Stacking Gold for Pension
September 15, 2014 [...]
When putting together pension funds, ideally one should construct a diversified portfolio.
Paying the contribution to the state is one thing pretty much everybody is doing. Some also resort to the services of private pension funds.
But, fiat money-based funds are just as good as fiat money.
In the event of a currency devaluation or, if the private pension funds go bankrupt or, if the pension funds get nationalized/redistributed elsewhere or even stolen, then you will lose you will be at peril in your elderly years.
When we say: "don't put all your eggs in one basket" we should rather: "don't just put eggs in your basket".
Again, precious metals come in to diversify your pension fund.
Create a personal pension savings fund in solid metal.
This literally means: stacking precious metals for pension.
In the very long run, gold and silver will outperform fiat currencies.
Stacking gold and silver is not just a security measure for a total socio-economic collapse, because currencies will devalue anyway.
Natural inflation erodes the long-term value of any currency. In fact, a well-performing economy requires at least a little inflation.
This is a natural by-product of any growing economy.
Healthy inflation for the economy brings peril to the currency in the long-run.
Let's see a concrete example...
If you save 1,000 USD in a year and there's an average 5 % inflation rate that year, then your money will be as good as 950 USD next year.
And we didn't count specific inflation rates - such as food price inflation, which often exceeds 25 % in some parts of Europe and the USA.
Bottom line is, you will lose 5 % of your money's worth and let's imagine a positive scenario, when your country's currency will continue to inflate by only 5 % per annum.
Your money will slowly erode over time. How much will it be worth 25, 30, 50 years later?
Do your own math based on your age and the period after which you expect to become a pensioner.
States' funds generally calculate current pensions based on current economic realities. But this will never really compensate you for the loss of wealth due to inflation.
And we still didn't talk about hyperinflation.
But precious metals don't inflate and don't erode. Price fluctuations will even out over a longer period of time and should your national currency lose value, gold and silver will rise in relation to it.
Owning both gold and currencies is like having a old mechanical scale.
If one side of the scale goes down, the other side rises. This is how precious bullion in your portfolio can compensate fiat money's loss of value.
Gold is the ideal precious metal for building up a personal bullion-based pension fund.
It is more stable than other precious metals in terms of price and it will be easier to sell.
It's wise yo buy the price dips instead of using the DCA/CCA method (which means buying gold periodically regardless of the price, believing that the average price in the end will come out well).
Depending on where you live and on how high your income is, you calculate an approximate amount of solid gold bullion that you will have after an "x" amount of years.
It would sound grim to also calculate how long you will live from the time you become a pensioner. But, many peoples young years plus active working years tend to be a longer period than the last phase of their life.
So, accumulating gold on a regular basis can leave you with a nice stack to consume gradually when you are old.
Gold also comes in handy as an emergency medical fund.
If you accumulate an average of 10 grams of gold per year, from your age of 20 until you're 60, then you will have 400 grams, which is 12.86 ounces.
Some are able to accumulate 1 oz per year, which in 40 years will be 40 oz (1,244 grams, which is 1.24 kilograms!).
These examples are simple, but worth mentioning in order to visualize the long-term gain.
Imagine how good it feels to have more than a kilo of gold as a security asset besides your already existing fiat-based pension fund.
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