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Author: 2old4bs Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 76079  
Subject: Re: Inflation Rate Poll Results Date: 2/10/2005 3:09 PM
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If I had to make a wild guess, I would probably guess that the younger among us are probably using the lower rates, whereas the more seasoned among us are likely using the higher ones.

I tend to agree with the statement above, but my analysis as to why is different. I think the older folks have experienced double-digit inflation, while the younger ones haven't. There's a tendency in the young to think bad things can't happen to them (I think psychologists call it "the invulnerability" something--how's that for a senior moment?). As we age most of us become more realistic, as we ourselves, or our close friends and relatives, experience many of these negative things that we used to think could never happen.

I actually use a dual stage inflation projection in my analysis. I have one stage that projects "inflation in my working years", and another that projects "inflation in my retired years."

That's a great idea, and I understand your rationale completely. (I must admit it would be too much work to incorporate it into my spreadsheet though ;-)

Thanks for the response,

2old


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