This Is Your Retirement… Cut in Half

By Lou Basenese, on Tuesday, October 15, 2019

The jig is up.

For the last couple of weeks, we've been warning you about the risks you're facing as you approach retirement.

As we’ve been explaining, not only are most Americans completely unprepared, but government “safety nets" like social security can no longer be counted on.

Then, last week, the Federal Reserve announced something that makes things even worse. In fact, its announcement could cut your retirement savings in HALF.

So today, we'll explain what happened…

And then we’ll show you the single step to take so you can retire safely and comfortably!

Rev Up the Printing Presses

Last week, the Fed made a horrifying announcement:

To fund U.S. government spending, it would be revving up its presses to print money…

And from now on, the presses would be running permanently.

You see, our budget deficit used to be funded by investors like China. They loved buying our bonds. But the trade war has brought an end to that relationship, and other major investors have grown leery of our soaring debts.

So the Fed was forced to step in and inject tens of billions of dollars into the system.

Unfortunately, this is taking something bad and turning it into a disaster…

Prior to 2008, the Fed was holding about $900 billion of U.S. bonds.

But today, that figure stands at $3.7 trillion — and now it’s started to grow like a weed.

The Joys and Dangers of Printing Money

Paying government bills by printing more dollars might seem like a harmless solution.

After all, there’s nothing backing these dollars…

They’re just pretty pieces of paper.

But for future retirees, there’s an enormous danger to this strategy:

Printing money leads to inflation!

Your Retirement Dollars… Cut in Half

Inflation is a silent killer.

It causes the prices of goods and services to go up and up.

In other words, inflation makes the dollars in your retirement account worth less and less.

Even when inflation is relatively low — for example, 3% per year — after 20 years, something that used to cost $1 would now cost about $2.

That is very bad news for retirees:

It means your retirement nest egg will only buy half as much as you thought it would….

And it means it’ll only last half as long as it was supposed to.

And again — that’s with low inflation…

If the Fed’s permanent printing presses lead to the type of inflation that was experienced in Germany in the 1920s, or in Zimbabwe in 2008, eventually, prices will double every few days.

The thing is, there’s no reason to get melodramatic here…

Even with low inflation, if you once thought you'd need $1 million to retire comfortably, now you'll actually need $2 million.

This is a frightening situation.

What’s the Solution?

According to an independent think tank called the Economic Policy Institute, the average working-age family in the U.S. has about $5,000 in their retirement account.

And as it reported, “Nearly half of families have no retirement-account savings at all.”

Literally nothing at all.

And as you learned today, even if a family thought they had enough retirement savings, with inflation, that will no longer be the case.

So, what can you do?

You can start by staying tuned — because tomorrow, Matt will reveal the solution.

Happy Investing.


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Tags: Retirement

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