How much will your wealth be worth tomorrow?
An annual rise of 5.5% in the Coutts Luxury Price Index (CLPI) highlights the ‘hidden’ inflation that can erode your wealth.
6 min read
If you enjoy the finer things in life, the prices you pay are rising faster than mainstream inflation implies.
Our research shows that prices for luxury goods and services are rising much faster than the latest inflation rate released by the Office for National Statistics (ONS). The Coutts Luxury Price Index (CLPI) shows that luxury items are increasing at a rate of 5.5% compared to the latest Consumer Prices Index (CPI) data released by the ONS on 23 May 2018 of 2.4%.
Anyone buying luxury goods and services will see the spending power of their wealth decline much more quickly than headline inflation suggests unless they take action to secure a higher return on their savings.
How ‘hidden inflation’ affects you
Your exposure to this ‘hidden’ inflation will be higher or lower, depending on your spending habits. We estimate that a consumer who spends 50% of their money on luxury goods will be exposed to inflation of 3.9% at current rates.
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To find out more about how to keep pace with inflation and establish a wealth strategy that works for you, contact your private banker or explore coutts.com
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Past performance should not be taken as a guide to future performance.
Our research shows that prices for luxury goods and services are rising at 5.5% a year, more than double the mainstream rate of inflation. If you enjoy life’s luxuries then you need to be even more aware of corrosive effect of inflation on the spending power of your wealth.
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