And So It Begins: The Lifetime Income Option

Good doggie.  Time to beg for your treat.

I've talked a number of times about how our government - being essentially out of money - has got to find ways to get its hands on more cash.

The T-Bond market is getting ugly, fast.  No one wants our government junk bonds any more, so the Federal Reserve Bank is forced to buy (monetize) them.  They know that they can only raise taxes so far before everyone goes Black Market on them.  They'll still pass some sort of VAT, and Cap & Trade will bring in some more bucks, but not enough to feed the beast in DC.

One of the last private stores of wealth of which the government has records are our retirement plans.  IRAs and 401(k) plans.  We have something like $6 trillion in cash in these plans.  That's a big, fat, juicy-ripe apple waiting to get plucked.

The Labor Department is hosting two days of presentations and testimony to lay out their strategy as they move towards outright confiscation of our private retirement plans.  It worked in Argentina, so why not here?

At first, they won't just take your money, they'll offer you a Lifetime Income Option.  Sounds so proper and maternal, doesn't it?  Almost like Aunt Bee offering you a slice of warm apple pie.  You will have the option to get income for your entire lifetime.  Ooooooo!  Sign me up!

Here's how they'll do it:

People who lost their butts in their 401k plans will be given some sort of a bailout.  The government will go back to some past date and figure out what the plan value was at that time, or they'll come up with some minimum amount you'll get, regardless of the balance of your account.  Hey, if you join the VOLUNTARY plan, we'll buy you off!  Come on down!!  Clock's a-tickin' - make your mind up there, big guy.

Of course, most people will take the money.  The problem is, there's a catch.  Yeah, you'll get your balance increased, but you will no longer own the plan.  If you decide you want to cash-out because you have terminal cancer and you want to fulfill your Bucket List, sorry, No deal, buddy.

Your money will be converted into an annuity - a steady stream of payments - but just like Social Security, when you croak, your title to that money will die as well.

Hope you didn't plan on leaving your kids anything.

Eventually, the voluntary part of the plan will go away, and you'll only have the Lifetime Income Option for any type of tax-exempt personal retirement plan.  Lovingly brought to you by the Bank O' Nanny, of course.

How's that doggie treat tasting right about now?

Accept The Challenge

The government keeps tightening the noose on our financial freedoms.  Withdrawal too much money out of your checking account?  Flag!  Get reported to Big Bro.

If you have too much undeclared cash on your person while traveling, you'll have your money seized and will be lucky to ever see it again.  Think about that - you want to go somewhere, and if you have too much cash, you're considered to be a criminal.  WTF?!

I told you earlier about the upcoming 1099 form that will be used to track precious metals sales.  PMs are one of the last personal stores of wealth that isn't tracked, and they're working to correct that oversight.  You've got until January 2012 to figure out how you want to handle this part of your preparedness plans.

The Black Market is going to absolutely explode if this law isn't fixed.  It is going to show people how easy it is to operate outside of the prying eyes of the government, and more transactions will follow.  More taxes will gush from the government coffers, more debt will be monetized and more draconian measures will be taken.

Think this through.  You may be perfectly OK with all of your wealth and life's work being managed by the government.  Many people are.  Just recognize the inherent risks with this.

It may very well once again become illegal to own PMs.  What will you do if they tell you to turn in your gold and silver?  Are you going to willingly bow to their demands, or will you become a law-breaker?

This is rapidly moving from an academic question to a practical one.  Everything our country is doing has been done in the past, sometimes right here in America.  It's not like there isn't a precedence.  The tactics may be a bit different, but the end-game is the same.  If you control the money, you control the population.

I told my boys the entire time they were growing up that you should work at a job that you like.  If you want to be a pottery maker, that's great - just be the best you can.  You need to recognize, though, that certain jobs pay better than others.  While you shouldn't have a job only for money, you'd be a fool not to recognize that money gives you options.

You could easily exchange 'options' with 'freedom'.  The ability to live your life as you see fit.  The growing restraints being placed on us to use our money as we see fit reduces our options.  It reduces our freedom.

What are you going to do if you lose control of your money?

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Copyright 2010 Bison Risk Management Associates. All rights reserved. Please note that in addition to owning Bison Risk Management, Chief Instructor is also a partner in a precious metals business. You are encouraged to repost this information so long as it is credited to Bison Risk Management Associates. www.BisonRMA.com