My wife and I have a friend who recently landed a job at one of the Big Tech companies here in town.

The whole thing sounded like a pretty sweet gig. The pay was good, the benefits seemed nice, plus they offered all the extra little “perks” you’ve heard about at these types of places… snacks in the kitchen, fancy coffee, catered lunches twice a week, a bring-your-pet-to-work policy, a gym downstairs, you name it.

As she was describing all of this, she asked a question about retirement.

It all boiled down to this: “Where do I start?”

In just a second, I’m going to tell you what I told her. And later in today’s issue, I’m going to pull back the curtain on one of our big investment predictions for 2022 — and how you can profit.

---

What I Told Our Friend About Retirement Plans May Help You, Too

Now, keep in mind that the person in question is younger than my wife and I (in her late 20s, must be nice). So the first thing I told our friend is that the biggest asset she has on her side is time.

And before I continue, keep in mind that I am not a tax professional, and everyone’s situation is different.

With those caveats aside, I told her that the first thing I would do is put away every single dollar I can into a 401(k) up to whatever the company matches. It’s the closest thing you’re ever going to get to a free lunch in the financial world.

Let’s say your employer matches up to 4% of your salary dollar-for-dollar. If you make $100,000, then your $4,000 contribution turns into $8,000 — an automatic 100% return on your money. Your original contribution also reduces your taxable income. Not bad at all.

After that, this is where things become a chose-your-own adventure story of sorts.

Normally, most people would say you should open an IRA next. That’s fine, but there is one little thing you may choose to do first.

If you have a high-deductible health plan (if not, then skip this part), I’m a fan of maxing out your health savings account (HSA) next.

HSAs are great because your contributions are tax-fee. The max for 2022 is $3,650 for an individual, $7,300 for a family. You can use that money for any qualified medical expenses such as copays, prescription glasses, medicine, etc. (The IRS and your insurance provider will both have a handy guide.) You can invest this money and grow it (tax-free), although you may find that the options are rather limited. At 65, you can continue use this money for any purpose you choose (though nonqualified expenses will be taxed at your normal rate).

Then we get to IRAs. Again, you can choose your own adventure here in the form of traditional or Roth IRAs.

As you probably know, contributions to traditional IRAs are deductible and grow tax-free until you retire. You’ll then be required to make withdrawals and pay taxes on them.

Roth contributions are not tax-deductible, but they are completely tax-free after that. There are also no withdrawal requirements. General rule of thumb: If you think your tax bracket will be higher later in life, do a Roth. (This is the part where I remind you to consult your tax professional.)

A major benefit to prioritizing contributions to IRAs over a 401(k) is that you will generally have a lot more options for investing your money. Most 401(k) plans only offer funds, while you can invest in individual stocks in IRAs, for example. You also won’t get eaten up by fees like with 401(k)s.

Then we make the circle back to the 401(k). If you still have money you’d like to save, then have at it here. You can contribute up to $20,500 in 2022.

There are more details about each of these options that you should research and consider. And again, each person’s situation is different, so your mileage may vary. But this is how I laid it out for our friend, and you may want to consider this as you make your own plans.

---

2022 Investment Prediction #3, Revealed…

In the past few issues, we’ve devoted some space to tell you a little about our latest investment predictions for 2022.

As you know, these come from our colleague Jimmy Butts and his research team over at Top Stock Advisor.

We’ve told you just how profitable some of these predictions have been in the past. We’ve also made the case for why it makes sense to carve out a little space in your portfolio to swing for the fences with high-upside picks like these.

But what we haven’t done yet is really dive into the specific predictions themselves.

So today, let’s do just that. I’m going to tell you about one of our predictions that’s pretty straightforward. In fact, if you’ve been following along with us, then you know we’ve seen it coming from a mile away, beginning last year.

If you haven’t guessed by now, I’m talking about inflation.

So without further ado, here’s prediction #3:

Interest rates will surge in 2022, slaughtering bonds, and devastating millions of unprepared income investors. If the bond market crashes, that’s bad news for everyone — even if you don’t own bonds. There are few escape routes from the bond debacle that the average investor is familiar with. But we’ve found a handful of obscure lifelines that could make 2022 the most lucrative year of your life.

We made this call because we saw significant inflation coming our way from as far back as 2020. In last year’s report, we gave investors a few ideas on how to profit from soaring commodities, and those turned out well. But as 2021 came and went, we saw increased inflationary pressure.

The Federal Reserve seemed blind to the issue, calling it “transitory”.

To the average person, that means temporary. It’ll pass in due time.

The Fed tried to weasel its way out by “clarifying” what it meant as that term became increasingly politicized. But finally, they eventually relented and admitted that the inflationary pressures were higher than anticipated.

Anybody who’s had to pay for gas (or groceries or building supplies, you name it) could have told you that.

(Random question… how many Fed members fill up their own gas tanks? I doubt we’ll see anyone in the media ask this.)

So in late 2021, the Fed began to change its tune. And now, beginning this year, it’s going to start to slowing the money-printing presses.

We’re already witnessing the effect that’s having on the stock market. But we also know that the pain will extend to the bond market…

When the easy money dries up, borrowers get squeezed, and interest rates rise. Econ 101.

We’ve already seen this happen with mortgage rates, for example.

Consider this: the bond market is at least two times the size of the stock market. And since rates began to fall from historic highs in 1981, they’ve been in a 40-year bull market ever since.

We’re talking about a massive sea change after an unprecedented easy-money era.

It’s anybody’s guess what happens next. But if the bond market crashes, that’s no bueno. You don’t have to be a bond guru to feel the pain, either. This market affects everyone from retirees to homebuyers to pension funds and local governments.

Here’s what Jimmy Butts told his premium subscribers about this prediction:

To get an idea of what could happen, one only needs to go back to the 1994 bond market crisis. After a period of historically low rates (to combat the 1991 recession), the Fed raised interest rates to combat inflation.

Sound familiar?

The increase in rates prompted a mass sell-off of bonds and debt funds worldwide. Bonds lost about $1.5 trillion in market value globally.

The yields on 30-year US Treasury Bonds jumped from around 6% to over 8%. While that may sound like a nice yield, we have to remember the prices and yields have an inverse relationship.

So as yields went up, prices tanked. And it doesn’t matter how big the yield is if your capital plummets.

Over the past several months, we’ve banged the drum on many of the usual suspects: gold, TIPS, commodities, etc. All are viable options for investors who want to protect against inflation – and potentially profit.

But in our latest investment predictions report, we told investors about a unique way they can short Treasury Bonds.

Remember: If bond prices fall (and yields go up), then you make money.

Now, shorting may sound like it’s risky or complex, but there are exchange-traded funds (ETFs) that do all the work for you. You simply buy these funds, which gives you short exposure to long-dated Treasuries.

There are a few choices out there if you’re interested in researching this on your own. But please be aware that these things can be designed in some rather funky ways that don’t make them suitable for long-term trades.

But there are two ETFs that we do like for this trade that we name in this year’s report. As a potential bonus, they are leveraged, which means they will move even more dramatically than the underlying market. They carry their own risks, of course, but for the right investor who’s looking to profit from a dramatic decline in the bond market, we think they could be worth it.

To get more details on this and the rest of the predictions in this year’s report, go here now.