HNW Investors Pay Close Attention to Inflation as They Prepare for Retirement

High-net-worth investors’ perceptions about inflation rather than hard economic data have a greater influence on how they plan for retirement and spend their money today, according to the latest income investing survey by Nuveen Investments.

Seventy-six percent say they trust their personal experience with inflation rather than statistics calculated by the Department of Labor (24%). Sixty-eight percent say they pay close attention to inflation as they prepare for retirement, invest (62%) or spend money (57%).

Seventy-five percent correctly recognize that inflation is currently low, and 71% understand that retirees experience higher inflation rates than the norm. However, 60% incorrectly say that inflation is 5% or more or say they are not sure. Only 32% are near the real number of 2% to 3%.

Seventy-seven percent say the economic situation will make investment planning more complex. Eighty-six percent say they have experience high interest rates in their lifetime. Within this group, 79% of Millennials, those between the ages of 18 and 37, say they have experienced high interest rates in their lifetime.

Asked what they think will happen to bond values when the Federal Reserve Bank increases interest rates, 40% think they will increase, 30% think they will decrease and 30% think they will either remain the same or they don’t know.

Fifty-two percent said they would make an investment change as a result of interest rate hikes.

The Harris Poll conducted the survey of 1,000 high-net-worth investors for Nuveen Investments.