{"id":30104,"date":"2021-08-16T04:15:31","date_gmt":"2021-08-16T11:15:31","guid":{"rendered":"https:\/\/lenpenzo.com\/blog\/?p=30104"},"modified":"2023-10-28T08:22:50","modified_gmt":"2023-10-28T15:22:50","slug":"what-will-happen-to-pensions-if-hyperinflation-hits-the-dollar-2","status":"publish","type":"post","link":"https:\/\/lenpenzo.com\/blog\/id30104-what-will-happen-to-pensions-if-hyperinflation-hits-the-dollar-2.html","title":{"rendered":"Mailbag: What Will Happen to Pensions If Hyperinflation Hits the Dollar?"},"content":{"rendered":"<p><a href=\"https:\/\/lenpenzo.com\/blog\/wp-content\/uploads\/2014\/09\/mail.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"alignright wp-image-27083\" src=\"https:\/\/lenpenzo.com\/blog\/wp-content\/uploads\/2014\/09\/mail.jpg\" alt=\"mail\" width=\"396\" height=\"263\" srcset=\"https:\/\/lenpenzo.com\/blog\/wp-content\/uploads\/2014\/09\/mail.jpg 500w, https:\/\/lenpenzo.com\/blog\/wp-content\/uploads\/2014\/09\/mail-300x199.jpg 300w, https:\/\/lenpenzo.com\/blog\/wp-content\/uploads\/2014\/09\/mail-50x33.jpg 50w\" sizes=\"auto, (max-width: 396px) 100vw, 396px\" \/><\/a><strong>Hi Len, I&#8217;ve been reading your blog for close to a year now and love it! Do you think traditional pension payments will increase in some way during hyperinflation? While anything can certainly happen in the financial chaos, it seems there would be some sort of increase to keep the basics afloat for seniors and others dependent on such income. Any guidance would be greatly appreciated. Thanks for your time and keep up the good work! &#8212; Trent<\/strong><\/p>\n<p>Thank you, Trent. I&#8217;m so glad you are enjoying the blog!<\/p>\n<p>Hyperinflation is not a monetary phenomenon; it is a psychological one that results <a href=\"https:\/\/lenpenzo.com\/blog\/id24347-brazilian-hyperinflation-a-reader-explains-what-life-was-like-2.html\" target=\"_blank\" rel=\"noopener noreferrer\">when confidence is lost<\/a> in a nation&#8217;s currency. Because the US dollar&#8217;s last connection to gold was completely severed in 1971 &#8212; the only thing backing those green pieces of paper in your wallet today is faith. Therefore, if the dollar experiences <a href=\"https:\/\/lenpenzo.com\/blog\/id602-18-scary-things-you-didnt-know-about-inflation-and-hyperinflation.html\" target=\"_blank\" rel=\"noopener noreferrer\">hyperinflation<\/a>, those pensions will become worthless if only because, by definition, they&#8217;re denominated in paper currency that no longer has any value.<\/p>\n<p>Here&#8217;s what my <strong><em>very cloudy<\/em><\/strong> crystal ball tells me: Those with private pensions will be completely out of luck. On the other hand, after a new currency is established, I can envision a scenario where public pensions might be restored to some degree, if only because the government has the power to levy taxes. However, I suspect those payouts would be, at best, a mere pittance compared to what was originally promised &#8212; after all, anything more than that would most likely bring out the torches and pitchforks from a financially devastated public who would be forced to pick up the tab. As for Social Security, my crystal ball says it will carry on in some form for those who were already collecting it &#8212; again, most likely at mere subsistence levels for everyone. I think the rest of us will be out of luck.<\/p>\n<p>The moral of the story is this: The only person you should be relying on for your retirement is <em><strong>you<\/strong>!<\/em> Not the government &#8212; and not your private employer. That means putting at least <a href=\"https:\/\/lenpenzo.com\/blog\/id23998-economic-collapse-101-how-much-gold-and-silver-should-people-own-3.html\" target=\"_blank\" rel=\"noopener noreferrer\">a portion of your long-term savings<\/a> into physical precious metals, and investing in skills and real assets that can provide you with a steady income stream even after you retire.<\/p>\n<p><strong>While having been continuously employed through more than 14 years with no internal upward opportunities I&#8217;ve decided to change careers in my late 40s. I&#8217;ve been accepted into an accredited accelerated one year BSN program and would like to become a Nurse Practitioner. Funds have been set aside to cover the tuition, six-month emergency fund and my living expenses. I will not touch my 401k savings and have no dependents. In this economic environment do you think it is an unwise move to give up my steady income and study for a year? I&#8217;m concerned that if I stay at my current job I&#8217;ll become unmarketable at some point, which is why I started working on my back up plan: preparing for nursing school and saving. What do you think? &#8212; Luke<\/strong><\/p>\n<p>Congratulations on being accepted into a nursing program! Since you already have your tuition, living expenses, and emergency fund in hand, there is minimal financial risk while you&#8217;re getting your BSN. Of course, registered nurses are in high demand. In fact, the US Bureau of Labor projects almost 225,000 additional RNs will be needed between now and 2029, so your risk of being unable to find future employment is low too. To top it all off, <a href=\"https:\/\/www.bls.gov\/ooh\/healthcare\/registered-nurses.htm\" target=\"_blank\" rel=\"noopener\">the median wage<\/a> for an RN in 2020 was $75,330.<\/p>\n<p>Based upon what you told me, it seems as if the potential risks of staying in your current job are much higher than the risks of quitting your job to expand your skills and improve your future marketability. In short, Luke, I think your decision to become a nurse is sound. Best of luck to you!<\/p>\n<p><em>If you have a question you&#8217;d like me to take a crack at answering, send it to: <strong>Len@LenPenzo.com<\/strong> &#8212; and please be sure to put &#8220;Mailbag&#8221; in the subject line.<\/em><\/p>\n<p style=\"text-align: right;\"><span style=\"font-size: smaller;\">Photo Credit: gajman<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Hi Len, I&#8217;ve been reading your blog for close to a year now and love it! Do you think traditional pension payments will increase in some way during hyperinflation? While anything can certainly happen in the financial chaos, it seems there would be some sort of increase to keep the basics afloat for seniors and [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":29336,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_mo_disable_npp":"","pmpro_default_level":"","_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"_genesis_hide_title":false,"_genesis_hide_breadcrumbs":false,"_genesis_hide_singular_image":false,"_genesis_hide_footer_widgets":false,"_genesis_custom_body_class":"","_genesis_custom_post_class":"","_genesis_layout":"","footnotes":""},"categories":[462,489,482,464],"tags":[],"class_list":{"0":"post-30104","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-jobs-work","8":"category-macroeconomics","9":"category-mail-bag","10":"category-retirement","11":"pmpro-has-access","12":"entry"},"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v22.8 (Yoast SEO v27.4) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>Mailbag: What Will Happen to Pensions If Hyperinflation Hits the Dollar?<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/lenpenzo.com\/blog\/id30104-what-will-happen-to-pensions-if-hyperinflation-hits-the-dollar-2.html\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Mailbag: What Will Happen to Pensions If Hyperinflation Hits the Dollar?\" \/>\n<meta property=\"og:description\" content=\"Hi Len, I&#8217;ve been reading your blog for close to a year now and love it! 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