The Consumer Price Index, or CPI, is a means of measuring and tracking changes in consumer prices over time. The U.S. Bureau of Labor Statistics produces its CPI each month, listing data on changes in the prices paid by urban consumers for a couple hundred categories of goods and services, such as food, medicine and transportation.
Financial advisor Stacy Francis, president and CEO of Francis Financial, calls the CPI one of the most important factors in good financial planning, from budgeting day-to-day expenses to planning retirement.
CPI "has a big impact on ... your retirement because it means that when you retire, things are also going to be more expensive," she said.
How should you respond to the inflation, or rise in prices, tracked by CPI?
"You need to get smart about your money and ... your investing," Francis said. "With investing, you can look at different types of 'vehicles' to make sure that your investments are at least growing faster than the CPI."
Read MoreGet ready for a rise in rates
That might mean looking at high-performance stocks or, if bonds make up a good portion of your retirement portfolio, Treasury Inflation Protected Securities, or TIPS.
Speaking of TIPS, CPI and other financial acronyms, Francis said it pays to get educated about industry jargon.
"There's a lot of financial jargon out there ... [and] it takes time to understand [it]," she explained. "Make an investment in learning about the jargon you hear every day, because it's one of the most important things you can do to protect, and make decisions about, your financial future."
