If you’ve been watching current events unfold and are completely on board with the idea of a speedy recovery and then we’re back to business as usual, you need to stop reading right now. This article isn’t for you…though I’d suggest that if that is the case you have not only drunk the proverbial Kool-Aid, you’re practically drowning in it. If, on the other hand, you’ve been very uncomfortable with the direction our country has been going for years (even before the Wuhan Flu gave the Fed yet another excuse to bail out the Banksters and give the rest of us a stiff middle finger), keep reading.
There’s a whole lot of financial advice on the Internet, but very little of it is aimed at the little guy, and even less still is aimed at the average dude who doesn’t think that endless Fed manipulation and money printing is going to be a good thing for America in general and Main Street in particular. If you’re like most folks, you’re less worried about your stock market portfolio than putting food on the table. If that’s you, keep reading, because I have some good news.
There are ways that even people with extremely limited resources can invest wisely for the future right now without having a huge cash stash, and you can do it without putting your money into the Wall Street casino. Better yet, you can do most of these things with a degree of financial privacy that is truly refreshing in a world in which Jeff Zuckerberg knows more about you than your first cousin. I want to talk about some of those options, but first I think it’s important to get the basics out of the way.
You shouldn’t invest a penny until you’ve made yourself immune to a short term disruption in your stream of income. So, with that in mind, let’s review what you should do now if you haven’t done so already.
Build up a reserve fund equal to the amount of money you think you’ll need to ride out a loss of employment or other income. Many professionals recommend 3-6 months of pay. That seems like a good average, but you may need more or less depending on your skill sets and job market. Just make sure you can sleep at night if you knew that tomorrow your job was going to be gone.
Get out of (some) debt. By that I mean, any debt other than home debt if the interest on that debt is greater than 10%. I view home debt as different than consumer debt because your home is likely to keep pace with inflation, while the crap you bought with your credit card won’t. Also, most people owe more money on their homes than they’ll be able to pay within the next five years, and I think the next half decade may make or break many of us because I think the collapse is nigh upon us now. So, don’t spend money trying to pay down low-interest home loans when you could be investing for a better future. Because of this short time horizon, don’t even pay off your car loan if it’s less than 10%-we don’t have much time left, and you need to put your money to work.
Student loans are also different. I think it’s likely that there will be some forgiveness of that debt. I don’t want to get into the politics of that. I’m just making a statement. Don’t pay off a debt early that will be forgiven anyway, especially when you can use that money to make more money.
Learn a trade or start a business that will do well in a collapse. Think of the things that you cannot do without, and learn how to repair them: air conditioners, plumbing, autos, electrical, etc. Those jobs will still be around, come what may. Think of businesses that will thrive in bad times: pawn shops, auction companies, convenience stores, etc. These businesses have low barriers to entry. Get into one now, if you can.
Now I’m going to say something extremely unpopular, so get ready for it: If you can get a government job, do it. The last thing that gets cut is government fat, and it’s almost impossible to get fired from a taxpayer-funded position. In a collapse, you’ll still be collecting a paycheck, while your private sector friends will be hoping they can get unemployment benefits. Plus, you really can’t beat the pay and benefits of these .gov jobs. Again, like the student loans, this isn’t about what I like or think is right-it’s about financial survival.
Now, let’s say you’ve done all that: saved up for a rainy day, paid off stupid debts, learned a new trade. Now you’re ready to invest. What to do? Here are the answers, but it’s important to note that I think you have very little time for this. That’s why I have some high risk investment prospects listed, along with very low risk ones. I think we’re so late in the game it’s time to swing for the fences, if you have the stomach for the volatility. Here goes:
Some people will tell you to buy ammo and store food, and yes that’s a good prepper/survival strategy, but I just don’t consider these as investments (except as barter tools) and so they are beyond the scope of this article.
Budget: Under $50/month
You wouldn’t think for so little money you could start investing but it’s actually easy to do. You can buy one silver dime for less than $2, and it’s actually a great time to buy silver right now because it’s never been so cheap relative to gold. They don’t call it “poor man’s gold” for nothin’. :)) Go down to your local coin dealer, don’t divulge your name, and pay in cash. Hide it well at home. Do not put it in a bank, because the government once confiscated precious metals on a whim and they’ll do it again if they see fit. Besides, a safe deposit box costs money but you can hide your coins for free (or nearly so) at home.
You could also begin to stockpile consumer goods that could be sold at a premium in a crisis. The Covid 19 plandemic teaches us that people will be looking for toilet paper and disinfecting lotions, soaps, and wipes, and will be willing to pay a premium for them. Buy as much as you can afford to reasonably store, and sell (on E-Bay or Craigslist) when the shelves are empty at Wal Mart. If the plan never works out you can always use them for yourself.
Now I’m going to tell you to do something that goes against the grain for a lot of folks: even at this small budget, you could buy some cryptocurrency- either Bitcoin or Ethereum. This isn’t the place to talk to the merits of these as investment vehicles, but suffice it to say that I don’t know of any other way in the last 10 years that could have even come close to making a small investor so much money. If you’re a “swing for the fences” kind of person and have a strong stomach for wild fluctuations that could cause you to either lose it all or make you a bundle, this is for you.
It won’t take you long to fill up your garage with disinfectant wipes and soap so we’ll skip that at this level.
For $50-100, if you’re a conservative person, buy more “junk” silver. You can get a roll of of pre-1965 silver dimes (face value $5) for well under $100 from your local coin dealer. Quarters, halves, and silver dollars from that era are also 90% silver, and as I said earlier, as of this writing there has arguably never been a better time to buy the “Poor man’s gold”.
If you’re more of a gambler, buy some more cryptocurrency instead. If you already have some BTC and ETH, buy EOS as well.
Here you could buy 10 one-ounce American silver Eagles or a tenth of an ounce of gold. As mentioned earlier, pay in cash and hide at home.
If you’re more of a gambler, buy Cryptos (see above). Bitcoin is the one everybody watches, but some of the smaller coins like EOS might give you more leverage.
At this price point you could borrow money and make payments on some arable farm land of 5 or so acres, maybe a small parcel that in a pinch you could live on. Ideally, it would have city water/sewer, but that’s not critical. Farmland is likely to increase in value as global trade conflicts and wars cause disruptions in the food supply and urban sprawl continues apace.
You could buy a 1/4 ounce American gold Eagle.
You could add to and diversify your crypto holdings.
Now you’re looking at the possibility of 10 or more acres of arable land (with a loan, of course).
OK, yes, now I’m out of the scope of the article’s “average guy”, but I’m still not anywhere near affluent status, so here goes: if you’ve got a grand or more a month lying around, buy this:
A half ounce of gold, or a 50 ounce bar of silver (the silver is iffy at that price right now but a coin dealer might go that low if he’s needing a cash sale quickly).
You could buy enough arable farmland that a farmer might pay you rent to work it.
Now for something that isn’t as risky as cryptos but more risky than silver and gold. It’s inexpensive to open up a foreign bank account, and if you have over $10,000 a year to invest you probably should. This is important because as long as your money is in the USA it’s subject to the Draconian laws of our government and the confiscatory tentacles of the IRS. There is no place you can go where the USG can’t get to you if they want to, but you can at least make it hard on them. Open an overseas bank account, and so long as you report it annually to the IRS and have less than $1,000,000 there, they won’t bother you. You can easily use your ATM card overseas, even if a “banking holiday” (national closure) is declared in the USA. With that, along with your cash stash and crypto, you could start over in another country if you had to. And don’t worry-it’s not hard to open one up. You don’t even have to go to the country in many cases. There are several options available in the Caribbean and South and Central America, and some of them are easy to open while you’re on vacation. Now, you may be thinking, “sure, I could do that, but I don’t make any money on it.” But you can. Here’s how: many foreign banks allow you to keep your deposits in the form of other currencies. Try to find one that allows you to keep your money in Swiss Franks, Australian dollars, or Norwegian Krone. Those three currencies are a pretty good bet if the dollar goes down in value. While the dollar has been on a tear fro the last ten years, it hasn’t always been so, and given the mind-boggling levels of debt we’re adding now at a record pace, it’s a pretty good bet it’s going down for the next ten. If you’re a real Mississippi gambler, try Rubles or Yuan, if you can find a bank that holds them.
Budget: $1,000 and up/month
At this point we’re way out of the intended audience for this article, but here goes anyway. Your portfolio should look like this:
20%-arable farmland and/or an income-producing property overseas
20%-collectibles such as fine art, antique cars, and wine
20%-split between foreign currencies such as CHF and cash in USD
In conclusion, I’d say the most important thing for anyone is to get started right now. It’s not too late, but the clock’s ticking down to midnight, and the stakes are high.