(Excerpted from Chapter 9: The Power of Compound Interest: Stickin’ it to the Matrix)
Every high school in this country should teach a required course on how to save money and, more importantly, regarding the power of compound interest.
And every parent should teach their children these same two things.
The trouble is that most parents nowadays are themselves unaware of the power of compound interest. This entire generation of parents and especially grandparents has largely bought into the matrix-controlled “get-rich” stock market scam at one level or another.
Many have taken a very cold bath. Some have taken several. And still, many cling to some fantasy that they too will be a millionaire someday if they just keep their head low and play by the matrix rules. It defies logic, not to mention indicates a moral bankruptcy unprecedented in humanity’s span of time on this planet.
The seminal event in the downgrading of the concept of savings in the US came with the Reagan Administration’s introduction of the 401K plan. This essentially privatized the retirement pension programs that most companies used to offer their employees for FREE.
The new 401K system was marketed as the best new thing since sliced bread. It sounded great since your employer would match your contributions to this stock exchange-based roulette scheme dollar for dollar.
What in fact had actually happened was that you were now matching your employer’s contribution to your retirement plan dollar for dollar, essentially taking that corporation off the hook for the other 50% of your retirement that it used to pay.
Thank you very much sir, may I have another?
Worse yet, that previously stable and secure pension fund that nearly every American used to be able to count on in their old age was tossed onto the roulette wheel of derivatives, hedge funds and dark pools. Free from these billions in pension liabilities, for a while the Dow Jones went straight up.
Some who retired a few years ago were able to ride the up escalator and retire millionaires. But that once-in-a-generation aberration has since turned into another bloodbath for the masses, most of whom saw their retirement savings flushed away when the various bankster-conjured bubbles, with names like Internet, NASDAQ and Housing, burst and came crashing to earth.
A handful of Illuminati banks own 90% of every company listed on a stock exchange. They buy low and sell high – to YOU. You are extremely naïve if you believe otherwise.
I was lucky to be burned early by these lunatics, and my losses were minimal. Ever since, I have taken a much safer and simpler approach to the retirement we are already enjoying.
We buy Certificates of Deposit (CDs) offering the highest interest rates available in the US. And our rate of return in most years beats the pants out of that which we could get by investing in stocks.
You can find the best CD rates in the country online at Bank Rate Monitor and various other sites. We are currently going through a rough patch for savers, with record-low interest rates, but this won’t last forever.
Luckily, I locked in two five-year CDs paying 5.25% and 5.26% APY respectively in 2008. Both banks get a 5-star CAMEL rating, meaning on a scale of 1-5, they are also considered to be two of the safest banks in the country. This is important.
Never invest your money in a bank that gets less than 3 stars on this scale. Try to stick with only those that get a 4 or 5-star rating. If a bank collapses, you will get your FDIC-insured money up to $125,000 per person or $250,000 per couple. Never keep more than these amounts in any one bank. Even so, it could take years to get all your money back from an insolvent bank, so stick to buying CDs at only the very safest ones.
In addition to that, buying a CD costs nothing. There are no brokerage fees and no capital gains tax when you cash it out. In normal economic times I prefer one-year CDs, since usually a better interest rate has come along by the time that year is up. But I guessed right that interest rates would go steadily down in 2008 and locked in the above rates for five years.
In the recent past I’ve gotten as high as 7% on a one-year CD. Nowadays even 5% is unheard of, but that will change.
Other than the lack of nickel-and-dime matrix fees and the fact that my CDs have easily outperformed the S&P 500 over the last 20 years; the other thing people miss about buying CDs is the difference between the interest you are now paying on a mortgage, a car, or whatever, and the interest you are being paid on a savings account or CD.
Assuming principle amounts to be equal, let’s say you have a car loan at 4% and a mortgage at 5% and no savings or CD. You’re down 9% to the matrix.
If you tighten your belt, pay off that car loan and buy even a 2% CD, you are now down only 3% to the matrix, since you still owe 5% on your mortgage, but have a 2% offset from the CD.
Now let’s say you tighten your belt even more and pay off your mortgage. You now have the matrix in hock to you at a 2% annual clip. Pretty cool!
My wife and I now live almost completely off the interest paid to us by the banksters from CDs. To me there is something incredibly revolutionary about this. Imagine if everyone could be a creditor to these scoundrels, instead of a debtor. What a different world we would live in.
Once you have the bankers paying you to live, the power equation vis-à-vis the matrix, shifts in a fundamental way. You no longer have to bite your tongue at some slave wage job which services your debt. Self-censorship (the worst kind) can end in your life once and for all.
You can quit your meaningless job and take up something that really matters to you in this world. You can cease to define yourself according to your job. What matters to me is growing food, writing, travel and political activism. What matters to you will be different.
I really do believe that everyone has a calling in life. It’s just that too many remained trapped in the matrix and never have the time to realize that higher purpose. With Americans working longer hours than ever, and husband and wife both now trapped in the matrix cubical, this has never been more true.
Computers were supposed to make things easier so we could all work less, right? Instead, these tracking devices enslave us even more to matrix central command structure, speed up our lives and consume even more of our precious time.
Economic liberation is the key to starting down a life path that has meaning. Once you have that grubstake earning you a regular income from the matrix banksters, you truly are on the road to living your dreams.
Dean Henderson is the author of four books: Big Oil & Their Bankers in the Persian Gulf: Four Horsemen, Eight Families & Their Global Intelligence, Narcotics & Terror Network, The Grateful Unrich: Revolution in 50 Countries, Das Kartell der Federal Reserve & Stickin’ it to the Matrix. You can subscribe free to his weekly Left Hook column @ www.deanhenderson.wordpress.com