Amid rising inflation, investing in the stock market has become increasingly crucial.

Consumer budgets are being squeezed more than ever in the last 40 years due to rising prices.

For many investors, it may be crucial to keep their long-term savings in the stock market.

Historically, investing in equities has been a sound strategy for beating inflation. For instance, the average annual return of the S&P 500 is approximately 10%, which is higher than the 7.9% annual inflation rate recorded in February.

According to Eric Henderson, president of the annuity business segment at Nationwide Financial, historically, investing in equities has been the best way to beat inflation, despite their volatility, as they have proven to be a successful strategy in the long run.

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Balance higher prices and savings

Amidst the current economic climate, with inflation and interest rates on the rise, saving for the future may become more challenging for Americans.

Some investors may have been unnerved by the recent volatility in equities, which was caused by the Fed hiking rates and the war in Ukraine.

It is advised to continue investing consistently, particularly for those with longer time horizons, according to experts.

Ed Slott, CPA and founder of Ed Slott and Company, stated that consistently contributing to retirement savings will always result in more funds. He also suggested utilizing dollar-cost averaging as a method to manage market volatility.

Slott stated that it levels out the impact of volatility by smoothing out contributions over time.

If you can, avoid reducing retirement savings while other prices are increasing.

Consider the long-term perspective instead of the short-term one," advised Henderson. "Avoid reacting impulsively to immediate pressures.

Time to rebalance and diversify

While investing in volatile markets carries risk, there are strategies that investors can employ to safeguard and enhance their portfolios during market fluctuations.

When the Fed is aggressively tightening monetary policy in a high inflation environment, investing in equities becomes a riskier proposition, according to Liz Ann Sonders, managing director and chief investment strategist at Charles Schwab.

She emphasized that while it's not necessary to stay away, it's crucial to be aware of the crucial disciplines to help navigate through a more volatile period.

To achieve a well-diversified portfolio, it's important to have investments spread across various sectors of assets, such as stocks, bonds, and more.

In equities, you may want to shift towards sectors that typically perform better during high inflation, such as energy, industrials, and real estate stocks. Commodities and gold have also historically performed well in such environments, according to Sonders.

Find the right risk profile for you

During a market downturn, investors should assess if their financial and emotional risk tolerance align.

Finding the right balance is important to keep investing in the long term.

To grow your money over time and build a nest egg, you need to invest in areas beyond a savings account, as she stated.

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Disclosure: NBCUniversal and Comcast Ventures are investors in Acorns.