The current world is a place where the context of reality in financial and political circles is constantly changing. Many people have built their financial futures around a framework of rules that they assume will continue throughout their retirement years. While we remain hopeful that the promises made in the past will be honored in the future through stable rules and consistent laws, our intuition tells us to be cautious. As the inevitable collapse of the government-entitlement state draws near, lawmakers will begin to consider desperate acts to maintain their grip on power.
One of the most attractive targets in this terminal lust to maintain power is the accumulated retirement assets of the nation’s labor force in the form of their IRA’s and 401k’s. As intelligent investors, we must understand that the risk of our retirement assets being confiscated by the government is more real than most are willing to admit. Each of us should look for ways that we can diversify the exposure of our retirement assets so that we will be able to adapt quickly if the rules are abruptly changed.
In the end, each of us will ultimately be left to ourselves to provide for our personal financial future. The government is woefully unable to continue with its promises of the past without a significant increase in the level of wealth that it collects to fund its spending. Regardless of whether these additional resources come from creating inflation through money printing or through outright confiscation, the result will be a dramatic shift of real resources away from people who spent their who lives saving and investing. As intelligent investors, we must proactively adjust our strategy as we go so that it remains flexible as the world around us continues to shift and change. (Top image: Flickr | Infrogmation)
The Jason Hartman Team
