and opinions are for general information only and are not intended to provide specific advice or recommendations for any individual. Nothing in this publication shall be construed as providing investment counseling or directing employees to participate in any investment program in any way. Please consult your financial advisor or other appropriate professional for further assistance with regard to your individual situation.