How to lose $50,000 without knowing

According to the latest statistics, the current inflation rate is about 6.8%. Of course, the government will tell you that the core price index (CPI) is only at around 1% or so after removing the prices for gas and foods. I know Bernanke and the like don't use gas and don't eat foods; so in their book such price increases do not count for inflation. As a normal person, I do feel strongly what the impact of inflation is as we pay everything necessary for the daily life much more these days than before. I guess it is the same for you as well. So how you can lose $50,000 easily even without your knowing it? Just think about how much you may get from your saving account. It will be really great if you can find something around 1% these days. So suppose you have $1 million in your saving account. At the end of the year, how much will you get in terms of the buying power? It is really a very simple math: you will lose about 5% of your money by simply "saving" your money in the bank, that works out about $50,000 for every million dollars. Of course, this is just a metaphor to make my point easy to understand.

To avoid being ripped off in such a way, you really have to save your cash in real money, which can keep its value. I guess you know which direction I'm going: yes, only gold and silver are real money now. Unfortunately not many people really understand this. They still love to ONLY keep their cash in the fiat (paper) money. I did a non-scientific survey among my colleagues a year ago at a meeting. Among 10 people or so, no one except me had bought any form of gold or silver. I did this again a while ago after a year for the same group, the result was still the same but only with some remorse that they should have listened to me and bought some a year ago. If you happened to have bough some physical gold or silver (not gold/silver mining stocks), you really should not care in any sense how much it is worth in dollar terms. Just treat it as your saving, the real money you have. That's it. Don't think about it as an investment. The gold and silver are just your money in your holding and they will not lose their buying power over time like the paper money.

For those who cannot sleep if gold and silver fluctuate in dollar values, I find something which may fit into your style: principle guaranteed investment in precious metals. I have talked about EverBank before and I just noticed that they are offering such a CD now. Please read the information carefully as it may not be the kind of investment you want. More specifically you have to tie up your money for 5 years and your total gain will be capped at 50% at the most to exchange for the safety of the principle. I'm personally not that much interested as I think I can do much better than that with my money. But it may be the right product for you.