Wednesday, January 01, 2014

Starting New Year With Max IRA Contribution for 2014

I started my new year off right by making the maximum possible contribution to my IRA today.  That's $5500 according to the IRS, same as last year.  This will enable me to defer more capital gains on my investments until my elderly years.  I'm a firm believer in using every legal mechanism possible to enhance my own wealth.

I have considered the possibility that the federal government may confiscate tax-advantaged retirement accounts or mandate their investment into government bonds.  I do not believe an outright confiscation is possible as long as the financial sector makes heavy campaign contributions to federal politicians.  There is a small possibility that the government could direct IRAs and 401(k)s to buy government bonds but I believe that is unlikely.  I do not listen to nutcase talk radio or read radical blogs that get whipped up over paranoia.  There is little need to force individual investors to buy bonds now that the Fed has proven itself able to purchase almost all new Treasury issuance.  This does not excuse the Fed of its irresponsible QE policy.  It does mean that investors will likely retain their retirement accounts as vehicles for hedging inflation with hard assets.

I don't make New Year's resolutions.  Alfidi Capital will continue doing what it has always been doing since 2008.  I will keep telling the truth and making money.