EVERYBODY HAS A FEW

numbers they sneak peeks at: your favorite ballplayer's batting average, the price of your company's stock, the phone number that cute bartender wrote on a cocktail napkin a few months back. Well, here's another stat to track: the inflation rate for "hospital and related services," which is a component of the national consumer price index the Bureau of Labor Statistics calculates every month. In February the BLS announced that overall prices climbed faster than economists had expected in January, led by the sharpest spike in medical costs in 15 years. In 2006 the cost of hospital and related services, which includes inpatient, outpatient, nursing-home and senior day care, climbed 6.3%, three times the national inflation rate.

Do those numbers indicate that inflation will rise in the coming months? Nobody knows for sure. But here are three things we do know: Inflation won't stay low forever. When inflation does rise, it will sock retirees especially hard. And the best time to buy insurance against any hazard is before everyone else is worried about the problem.

On Feb. 26, when Alan Greenspan practically launched an international selloff of equities by telling a Hong Kong audience the U.S. might plunge into recession later this year, that wasn't actually the most interesting thing he said. Greenspan also explained why overall inflation has been so low for so long across so much of the planet: Countries from Estonia to Ukraine to China have converted to capitalism while trade barriers have been falling. As a result, tens of millions of skilled but relatively cheap workers entered a globalized economy, reducing corporations' labor costs and tamping down wages in developed nations. From the height of guns and butter in 1968 through the end of the Cold War in 1991, prices rose at an annualized rate of 6.1% in the U.S. But the inflation rate has been just 2.6% a year since 1992.

Eventually, though, price increases will lead to pressures for wage increases and further price increases, even in an internationalized economy. You can start arguments among economists by asking them to guess when that will happen and where prices will spike first in America; Greenspan's guesses are in two or three years and low-quality debt.

When inflation does pick up, it will affect retirees and near-retirees particularly severely. Every household experiences its own rate of inflation, depending on which goods and services it buys. And seniors consume a lot of health care, where prices are already rising rapidly and are likely to keep climbing: Americans age 75 and over direct about 16% of their total spending to health insurance, drugs and medical services and supplies, compared with a national average of about 6%. In contrast, young 'uns tend to put dollars into Internet services, PCs and phones, where prices are plunging.

Since 1987 the federal government has calculated an experimental price index to try to capture price changes for the typical basket of goods and services purchased by Americans who are 62 and older. The results are consistent: The CPI for seniors has been higher than or equal to the overall CPI every year, with the difference ranging up to 0.63 percentage points per year. Your personal inflation rate may vary from the national average by much more than that. The bottom line is that if you spend heavily on health care (or education another category in which prices are surging) and not so much on technology, you have special reason to worry about rising prices.

Inflation hits seniors in their assets, too. When prices rise, the value of a dollar drops, which means that if you're holding investments valued in dollars, you lose wealth. Conversely, it means you'll gain if you're holding debt to be paid off in fixed amounts. Seniors tend to have relatively large chunks of their portfolios invested in cash and bonds, while younger people are usually paying off fixed-rate mortgages. "Even moderate inflation leads to substantial wealth redistribution...inflation benefits the young and hurts the elderly," wrote economists Matthias Doepke of UCLA and Martin Schneider of NYU in a research paper published last December. Doepke and Schneider found that, for example, if inflation were to rise 10 percentage points over a 10-year period, seniors would be forced to reduce their spending by 14%.

Inflation, in short, is a major threat to your retirement planning even during times when the overall national rate looks good. A personal inflation rate of just 4% a year will corrode the purchasing power of a fixed income by 24% within seven years and by half within 18 years. That's the difference between a $120,000-a-year lifestyle at age 60 and a $59,235-a-year lifestyle at age 78. And that ain't pretty.

What to do? First, make price increases a part of your planning. Financial advisers increasingly are recommending a dynamic process for mapping out the first 10 years of your retirement, by which you list your income and expenses in as much detail as possible, rather than regularly drawing down your portfolio by a set amount or percentage. That's a great idea but don't forget to hike your costs every year by your estimate of your personal inflation rate.

Second, protect yourself against the skyrocketing costs of long-term-care insurance by purchasing an inflation-protection option with your policy. If you're just on the cusp of retiring, you should seek a policy that offers an inflation rider that has a compounding option. It works the same as the compounding in your portfolio each year your benefit limit will increase by, say, 5%. Each year your limit rises by a greater dollar amount, since the 5% is based on an ever-increasing figure. If you're 70 or older, though, you can opt for the simpler (and cheaper) option instead, where your benefit ceiling rises annually by a fixed dollar amount. Simple options offer nearly the same benefit within the first dozen or so years of buying a policy.

Third, add investments to your portfolio that enjoy seeing prices rise and the value of paper money fall. Gold is the traditional hedge against inflation, but its cost has skyrocketed in recent years. It's a better idea now to make sure a slice of your portfolio is invested in REITs real estate is the very definition of a tangible asset and that your stocks and equity mutual funds include some companies that develop natural resources, such as metals, oil and gas, and timber.

Finally, go easy on securities with built-in protections against inflation. There are TIPS (Treasury Inflation-Protected Securities) and I Bonds, inflation-protected InterNotes (corporate bonds) and IFCDs (Inflation-Linked Certificates of Deposit), all offering variations on the same theme: total return linked to the national inflation rate. None of these are bad ideas, exactly. But since you're probably building your portfolio as aggressively as you can (within the limits of your tolerance for risk) to achieve your retirement goals, you most likely don't want to divert too much of your total portfolio to Treasurys, even to acquire inflation protection. Especially once you factor in another downside to TIPS and their ilk: Inflation has to hit a certain level in order for investors to see any benefit. If inflation rises, say, just 1%, your TIPS will lag regular Treasurys.

You can, however, use TIPS in the low end (yield-wise) of your existing fixed-income allocation. Planners say that if a quarter or a third of your cash equivalents or low-yielding bonds are protected against inflation, you can limit your risk while boosting your returns over time. In the end, though, the best ways to stay ahead of inflation aren't to chase yield or seek guarantees, but the same ways to stay financially healthy overall: to plan ahead and diversify the allocation of your assets.