I need to tell you a number that changed how I think about every dollar I own.
That number is 11%.
Not 11% returns. Not 11% interest. Eleven percent is the minimum your money needs to earn every single year just to stay even. Not to get ahead. Just to not fall behind.
If your investments aren’t clearing 11% annually, you’re getting poorer. And most people have no idea this is happening.
Let me show you the math.
The Debasement You Don’t See
You probably know about inflation. The government tells us it’s running around 3% right now. That means a $100 grocery bill today costs $103 next year. Annoying, but manageable.
What they don’t tell you is that inflation is only half the story.
The other half is debasement — the rate at which governments are printing money and expanding the monetary supply. Globally, central banks are increasing liquidity at roughly 8% per year. That’s not inflation. That’s your currency losing 8% of its purchasing power every year through dilution.
Think of it like owning stock in a company that keeps issuing new shares. Even if the company’s earnings don’t change, your slice of the pie keeps shrinking. That’s what’s happening to every dollar you hold.
So the real hurdle rate is 8% debasement plus 3% inflation. That’s 11%.
What This Means for Your Retirement
Let me make this personal.
Say you’ve got $500,000 in a retirement account earning 5% annually. You might think you’re doing okay. Five percent is better than a savings account, right?
Wrong. At 5%, you’re losing 6% of your purchasing power every year. That’s $30,000 in real terms — gone. Not because you made a bad investment. Because the rules of the game changed and nobody told you.
Over 10 years at that pace, your $500,000 has the purchasing power of roughly $270,000 in today’s dollars. You didn’t lose a dime on paper. But you lost nearly half your wealth in reality.
This is the quiet crisis facing every Gen X and Millennial who’s trying to build long-term wealth. I wrote about why your 401(k) alone won’t cut it back in 2019 — and the math has only gotten worse. The traditional playbook — save money, buy bonds, maybe a few index funds — was designed for a world where debasement ran at 2-3%. We don’t live in that world anymore.
Why This Is Happening Now
You might be wondering: if debasement is so bad, why is nobody talking about it?
Because it’s politically useful.
The U.S. government is running $2 trillion annual deficits. Not during a recession. Not during a war. During what they’re calling “the best economy ever.” Stock market at record highs. Real estate at record highs. Unemployment near historic lows.
And we’re borrowing $2 trillion a year. I’ve been tracking government debt and what it means for your portfolio for years — and the trend keeps accelerating.
As Dan Morehead, one of the most respected macro investors in the world, put it: “If you run a $2 trillion deficit in the good times, it’s scary to think of what could happen in the bad times.”
The Federal Reserve just held rates at 3.5-3.75% after cutting three times. But they can’t raise rates because the government can’t afford the interest payments on its own debt. The Treasury needs to refinance roughly $9 trillion in the coming years. Higher rates would blow a hole in the budget that makes $2 trillion deficits look quaint.
So the only path forward is the one we’re on: keep debasing the currency, keep rates manageable, and hope productivity growth (read: AI) bails everyone out before voters notice.
The Trap — And How to Escape It
Here’s the thing most financial advisors won’t say out loud: the traditional 60/40 portfolio doesn’t clear the hurdle rate anymore.
A typical 60/40 portfolio has returned about 7-8% annually over the last decade. That sounds solid until you subtract the 11% hurdle rate. You’re underwater.
So what actually clears 11%?
I’m not going to pretend there’s one easy answer. But I’ll tell you where I’m looking:
Assets that benefit from debasement instead of being destroyed by it. When governments print money, hard assets and scarce digital assets absorb that liquidity. Gold has returned over 20% annually over the past five years — and was up more than 60% in 2025 alone. Bitcoin, despite its volatility, has averaged over 50% annually over the past decade. Even the S&P 500 has managed 12-14% in recent years — barely clearing the bar.
The point isn’t that you should go all-in on any one thing. The point is that you need to understand the game has changed. Cash and bonds aren’t “safe.” They’re guaranteed losers in an 11% hurdle rate world.
The safest thing you can do is nothing — and that’s exactly what will make you poorer.
What I’m Doing About It
I’ve written before about my approach: quality stocks I’ll hold for 10+ years, Bitcoin as a scarce asset position, and gold as insurance. I’m not changing that.
But understanding the 11% number has sharpened my thinking. Every investment I consider now gets filtered through one question: “Does this clear 11%?”
If the answer is no, I need a very good reason to own it.
I want you to do the same exercise. Pull up your portfolio. Add up your actual returns over the last year. Then subtract 11%. That’s your real return. If it’s negative, you’re falling behind — no matter what your statement says.
This isn’t doom and gloom. It’s math. And once you see it, you can’t unsee it.
The Bottom Line
The 11% hurdle rate is the most important number in personal finance right now that nobody is talking about.
Your savings account at 4.5%? Losing ground. Your bond portfolio at 5%? Losing ground. Your “balanced” fund at 7%? Still losing ground.
The only way to protect your purchasing power is to own assets that benefit from the very debasement that’s destroying your cash. That means hard assets, scarce assets, and equity in businesses that can pass along price increases to their customers.
I’m a CPA. I spent my career thinking in terms of debits and credits, income and expenses. But the biggest line item affecting your financial future isn’t on any tax return. It’s the 11% being silently stolen from every dollar you own.
Now you know the number. What you do about it is up to you.
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Disclaimer: Not financial advice, educational purposes only. The views expressed in this article are my personal opinions based on my own research and analysis. I am not a registered financial advisor. Nothing in this article should be construed as a recommendation to buy, sell, or hold any asset. Do your own research and consult with a qualified financial professional before making any investment decisions.