Did I just ask you to stop accumulating funds for retirement? Yes. Or maybe the precise sentence should be “Don’t accumulate funds for retirement at all.”

I don’t blame you. The federal government and finance industry, consciously or unconsciously, have initiated and protracted the retirement con. They generated several retirement schemes like IRA’s and 410K account along with financial investment benefits like index funds and mutual funds, which induces every individual to save funds and lock it in safety (some unsafe) boxes and lug it out when you aren’t quite fit to enjoy the wealth you have created.

The finance industry will, of course, promote saving for retirement. Till the time you are 60-65, they have generated fortune using your funds for several years. For them, it’s a source of capital.

And why will the government ask you to withdraw the money from their accounts? You are very much depended on the agencies they have created. The whole population is depended. This also keeps people slogging in companies and factories for years. If this isn’t the case, why do they charge you penalties and fees if you extract money from your own account to… to enjoy your own life? You have a better reason?

These strategies initiated by government, which should have been for the betterment of the population, are not rational anymore because:

-    Wealth generation isn’t what people are looking for today. Investing is good, but what’s the use of these accumulated funds if the reaped benefits cannot be enjoyed for most part of the life.

I am not against any IRA plans or the 401K nor do I oppose the idea of investing in index funds and mutual funds. However, I do oppose the system that penalizes and taxes the saving people. The current tax structure, instead of encouraging, discourages people to save money for long term.

Why do we pay taxes on the money that we are accumulating since last many years, and recently withdrew because of an emergency? Why can they let our money compound and form a huge fund instead of just taxing us. Sales tax makes sense, and so does flat tax and graduated tax. But how can the government explain such confiscatory tax system?

Instead, they can tax the amount of money that is withdrawn by people for expenditures. Why tax the entire income, even if a part of it is going into a financial instrument, which is being promoted by the government itself. Stop levying tax on savings.