STABILITY ACCOUNTS

Stability Accounts

Mechanics, Investment Strategy, and Protections

Core Concept

Stability Accounts are individually-owned investment accounts established at birth for every citizen, seeded with $25,000, and designed to grow to approximately $1.89 million by age 65. Unlike Social Security (a government promise), Stability Accounts are real assets owned by individuals—the government cannot access, modify, or default on what it doesn't control.

Account Structure

Initial Funding

Transition generation: Pro-rated seed based on age (see Transition section)

Ownership Structure

Creditor protection: Accounts exempt from bankruptcy, lawsuits, garnishment

Government access: Constitutionally prohibited—cannot be taxed, seized, or modified

Inheritance: Remaining balance passes to designated heirs

Investment Strategy: DRIPS

Accounts are invested in DRIPS (Dividend Reinvestment Plans)—a diversified portfolio of dividend-paying stocks with automatic reinvestment.

Why DRIPS?

Long track record: Dividend aristocrats have outperformed market over 50+ year periods

Alignment: Citizens benefit when economy grows—shared stake in prosperity

Portfolio Construction

Rebalancing: Automatic, periodic, low-cost

Management: Independent board, not government—similar to Federal Reserve structure

Growth Projections

Optimistic scenario (9%): → $6.3 million at 65

Note: Even conservative scenario far exceeds average American's retirement savings ($87K)

Withdrawal Rules

Permitted Uses (Before 65)

Education: College, vocational training, professional development, lifelong learning

Disability: Earlier access if permanently disabled

Retirement Access (65+)

Withdrawal options: Lump sum, annuity conversion, or continued growth

No required distributions: Unlike 401(k), no forced withdrawals—can leave to grow

Inheritance: Any remaining balance passes to heirs—building generational wealth

Healthcare Deduction Mechanism

Universal coverage funded: Healthcare costs deducted from account growth (not principal)

Healthy incentive: Lower healthcare costs = more retirement savings

Catastrophic protection: Major illness doesn't wipe out account—caps protect floor

Protections

Constitutional Protection

Accounts established as constitutional property right

Government cannot access, tax, or modify accounts

Amendment required to change structure—high barrier

Key distinction from Social Security: SS benefits can be changed by Congress anytime. Accounts cannot.

Market Crash Protection

Time diversification: 65-year horizon smooths volatility

Historical resilience: No 65-year period in US history has lost money in diversified equities

Age-based allocation: Shift to more conservative mix as retirement approaches

Floor protection: Minimum guaranteed benefit if market underperforms catastrophically

Dividend stability: DRIPS focus on companies with stable dividend histories

Fraud/Mismanagement Protection

Transparency: Real-time account access, full holdings visibility

Transition for Existing Adults

Current retirees (65+): Keep Social Security, Medicare—grandfathered

Near-retirees (55-64): Choice: stay in old system or transition with pro-rated seed

Workers (25-54): Transition to accounts with age-adjusted seed (less time to compound)

Children (0-17): Full $25K seed, maximum compound time

Pro-rating formula: Seed adjusted so expected retirement value is comparable across cohorts

Comparison: Stability Accounts vs. Alternatives

vs. Social Security

Inheritance: SS = nothing. Accounts = full balance to heirs.

vs. 401(k)

Coverage: 401(k) = ~50% of workers. Accounts = 100%.

vs. UBI (Universal Basic Income)

Ownership society: UBI = recipients. Accounts = stakeholders.

Discussion Questions

Is 7% return assumption reasonable? What if lower?

How do we prevent early-access abuse while allowing legitimate use?

What governance structure best protects independence?

How do transition-generation accounts avoid resentment?

What happens if someone emigrates? Immigrates?

Should investment choices be individual or collective?

Note: Stability Accounts are the cornerstone of AIP—transforming citizens from dependent beneficiaries into capital owners. The mechanics here are designed for robustness, but validators are invited to identify vulnerabilities.