Comments on: Rampant Inflation: My Big Early Retirement Worry

By: Kimberly

Kimberly — Thu, 03 Feb 2011 04:11:22 +0000

Great read. I agree that US health insurance needs to be reformed. I do not favor a Canadian system, though. I think it would lower the standard of care.

By: julie

julie — Sun, 03 May 2009 19:00:49 +0000

I’m sure MIssouri is a lovely place..

By: Elizabeth

Elizabeth — Mon, 27 Apr 2009 14:56:27 +0000

Kevin, we do not discriminate based on nationality on this blog.

By: Kevin

Kevin — Mon, 27 Apr 2009 13:36:32 +0000

Actually, I’m from Missouri. Sorry to disappoint.

I do love hockey though!

By: Elizabeth

Elizabeth — Sun, 26 Apr 2009 20:40:37 +0000

Julie, I have looked into both the medical tourism option (going to a hospital in say Thailand) as well as the possibility of living in another country. Obviously, not just due to healthcare cost issues, but due to a whole lot of things. As of now, although the prospect of living somewhere else has appeal, I haven’t found something so compelling to make me move

By: julie

julie — Sun, 26 Apr 2009 19:55:52 +0000

Good point, Elizabeth. I wasn’t mindful of the health care aspect for Americans. It is not entirely a no-concern for Canadians (those without extended health benefits here have to pay out of pocket for dental, many prescriptions, medical devices, and services like physiotherapy, massage, etc.) but we don’t have to think about primary health care. It is a big difference If the Obama administration doesn’t come up with some reforms, perhaps you might consider immigrating north We’d love to have you!
(Now I’m curious as to where in Canada Kevin is!

By: Elizabeth

Elizabeth — Sun, 26 Apr 2009 19:07:20 +0000

Hi Julie, Hi Kevin, yes, you are both correct that there should be investments that go up in price. The challenge, as shown in the downturn of the markets last year, is sometimes the assets that are supposed to protect you and diversify, don’t.

Also, I believe both of you are Canadian, meaning that healthcare costs and health insurance costs have a structurally different component than those of us living to the south of you. In the US, the challenge is not just the rising cost of insurance premiums (as I’d mentioned about 25% per year, each year) and rising costs as you get older, but that premiums and coverage are being denied left and right, leaving the possibility of a financial black hole if you suddenly have medical expenses.

For now, the healthcare side of the equation is still manageable for me, but I believe this remains the #1 scare preventing many Americans from exercising early retirement or greater job flexibility.

By: Kevin

Kevin — Sun, 26 Apr 2009 18:03:51 +0000

Don’t forget with inflation, if something goes up in price, there are usually alternatives to purchase. Like Julie said, if you’re not in the consumerist culture, it won’t affect your budget nearly as much as someone trying to keep up with the Jones’.

By: julie

julie — Sun, 26 Apr 2009 17:32:36 +0000

I’m in Canada, and have started to look at the equivalent of Treasury Inflation Protection Securities (TIPS) to form part of the basis of my plan to leave highly paid employment really early. But I gather that in the US TIPS are available only to individuals in retirement plans, and only in the form of mutual funds. We can buy real-return bonds directly in Canada, though they don’t have the same tax preferential treatment.

There is a good (though perhaps not entirely realistic) discussion of inflation in “Your Money or Your Life.” When you live behind the curve, inflation doesn’t affect you as it would if you were a ‘typical’ consumer purchasing a new basket of goods regularly. I’ve found that recent inflation has affected me a lot less than those around me, mostly because I don’t shop as much.

By: Elizabeth

Elizabeth — Sun, 26 Apr 2009 14:58:57 +0000

Hi Pipps, I sometimes read Tim Ferris’s blog and had read the post on Jason Bourne before you pointed to it. As both an American citizen that has lived outside the US, and a person whose spent a lot of time analyzing foreign investments (both professionally and for myself), I must say I am not nearly as enamored of being invisible as some of the commenters on that post. Yes, there can be hassles to be part of the formal system (like we American citizens are taxed on global income), but it does offer protection when things go wrong, really wrong. And yes, I have witnessed this in person.

In addition, I was wary of the situation in Icelandic banks (and CA/Arizona/Las Vegas real estate) for some time (this made me quite unpopular in dinner party conversation). I think the recent action by a Swiss-based bank will also take some time to work its way through everyone’s thinking, but suffice it to say I think the regulatory environment for international banking is evolving rapidly. Or your mileage may vary, as they say.

If I had to pick 3 countries to have investment exposure to (that I do through ETFs), it would be China, Australia (for the commodities sold to China), and probably Brazil.

Thanks for reading and commenting.