Forget Retirement... and Retirement Savings
The Dollar Vigilante
by Jeff Berwick: The
sold a bill of goods for the last four to six decades. You've been
told that nation-states, democracy and socialism is good. You've
been told our monetary system prevents instability. And, while the
government and central banks put your unborn children or grandchildren
into debt for life they've been telling you that there will be a
socialist safety net to protect you and that the "American dream"
includes retiring in your 50s or 60s to a wonderful life of golf
and lying on the beach.
It even appeared
to work for a short while thanks to demographics and the greatest
advances in human history.
The baby boom
caused by the nation-state (which created World War II) and central
banking (which created the depression and funded World War II) was
truly a boom creating a once-in-a-lifetime chance to make it appear
as though some of these inane socialist theories could work.
A look at the
number of workers per retiree in the US shows this plainly.
And, with the
advent of the internet, productivity also increased massively in
the 1990s and 2000s, further obscuring the collapse to come. And
it is coming. In fact, it's already started. So, if you are basing
your future retirement plans on what has happened in your living
memory you better snap out of it.
SECURITY THE ULTIMATE PONZI SCHEME
A ponzie scheme
is defined as "a fraudulent investment operation that pays returns
to its investors from their own money or the money paid by subsequent
investors, rather than from profit earned by the individual or organization
running the operation". By this definition, the Socialist Security
system in the US is a ponzi scheme.
The end of
a ponzi scheme is always when net payments outstrip net income.
This occurred in 2010 and there is no end in sight even under the
US Government's own heavily massaged and always underguesstimated
There is only
one reason it and the US Government hasn't gone bankrupt yet. It's
because they can still print dollars to cover all these deficits.
But how much longer can that realistically last before hyperinflation
sets in and the dollar becomes worthless? We can't see any way it
goes more than five more years from here... and that's pushing it.
YOU DON'T HAVE TO PAY, DON'T
you are forced at gunpoint to pay into the Socialist Security system
so long as you are a worker (entrepreneurs can avoid payments) or
live/work in your home country in the western world. So, as long
as you live and work in the west this is unavoidable.
tax-sheltered retirement plans can sometimes be avoided. IRA's (Individual
Retirement Accounts in the US) are usually optional. In Canada,
plans called Registered Retirement Savings Plans (RRSPs) are also
optional. If you have the option do not bother paying into these
type of plans.
registered financial advisor (at least the great majority of them)
will try to persuade you to do so. But he is running on the premise
underwhich he was trained which states things like "stock markets
always go up in the long run" and the belief that the current fiat
monetary system is a permanent fixture for eternity. He, as usual,
Under his thinking
it makes sense to shelter some of your income now to get a tax break
in the present and to delay paying those taxes in the future. But,
with the coming bankruptcy of socialist styled fascist democratic
nation-states and the collapse of the entire fiat monetary system
this plan makes no sense. In fact, what is the most likely thing
to happen is that as western governments collapse they will look
at funds in accounts like IRAs and RRSPs as lucrative spoils by
which they can confiscate or tax to stay alive a little while longer.
As well, most
retirement savings plans (not all, see below) restrict you on your
choice of investments and so you are limited and not able to invest
in things like gold or silver bullion held abroad... so by putting
funds into these accounts you are often stuck with investing in
asset classes that will collapse in the coming years, such as the
entire bond market.
And, even in
the off chance that somehow these nation-states and their currencies
can stay alive for another decade or two until you "retire" they
will be in such a tattered state of affairs that the tax rate will
be extraordinarily higher than it is today... so paying less tax
now at lower rates in order to pay a higher tax rate in the future
also makes no sense.
So, if you
have yet to contribute to these kind of funds and have the choice
to not participate, don't do it.
IF YOU ALREADY HAVE FUNDS IN IRA'S or RRSP's?
is different and has different plans and tax laws so it is difficult
to get into exact details for each. But, let's take the US as an
In the US there
are two main types of tax-sheltered retirement plans: 401k's and
IRA's. Often with a 401k there are severe penalties if you withdraw
the money while you are still working for the company in which you
were employed when the funds were contributed or before a certain
age. Depending on the penalty, each individual needs to make their
own decision on whether to withdraw the funds. Keep in mind that
many of these funds are invested in assets that can and will go
to zero so even a severe penalty may be worth getting the funds
out and invested into something safer such as precious metals or
other hard assets that will not become worthless in a fiat currency
In the case
you wish to keep the funds in the plan then sometimes there are
options to have ownership and control over what the funds are invested
in. In the US this is called a Self-Directed IRA (see TDV's
Self-Directed IRA here). This enables you to invest the funds
in almost any asset on Earth so it is much better than the majority
of IRA plans where you are severely restricted as to what asset
class and what geopolitical region you can invest in. Once you have
a self-directed IRA set-up you can get a) your assets outside of
your home country to make it difficult to seize them and b) can
invest in asset classes like gold bullion which will survive your
country's financial and monetary system collapse.
IS A MARKETING CONSTRUCT
As part and
parcel with the bill of goods you've been sold telling you that
you need to go to 16 years of indoctrination training (school and
college), work forty years in a cubicle and not ask questions, they
needed to come up with something that made it all seem worthwhile.
That carrot is the concept of "retirement". You see, if you can
get through the nearly 20 years of child slave camps and 40 years
of slavery where the majority of your income is taken and the rest
is eaten up in interest costs for mortgages and loans so you can
have a house and car, then you need a reason to do it all.
apparently, is that once you hit 65 you can stop going to work and
can lie on the beach everyday. Of course, most people soon find
out that lying on the beach everyday is fairly boring... and the
lifestyle change is so great that many people have heart attacks
in the weeks and months after "retirement" anyway.
A much better
way to live is to realize that all of this apparatus built up around
us is mostly false... avoid public schools (home school or unschool)
and socialist colleges (all info is freely available on the internet
with no massive student debts or being pepper sprayed) as much as
possible and start up your own business or become an independent
contractor preferably in one of the dozens of countries that
has no noticeable taxes, regulations, and licenses that squeeze
the incentive out of everyone. And, with all the money you make
and the millions you will save from not having to pay egregious
amounts of tax in the western world you can afford to do whatever
you want whenever you want.
thing. You'll probably never want to "retire" because you'll be
having such an enjoyable time doing what you are doing.
Your Gold Out of Dodge" is available here. It is free
to TDV and TDV
Golden Trader subscribers or for a one-time price of $44.95
USD. It may be the best use of your fiat Federal Reserve Notes
you've ever spent. Reprinted
with permission from The
May 3, 2012
Berwick [send him mail]
is an anarcho-capitalist freedom fighter and Chief Editor of the
libertarian, Austrian economics grounded newsletter, The
Dollar Vigilante. The Dollar Vigilante focuses on strategies,
investments and expatriation opportunities to survive & prosper
during and after the US dollar collapse.
© 2012 The
Best of Jeff Berwick