Financial Prepping?

[sdtech58]

What are some tips for financial prepping? Bill Bonner and his "Agora" group, among others, claim that a credit bubble burst is imminent. The scenario they describe is very similar to what happened in Argentina in the late 80's and early 90's. He claims cash on hand will be at a premium, along with other tangible items such as gold, silver, etc. So how does one prepare themselves financially for if and when the ATM's and banks are shut down and/or out of cash? What about when no more credit is available and your Visa becomes completely worthless?

Hardly anyone uses cash anymore, and most places give you the stink-eye when you pull out cash to pay for something instead of a credit card. What other items become valuable when cash and credit disappear? How much of these items is enough?

Obviously food, water, ammo, etc, but how do you protect your finances? Just scary that a person's bank account, 401k, etc. are just numbers on a computer. How much of one's net worth should be in tangible items?

 

[pudly]

What are some tips for financial prepping? Bill Bonner and his "Agora" group, among others, claim that a credit bubble burst is imminent. The scenario they describe is very similar to what happened in Argentina in the late 80's and early 90's. He claims cash on hand will be at a premium, along with other tangible items such as gold, silver, etc. So how does one prepare themselves financially for if and when the ATM's and banks are shut down and/or out of cash? What about when no more credit is available and your Visa becomes completely worthless?

The answer is simple and you listed it as part of your question. Keep a supply of cash to cover problems in the short term. Precious metals can also be part of your preps to cover some of the more extreme situations or simply as an investment/inflation hedge. These steps aren't strictly about bank problems, but can also be considered a form of savings that can cover many other emergencies. Recent world experience shows a pattern when countries financial system gets into desperate financial straights. A "bank holiday" is declared on a Friday and you are locked out of or greatly restricted on how much you can get out of your accounts. The duration can vary greatly, so there is no one agreed upon duration you need to cover.

Hardly anyone uses cash anymore, and most places give you the stink-eye when you pull out cash to pay for something instead of a credit card. What other items become valuable when cash and credit disappear? How much of these items is enough?

Stink-eye? Where do you shop? I use cash all the time and have never once had such a reaction.

Obviously food, water, ammo, etc, but how do you protect your finances? Just scary that a person's bank account, 401k, etc. are just numbers on a computer. How much of one's net worth should be in tangible items?

One basic lesson of prepping is that steps that you take to mitigate one potential problem will help you as you consider other potential problems. Storing cash in case of a financial crash? You can also consider it a form of savings. It is commonly recommended that you have at least two months of savings in case of sudden unemployment or other emergencies. So, by helping yourself and your family to cover one potential problem, you are making yourself more resilient against others. Keeping food/water on hand for SHTF situations makes you able to handle a severe ice storm or to keep your expenses down if you suddenly lose your job. This applies for pretty much all forms of prepping.

 

[spencer rifle]

It has gotten easier to hold cash, since you are not missing out on any great interest rate. Anything sufficiently liquid will pay practically nothing.

 

[BehindBlueI's]

Buy chickens. Pest control, make eggs, feathers for comfy bedding, make more chickens. Man can't go wrong with chickens.

Also, I wouldn't get real worked up over folks claiming the sky is about to fall who make a lot of money selling books about how the sky is about ready to fall.

 

[BogWalker]

If a bubble burst and we hit hyper-inflation, what good is the money in the bank anyways? Let it go and hunker down.

Not to say don't keep money around. You're far more likely to need a surgery, a new automobile transmission, or some other unknown expense than for the nation to fall apart. Money in the bank is very practical for the majority of individual emergencies which a person may meet.

 

[bwframe]

Beans, bullets and band-aids are a pretty decent financial investment when no one else has had the forethought to put some back.

How are ya'll gonna convince me of the value of your green paper or even gold/silver when you need to barter for my beans, bullets or band-aids?

 

[BogWalker]

Beans, bullets and band-aids are a pretty decent financial investment when no one else has had the forethought to put some back.

How are ya'll gonna convince me of the value of your green paper or even gold/silver when you need to barter for my beans, bullets or band-aids?

The same reasons mediums of exchange were developed by human beings in the first place. Never hurts to have silver on hand.

 

[RobbyMaQ]

Buy chickens. Pest control, make eggs, feathers for comfy bedding, make more chickens. Man can't go wrong with chickens.

Also, I wouldn't get real worked up over folks claiming the sky is about to fall who make a lot of money selling books about how the sky is about ready to fall.

So says the Leroy Jenkins fan...
"At least I got chicken"

 

[AngryRooster]

Pay off all or as much debt as you can. Cut unnecessary expenses where you can. If you hold credit cards then try to limit the balance you carry on them as much as possible. Don't get rid of them all though, that can hurt your credit report.

Keep some cash at home as well. As was mentioned, bank rates are junk right now. The only thing you are gaining by having your money in the bank is the physical security and insurance it offers over having it at home. If the banks/feds limit how much & when you can take it out then that can leave you stuck. Keep a few thousand secured at home if you can.

Silver & gold can be a hedge against inflation and a nice investment, but if things go really bad (not likely) people can't eat them. If you are planning for things like a total collapse (again, not likely) then beans, bullets, band-aids and most importantly skills will help get you through. Have or develop a marketable skill that people will want or need in that type of scenario.


And yes.....
Chickens. Fresh eggs are awesome.

 

[sdtech58]

Based on what i'm seeing here, I shouldn't be too far off then. Sitting on about 2-3 months worth of cash stashed away, as well as some more with family in a more remote area. About 1 year's worth of expenses in easily liquidated accounts. Probably need to up my precious metal inventory and the 3B's a bit with a portion of that money, but I think i'd have enough to get out of a short-term jam if necessary. As far as a skill to barter with, that may be my next step. Thanks for the feedback.

I do like fresh eggs...

 

[Leadeye]

Buy chickens. Pest control, make eggs, feathers for comfy bedding, make more chickens. Man can't go wrong with chickens.

Also, I wouldn't get real worked up over folks claiming the sky is about to fall who make a lot of money selling books about how the sky is about ready to fall.

Sound advice, guys like Howard Ruff made good money in the 70s selling books and newsletters for the catastrophe of the 80s that never happened. Knowledge is your best friend, I don't raise chickens or cultivate beans, but I do know how and have experimented to make sure I have a plan.

 

[GIJEW]

A "bank holiday" wouldn't be indefinite because economy activity would have to continue. It would last days, weeks--maybe, until all us frogs had been convinced that the temp had been turned down, and that we didn't need to freak, and jump out of the pot.

In Israel in the early-mid 1980s inflation was 400% and the gov't eventually printed the "new shekel" after repeated devaluation made the coins useless and we were buying bread with 100 lira notes. People got paid, they just immediately spent their checks on extra TVs or foreign currency, gold jewelry, etc; and everybody made a point to be late paying their bills, passing along the loss in the currency value. That trick did not work in the shuk though, where the prices on food were listed on chalk boards and updated

Until the gov't abandons the the fiat currency, it will buy something...somewhere. That said, given our currency bubble and what's going on with other central banks, I think it's crazy not to have savings outside the bank...in denominations of cash, food, ammo, and precious metals

 

[PistolBob]

Any commodity is only worth what someone else thinks its worth. I'd rather have soup beans than silver.

 

[pudly]

Soup beans are a commodity as well. How much do you need? Go ahead and store as much beans as you want and even some more for trading/helping others. If things are that desperate, you will still want things from others that they won't take beans for. That is where silver comes into play. Under most circumstances, you will be able to buy a lot of X for one silver coin, so it is a very compact and portable form of stored value. It is very durable and won't be spoiled by vermin. It is widely recognized and particularly if the normal currency is no longer trusted, will be widely accepted. It has a demonstrated history of providing value in financial emergencies such as Argentina and now Venezuela. Nothing wrong with beans, but what if you want to hold more value in your preps than what is practical in beans?

Primitive man figured out thousands of years ago that currency makes trading easier than barter. Many preppers still haven't learned that same lesson.

 

[Romero Zombie]

I've always said if the S really HTF the financial/monetary system will cease to exist. Gold and silver will become shiny metal that only people needing a boat anchor or with a jewelry making hobby will want. I wouldn't give one round of 5.56 for a bar of gold in that situation.

 

[GIJEW]

I've always said if the S really HTF the financial/monetary system will cease to exist. Gold and silver will become shiny metal that only people needing a boat anchor or with a jewelry making hobby will want. I wouldn't give one round of 5.56 for a bar of gold in that situation.

Yeah, if society ceased to exist and turned into a scene from "mad max" or "the walking dead", gold/silver etc wouldn't have any value because there wouldn't hardly be anyone to trade with and that hierarchy of needs would be on the level of hunter-gatherers. There's a lot on the SHTF spectrum to crossed before getting to that situation.
The gov't will make it's survival it's first priority. We'll all be bartering food from our gardens for spare car parts etc and carrying bags of near worthless cash to any grocery that's left, and the state will still be providing LEO protection--at least for gov't buildings and some "green zone" that they've set up for politicians to live in. Even in failed states like somalia or afghanistan (as it might be again) that devolved into warlords and their fiefdoms, precious metals had value. Suffice to say that if you have to worry about the gov't wanting to take it from you, it still has value.

To be clear, I'm not saying that precious metals are a substitute for food, ammo, and other essentials

 

[pudly]

To be clear, I'm not saying that precious metals are a substitute for food, ammo, and other essentials

^This. Feel free to get your other preps built up first. Build a support network, develop skills, store stuff, hold emergency cash. However, if you need something and don't have what the other party wants, then an recognizable and trusted form of money is valuable. Read up on the Argentina and Venezuela financial collapses and you will see that precious metals have been useful in both cases.

A good resource for preppers in general and it has some first hand experience on the value of PMs in a financial collapse: https://www.amazon.com/Modern-Survival-Manual-Surviving-Economic/dp/9870563457

 

[skulhedface]

I know Dave Ramsey isn't for everybody but...
They're live streaming their smart money event on Rachel Cruze's YouTube for free Thursday at 6:30 pm central time