I have a question in regards to the reply article on turning one’s IRA or 401(k) into a survival retreat property. Any ideas on how it would play out with one’s survival retreat that is in their IRA or 401(k) if/when the government confiscates retirement accounts or forces one to turn their retirement accounts into a government retirement account like what was recently done in Poland and other countries? Would the person lose their home/farm or be forced to sell it? Would the government get control of it?
I’m curious because we have a fairly decent amount of money in retirement accounts that I am not comfortable with keeping there. I would like to cash them out (yes, take a hit financially) to buy property and hard assets with. The problem is that my husband is not on board with that. He is still not convinced that things will go bad sometime in the future. (Sadly, I believe he suffers from Normalcy Bias.) If we were able to legally convert our accounts into something like what the article’s author stated then this might just be route that my husband is comfortable with. My big concern though is what might happen in the case of the government confiscating individual’s retirement accounts. Any thoughts on this are greatly appreciated.
Thank you for all that you do.
Peace, – T.C. in Minnesota
JWR Replies: Great question. But that presently is an imponderable, because we have no way of knowing how any such future legislation might be worded.
It is also impossible to predict how soon the U.S. Dollar will come unraveled. (It is not a question “if” but rather “when.”) The safest approach is for anyone who is age 50 or under is to cash out (biting the bullet and paying the tax penalties), and shift those funds into tangible precious metals that are kept architecturally very well hidden at home–preferably mostly in small denomination silver that has a low risk for counterfeiting. (Well-worn non-numismatic pre-1965 “junk” silver is the lowest risk. It is also the most recognizable for barter.) The slightly less safe approach is to roll over 401(k)s and IRAs into precious metals IRAs, under custodial control, and hope that the government doesn’t get grabby before you retire. The most risky approach is to blithely assume that the U.S. Dollar will still have its full value in 20 years, and leave your 401(k)s and IRAs in typical stock portfolios. Unless you are presently close to retirement age, the latter approach is foolish, in my opinion.
With many more Federal budget crises on the horizon, one other legislative threat to 401(k)s, IRAs, and Social Security is an elevation of the defined retirement age and fund distribution age. It is conceivable that with an act of of congress, the retirement age could be raised to 70, just before you turn 65. (“Just five more missions, Yossarian!”)