The Greatest Danger to Your Retirement Savings?

And nothing, as it turns out, is the most powerful force in investing. Depending on how you deploy nothing, it can be a force for good… or it can be destructive.

The nothing we’re talking about in today’s dispatch is “inertia,” the human tendency to do nothing when confronted with a difficult choice.

Procrastinate.

Sit on your hands.

Go bathe the cat, instead.

Leave the status quo unchanged because that path is a whole lot easier than actually doing something.

Doing something, it turns out, is actually kinda hard.

To do something, you gotta think about the options. You gotta figure out what you want to do. Then you have to execute. And then, just as you’re about to execute, you second-guess yourself and wonder if it would be better to just do… nothing.

Straight up: My aim with today’s dispatch is to get you to abandon nothing and to do something instead.

The something I hope you do is sign up for my upcoming Retirement Income Masterclass. And yes—that is way more used-car salesmen than I ever want to be. But to me, we are in a moment where nothing—where inertia—has the power to undermine your financial life in painful ways.

So, instead, if I get you to kick inertia in the butt and do something, then I’ll know at the very least that I helped you prepare for what’s coming.

If you’ve been a Field Notes reader for more than a minute, you know that my gravest concern are the years from 2027/28 through the end of the decade, maybe into the early 2030s.

America is on a path to a crisis, and the years through the end of this decade are likely to witness the implosion.

I don’t say that to scare you in any way. I say it because it’s the cycle of history. We need to accept that and prepare our finances as best we can.

Humanity ebbs and flows through cycles. I wrote about that nearly three years ago, back in the April 2023 issue of Global Intelligence Letter, from which I stole this passage:

History, based on how we’re taught it in schools, centers on which year a certain war started or ended… or which Democrat won the White House in a specific year, and which Republican replaced him four years later.

But in truth, these are merely niggling details. Asterisks on a very long timeline.

Real history is about the big, broad sweep of time. Trends that play out and repeat over the course of years, decades, or even centuries.

We are now at the tail end of the current historical cycle. This is the phase of the cycle that culminates in crisis before reemerging as a better and brighter age—the beginning of the next cycle. That comes sometime in the 2030s.

For now, we’re in the defining moment of the Final Crisis, and the key characteristic is going to be the death of the dollar as King of the World.

I know that’s a big, bold, brash—maybe even arrogant—assertion.

Alas, it’s just the way this Final Crisis is shaping up.

And to be clear, I’m not saying the dollar is a bad currency. It’s a fine currency. But currencies are merely tools wielded by governments to affect local economies. And governments, on the whole, are narcissistic, self-centered organisms that exist to better the lives of politicians, which means the fate of the currency is tertiary to the fate of government and the politicians employed therein.

The dollar has served the world admirably for the better part of 80 years.

Now, that is demonstrably ending.

I’ve documented this over the last many years. The gist of it is that nations globally are structurally reshaping the global financial system and the global infrastructure to bypass the greenback. The dollar simply has too much baggage—be it extreme and rapidly expanding debt, debt-repayment costs that now consume more than 15% of the budget, a circus running the government, hatreds shredding social cohesion across America, and central banks all over the world persistently purging dollars to soak up more gold.

The impact of all of this is lost faith in the American currency.

You don’t get that back.

Currencies have a one-shot run at ruling the world. When the king is dead, another steps in to claim the crown.

Now, here’s where I am going with all of this: Relative to your investment portfolio, doing nothing—practicing inertia—means you’re willfully preparing to get caught up in America’s Final Crisis.

Your wealth declines.

Your purchasing power shrinks as the cost of living in the US surges at, potentially, hyperinflationary rates.

Doing something—fighting back against inertia—means you are willfully preparing to survive and thrive in the crisis.

Your wealth increases.

You preserve your purchasing power even as consumer prices rise all around you.

To reach that point means to think differently.

It means putting wealth to work in assets that are built to weather inflation, and which rise in value and generate increasing amounts of income as the dollar’s value sinks.

That’s particularly true of retirement wealth.

In a recent conversation with my 29-year-old son, I shared with him the fact that I have survived every downdraft Wall Street has plated up since the Black Monday crash back in October 1987.

My point to him was that I don’t have time for another Mulligan, another swing at the ball. I want my current portfolio to see me through to the end.

Which means that in recent years I have been hyper-focused on quality assets that kick out income. I want my portfolio to grow by way of asset-price increases, but also because the assets I own are regularly spinning out dividends and other forms of income.

And that’s what my Retirement Income Masterclass is all about—distilling my thinking over the last decade into a series of lessons and recommendations for building a retirement portfolio aimed at helping folks generate more income from their assets.

That’s all I’ll say about it. I really don’t want to be that used-car salesman.

But I will add that, as of this moment, the income portfolio I’ve built for the masterclass is kicking a yield right at 8%, well above the 1.15% you’ll find in an S&P 500 ETF right now, and about 2x what a one-year CD offers… and those rates are heading lower soon.

So, don’t do nothing.

Do something.

Your retirement self will thank you later.