What’s Retirement, Anyway?

Do you worry about whether your retirement account will get you through your golden years? A lot of people do. The government has created tax laws that forced most people’s retirement planning into IRAs, 401(k)s, 403(b)s, and so on. Even the names are from the tax code. Ever wonder why?

Because government is owned by banks and other big businesses, and your money is most easily accessed by them when it exists in digital form in an account somewhere. They can trade with it, and they can blow it up, and then they can hit up their pals in Washington to save them after it blows up.

Now that the system is basically shot, those who thought stocks were a swell way to retire by just checking boxes on the company form for how much to put into small companies, large companies, and foreign companies, are realizing that it’s a very real possibility that none of them are going anywhere for the next ten years. Don’t laugh. Under Steve Ballmer, even the once great Microsoft has gone nowhere for the past 10 years. Put the right bozos in charge, and stagnation can happen to any organization, whether a company or a country.

The system won’t change, so you have to change. What does retirement mean to you, anyway? Is it an amount of money spit out at the bottom of a long planning form sent to you by one of the corporate brokerage firms? Sure, money’s part of it. Probably not all of it, though.

Why not set yourself up a business that can keep operating even when you don’t feel like working as much? Get it going well, find someone to manage it, pay them, keep the difference. That’s a retirement. Notice that it doesn’t require any cooperation from corrupt markets, nor is it associated with any certain age. Why, get it right soon enough and you could retire five years from now — no matter how old you are today.

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One Comment

  1. geoffrey
    Posted June 17, 2010 at 11:05 am | Permalink

    Good article, Jason. You’ve been on fire lately. This brings up an interesting point that I’ve been wanting to ask you for a while. Your strategies, advice, and books all focus on stock and ETF investing. However, I’m willing to bet that most of us have employer-backed 401k (or similar) retirement accounts. How can we apply some of your principles to our mutual fund laden 401ks? Most people (myself included) probably use DCA in our mutual funds and rebalance periodically. I got reamed by this in the last downturn, and have been trying to devise better strategies to pull out similar to how I would with ETFs or stocks.

    Of course, many 401k plans have limits to how many transfers you can make in a quarter, but maybe some discussion here would be worthwhile. For example, how would your VA strategies described in the “Neatist” book work here?

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