Not one person in 10,000 understands what I am about to say. Keeping your retirement money in any dollar-denominated investment is the surest way to lose your wealth.

Preservation of wealth should be your strategy in these uncertain times. You cannot do that with most stocks, bonds, mutual funds, insurance policies, annuities, money markets, CDs or savings accounts.

The key to understanding why this is so, is understanding the nature of the US Dollar. The dollar was formerly backed by gold or silver. During this period, inflation was almost non-existant. I remember seeing the very first version of a mimeograph machine from the 1800s in a museum. It had a beautiful cast iron stand. Cast into the sides of the stand were the prices for the supplies that the mimeograph used! How could they do this? What if prices went up? Well, prices were so stable that they didn't change for years-even decades! This was typical under a gold and silver-backed dollar.

In 1933, things changed and the dollar was no longer backed by gold for US Citizens. In 1971, it was no longer redeemed for gold for international trade purposes. The dollar became a "fiat" currency, one that has value because the US Government says is does. Well Inflation really kicked in at this point. I was born in 1957, the dollar has lost 84% of its purchasing power in my lifetime, according to the inflation calculator on the Federal Reserve website.

Sadly, "fiat" currencies have been tried by many governments throughout history, the result was always the same...fiat currencies always loose value through inflation until they are only worth the paper that they are printed on.

The dollar is no different. What I have done to protect my money for retirement is to buy gold and silver coins, gold and silver eagles minted by the US Mint are my favorites. They are available at jewelry stores, coin shops, and from the US Mint directly. Be careful where you store them. They are often a target for thieves and burglers. I keep very few in my home, most are buried in small caches in places known only to myself, my spouse and a trusted relative.

Once the dollar has lost its value and a new currency is in place, then it may be time to cash in my gold and silver and invest back into stocks, and bonds. But unitl then, I am content to preserve my money for retirement using the wealth preservation qualities that have made gold and silver the wealth preservation method of choice for thousands of years.

Learn more about this author, Jim Macintyre.
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