How to protect savings from inflation and devaluation: instruments and their risks
Investing · · 6 min
You can protect savings from inflation and devaluation with foreign currency, deposits, bonds, gold and stocks. No instrument is universally best: each has its own protection and its own risk, so the choice depends on your horizon, the currency of your expenses and your tolerance for drawdowns. Every option except an ordinary deposit carries a risk of losing money.
By Viktor Skrin
What are inflation and devaluation, and how do they differ?
Inflation is a rise in the prices of goods and services: the same sum buys less. Devaluation is a fall in the exchange rate of the national currency against others: the hryvnia gets cheaper against the dollar. These are different processes, and you protect against them in different ways.
- Inflation hits purchasing power inside the country. Savings in hryvnias lose value even if the amount on the account does not change.
- Devaluation hits those whose expenses or goals are tied to a foreign currency: imported goods, travel, study abroad.
A hypothetical example, not the result of a real account: with annual inflation of 10%, UAH 100,000 left without any income buys in a year what UAH 90,909 buys today. The loss of purchasing power is about UAH 9,091. If your money earned more than inflation over the year, there is no loss; if less, there is.
For more on what to choose from, see the article where to invest money.
How much do savings lose: what does the data show?
According to the State Statistics Service of Ukraine, in data published on 9 October 2026, consumer prices in Ukraine in September 2026 were 10.0% higher than in September 2025; in August the annual figure was 8.1% (State Statistics Service, checked 31 October 2026). The official dollar rate set by the NBU also changed over this time:
| Date | NBU official rate, UAH per $1 | Change from the previous row |
|---|---|---|
| 1 January 2024 | 38.002 | — |
| 1 January 2025 | 42.0295 | about +10.6% |
| 2 November 2026 | 45.3526 | about +7.9% |
Source: official exchange rates on the NBU website, checked 31 October 2026; the rate for 2 November 2026 was announced before that day began. These figures describe the past and promise nothing about the future. They show one thing: in under three years the dollar became about 19% more expensive in hryvnias, and annual inflation in September is higher than in August.
How to read these numbers. Official inflation is an average over the consumer basket, while your own depends on how you spend: if more of your budget goes on food and utilities, it can differ from the headline figure. So compare the income from your savings not with one number from the news but with how the prices of what you actually buy have grown. The gap between income and inflation is called the real return: if it is negative, your money grows on paper but shrinks at the shop.
How can you protect money from inflation: what are the options?
There is no universally best instrument: each has its own protection and its own risk. Below is a comparison with no ranking and no forecasts.
| Instrument | What it protects against | What you risk | Liquidity |
|---|---|---|---|
| Cash and non-cash foreign currency | hryvnia devaluation | the currency's own rate changes; inflation of the currency itself; no income | high |
| Hryvnia deposit | partly inflation, if the rate is above it | the rate may turn out below inflation; early closure often cuts the income | depends on the deposit terms |
| Government bonds and bonds | partly inflation and devaluation (depending on the issue) | the issuer may fail to pay; the bond price changes before maturity | medium |
| Gold | devaluation of the national currency | the gold price in dollars fluctuates; a bar costs more to buy than to sell | medium |
| Stocks and index funds | inflation over a long horizon | drawdowns lasting years; income is not guaranteed | high |
| Cryptocurrency | has no stable protective function | sharp price falls, exchange and wallet risk | high, but with risks |
Separate instruments are covered in: Ukrainian government bonds and Treasuries, gold bars, the S&P 500 index, stocks or bonds.
All the options except an ordinary deposit carry a risk of losing money. Check current deposit and bond rates on the websites of banks and issuers: they change, and they should be compared with current inflation.
How do you avoid putting everything into one instrument?
Protecting against inflation and protecting against devaluation are two different tasks, so savings are usually split into parts. There are no universal shares: they depend on your goals, time horizons and spending.
To choose, answer five questions:
- In what currency will your future expenses be? If you will pay in dollars or euros, it is logical to hold part of your money in that currency.
- When will you need the money? Over a horizon of up to a year, swings in stocks and gold are dangerous; over five years or more they smooth out but do not disappear.
- Do you need fast liquidity? A reserve for a few months of expenses is kept in the most accessible instrument, not the most profitable one.
- What will you do if the price falls by 20–30%? If you would sell in a panic, the instrument is not for you.
- Do you understand where the income comes from? If you cannot explain it in two sentences, do not invest.
Which "protections" should you be wary of?
Rising prices make promises of easy protection attractive, and some people exploit that. Warning signs: assurances that you will surely beat inflation, pressure to "act today", being unable to withdraw your money, a vague explanation of the source of income.
A real return cannot be guaranteed: even a deposit protects only within the terms of the specific bank. If you are offered to hand money over to be managed, first check the person who will handle it using the points in the article how to check a fund manager. Leveraged trading is not protection: it multiplies losses, and how that works is described in the article leverage and liquidation.
What is the place of Sufics managed accounts here?
Sufics is managed accounts in precious metals, US stocks and indices, oil, bitcoin and ether, not a way to protect against inflation. Trades are made by the manager, the client sees positions in the account area, and closed trades are published in the feed on the home page. We do not promise returns and do not compare management with a deposit or gold.
Managed accounts do not guarantee results and carry a risk of losing money, so they suit only the part of your money you are ready to lose. This article describes instruments and is not investment advice. For a general map of the options, see the article where to invest money.
Key takeaways
- Inflation lowers the purchasing power of the hryvnia inside the country, devaluation makes foreign currency more expensive: the protection differs.
- According to the State Statistics Service, annual inflation in September 2026 was 10.0% (8.1% in August); the official dollar rate rose from UAH 38.002 (1 January 2024) to UAH 45.3526 (2 November 2026).
- There is no best instrument: choose by the currency of future expenses, time horizon and liquidity, and treat assurances that you will surely beat inflation as a warning sign.
Frequently asked questions
Does cash in dollars protect against inflation?
It protects against hryvnia devaluation, but not against the currency's own inflation, and it earns nothing. Banknotes have to be stored, and buying and selling usually involves a gap between rates. Over a long horizon it is only part of the solution.
Does a hryvnia deposit protect against inflation?
Only if the rate, after all deductions, is above inflation over the same period. If it is lower, the sum on the account grows while its purchasing power falls. Before opening a deposit, compare the rate with current inflation and check the early-closure terms.
Can you protect savings with gold alone?
That is a risky bet on a single asset. The gold price in dollars fluctuates, and when you buy a bar you pay more than you get when you sell. Gold is usually seen as one part of a set of instruments, not as the only protection.
Do you need cryptocurrency to protect against inflation?
It has no stable protective function: its price can fall sharply, and exchange and wallet risks come on top. If you decide to hold cryptocurrency, it should be a sum whose loss you can bear.
Where to start if the amount is small?
With a reserve for a few months of expenses in an accessible instrument, and answers about your horizon, the currency of your expenses and the drawdown you can tolerate. Add riskier instruments only after that, and only with money you will not need in the next few years.
