I'm worrying about the future for me and my young family.
Do you have any advice for someone with dependents during this time?
I avoid personal debt like the plague. If that means living in a small house, and driving an old car, then so be it.
I've also found that learning to deliver software, as opposed to just "writing" software, has made me much more valuable.
Shipping isn't "fun," and many younger developers don't have the patience for it; but, when the rubber meets the road, shipping is what it's all about.
Going into debt that you can pay off and will make you a profit is good - because making a profit is literally the thing that gets you through bad times. (That's why having savings be 100% cash is riskier than investing - you are 100% guaranteed to not have it go up.) And recent years' zero-to-negative interest rates were the time to borrow.
But going into debt for a depreciating asset like a car is a bad idea, yes. A house is complicated, because land value likely means it's profitable, except that you can't sell it because you're living in it.
But in hard economic times, the global economy will be doing badly and therefore most investments will too, even housing (see 2008). Going into debt that you then invest is doubly risky: you have debt, plus you have a risky investment.
Saving cash is actually indeed the best way to prepare for hard times.
A the adage goes: buy low sell high. In what people equate with "good economic times," prices are high, but in hard economic times everything is on sale!
That said, firstly and foremost we should all make sure to have enough savings to ride out hard economic times—including personal ones. That is, enough to pay our monthly expenses for a year or so, in case we become unable to work or we do not want to take income from investments (because say, the market is down). How long you should be able to last is a mater of individual comfort level, but IMHO, no less than 6 months.
Too much savings in the bank however—and this I believe relates back to the point being made by the original commenter—is actually not good. That money is losing value, and therefore so are you. You should invest it somehow, but that's not the only way. Another way is taking on debt, if that debt is the sort that generates a profit. We're not talking about car loans here (unless of course your a car dealer).
Please forgive me if I misinterpreted your point, but I felt it important to make this clarification.
In sufficiently hard economic times, everything is on sale because no one has any idea what will still be around tomorrow and what is going to drop to zero.
Don't forget the other adage--Don't time the market.
> That said, firstly and foremost we should all make sure to have enough savings to ride out hard economic times—including personal ones. That is, enough to pay our monthly expenses for a year
Having a year of expenses is good practice in general. I'm not sure that qualifies one as ready for actual hard times at a societal level--not just a stint of unemployment, but global depression, accelerating price inflation, or even general European war and the rationing that could follow.
> Too much savings in the bank however—and this I believe relates back to the point being made by the original commenter—is actually not good. That money is losing value, and therefore so are you.
There are ways to save that protect you (somewhat) from inflation. Like short term bonds (ex: from treasurydirect.gov).
> Another way is taking on debt, if that debt is the sort that generates a profit. We're not talking about car loans here (unless of course your a car dealer).
Unless there is some full-proof investment scheme that you're aware of, this would essentially be gambling. If you take on debt and your profit-generating scheme fails (which is certainly possible in the "hard times" scenario that OP has envisioned), then you're worse off--you've got debt to service, on top of everything else.
> Don't forget the other adage--Don't time the market.
I did mean to to imply trying to time the market. The commenter wrote "Your advice might be okay for good times (investing, buying land, houses)." To me this says that it's OK to invest in good times but not bad. This in fact boils down t a form of attempted market timing—and the worst kind at that! Of course you should buy when times are good, but should also not stop buying when times are bad. If anything, bad times should be viewed as an opportunity. Hopefully you've prepared well to be in a position to take advantage!
> Having a year of expenses is good practice in general. I'm not sure that qualifies one as ready for actual hard times at a societal level--not just a stint of unemployment, but global depression, accelerating price inflation, or even general European war and the rationing that could follow.
I also did not intend to imply that having a years worth of expenses qualifies as preparation for "actual hard times." I was responding to the above comment, not the OP. That said, a year of expenses could be stretched for an awfully long time if needed.
> There are ways to save that protect you (somewhat) from inflation. Like short term bonds (ex: from treasurydirect.gov).
Naturally. This is an investment, which you should not avoid. We are saying the same thing. The only difference is that the commenter does not recognize debt as being good in some cases, but I would argue that not all debt is dangerous. If that were the case our economy would cease to function!
> Unless there is some full-proof investment scheme that you're aware of, this would essentially be gambling. If you take on debt and your profit-generating scheme fails (which is certainly possible in the "hard times" scenario that OP has envisioned), then you're worse off--you've got debt to service, on top of everything else.
No fool-proof scheme, and not gambling. If you have made solid investments, including those based on debt, and have given yourself enough runway to ride out hard-times (and of course this includes your debt repayments), then you should have no reason to panic or feel burdened.
Honestly, it's hard to give advice since it's so specific to the region and job market, etc.
Like many US engineers can easily afford to buy a house outright with $200k+ salaries, that isn't possible as often in Europe or Asia for example.
But basically do what you can to get fixed costs that you know you can afford and stability - i.e. a fixed rate mortgage, fixed rate utilities, and trade union membership and unemployment insurance, etc.
That's about 100K after taxes + medical (not included in taxes in the US) and other deductions.
With houses in good markets far above $1M, nobody making $100K net is buying a house outright. Or even being able to buy a house at all.
"I'll borrow some money to buy the seeds I need to plant my crops" and then the harvest goes bad and you have neither food nor money to repay the debt. Suddenly the wealthy neighbor you borrowed from is taking your land to pay for it.
If you find a bookie giving you terms like that, then you should take them.
1. Build an emergency fund. I have enough to cover about 12 months of all my expenses.
2. Avoid life style creep when you start making more money.
3. Invest pre-tax, take full advantage of 401k and IRAs (make sure your expense ratio is low in your selected funds)
4. If you need a car be reasonable, take efficiency and repair costs into consideration
5. Learn how to do basic home/car maintenance
6. Learn how to cook
The idea of emergency fund is that you are not forced to sell during hard times. It is extremely likely that total market will recover and go higher than before.
Saving cash beyond emergency fund is like setting it on fire. Every year inflation is eating it away.
Cash is the worst possible holding. Inflation will destroy it.
If you feel higher inflation is coming, holding as much debt as possible is what you want.
Of course, you do want to have enough cash on hand for short-term expenses, say like a year of living. Anything beyond that is very risky.
This is just as stupid as:
"But going into debt for a depreciating asset like a computer is a bad idea, yes."
They are both investments in potential tools. For many, an investment in a car can ultimately be cheaper than most other modes of transportation. Just like how companies finance their data centers with debt. Of course, it does not mean any car. Hell, it does not even imply a new car. But the advice of using debt to finance a car is always a bad idea is just patently false.
That's a joke, right? It's entirely dependent on one's location, and i think for more people here on HN the inverse would be true ( I'm assuming the majority of users here live in or around big cities, where tech was traditionally concentrated). In well developed big cities ( so excluding the many failures at urban design and planning in the US) public transit is at least decent, and i don't think there are any places around the world where owning a car is cheaper than paying for public transit ( with the caveat that depending on how you measure the time spent could alter that)
That's the world's biggest caveat. Investment in a modest car that stops you from spending 3 hours each way commuting over 4 separate bus routes from exurban home to exurban job is about as high a return on money as you're ever going to see. Not to mention grocery shopping kids and whatever else.
There are painfully few places in the U.S. where this isn't true. I prefer your model and I live in one of those places (Brooklyn) but let's be honest here about how the world actually works.
I know your example is exaggerated but even so making decisions about where to live and work like that is on a parallel with making poor decisions about your finances.
Also living in less desirable areas often has a lower cost of living - offsetting the cost of a car.
Except for the fact that non-terrible housing in U.S. cities comes at a premium, and in the U.S. the majority of jobs are now in the suburbs, not the cities.
That, of course, is why people do it. I wish it wasn't true, I wish things were like Switzerland where every remote mountain town still has fast and effective connections to the national transit system. But they aren't, this is America.
The example isn't exaggerated at all. Unless you happen to live on a straight bus line to work, it's going to add many hours to take a bus downtown and then out to the office.
Office locations come and go, a house is for the long haul. You're not going to sell and move houses every time you chance jobs.
Exactly. Not having a car is only a money saver if you place next to zero value on your time and what you can do with it.
If I switched to taking public transit to work, the additional childcare costs alone from the increased hours I'd be outside of the house would likely negate any savings I might have otherwise achieved.
Similarly for active transport, you get free exercise.
When I lived in SF, I had a 1.5-2hr Caltrain/bike commute to Palo Alto. Missing a train would cost me 45 min. A car getting stuck in the tracks or a suicide would cost 1-2 hours.
A car currently saves me 2hrs, enabling me to have more time to cook healthy food myself and visit the gym with cadence. Imho, a car pays me in dividends.
I could live closer to work, but it’s difficult to socialize in those areas.
With the exception of Manhattan, and some parts of D.C. and SF, no car = no job.
I'd take that bet. America is a big place and unlike Europe, our population is not concentrated in one or two major cities. There are huge numbers of tech jobs in places most people outside the U.S. have never heard of. Just as a for instance, there are over 15 cities in the U.S. larger than San Francisco, like Houston, TX or Jacksonville, FL.
I'm not going to argue about urban design, I agree the U.S. could do much better on that front. But for now, a car is an absolute necessity for the vast majority of Americans, including Americans who work in tech.
Ubers are cars, just with an extremely high markup.
I had a coworker so proud of not spending money on car. So he commuted on Uber. Over $50/day. That's over $1000/month!
This should be be on a billboard.
You could even take it a step further, ubers are worse than just owning a car. If I drive my car somewhere, I stop driving it when I get there. Ubers on the other hand, have to deadhead between different pickups and drop offs in addition to the mileage racked up during the pickups and drop offs themselves. So folks using uber are contributing more vehicle miles on a per trip basis than folks who are using their own vehicles.
Certainly not a joke. Unless you live in Manhattan, or happen to luck into a house within walking distance of your job (ignoring pandemic WFH), then in order to maintain a lucrative career you need to get to work, in time, without spending most of your day waiting for buses. That means investing in a car.
A car by itself is of course a terrible non-investment. But if it brings home that high salary, it becomes an investment.
>But going into debt for a depreciating asset like a car is a bad idea, yes.
It's important to not go into debt for frivoulous consumption. If you buy an old car, it actually doesn't depreciate very much as long as it's kept in working order. The same with a computer, if I go into debt to get the new M1 Max because I need a computer to code, that's not very smart.
I can code just fine on a $300 used ThinkPad, and I can travel just fine on a $4000 used car.
If I'm unfortunate enough to really need either of those for income geneartion but can't afford it, then it makes sense to borrow for it, but only to get the minimum you need to get the work done.
Of course it's much more fun to get a newish F150 and the latest Apple gadget on a 96 month loan...
Many assets that are incredibly productive depreciate. If you're making a living as a house painter you definitely want to invest in paint brushes rather than smearing the paint all over the walls with your hands. The fact that the brushes wear out pretty quickly is irrelevant. Same goes for an auto mechanic buying sets of wrenches, and possibly the developer getting a much faster computer that increases their productivity.
Fact is that owning a reliable car is a prerequisite to many jobs and living situations.
The advice is usually given around consumption type "assets". Like don't go into debt to buy a jetski or golf clubs or something. It's a mistake to transfer that logic to productive assets.
I agree though, you’d take a loan to buy eg a CNC mill, and you’d expect it to depreciate. On the other hand, you could buy a CNC mill second hand and avoid the large initial depreciation.
Staying debt free is the only safe place, you have flexibility.
And the advice to treat dept like a disease is worth following. There is no better feeling than telling the car sales failure you want $5K off because you're paying in cash, with a spreadsheet identifying that's their take from the financing you are not using.
Also learn to cook. Cooking is infinitely cheaper than eating out.
There are a lot of comments about streaming services, which is similar to "make your own coffee." You can cut all that out of your budget at the drop of a hat. It's not particularly important as long as your saving margins are significant.
If you really planned well, getting laid off due to market conditions can be a blessing. I've allowed myself a 3 month sabbatical before and it was amazing. My costs were higher than I wanted them to be, so I started to stress (unnecessarily really) toward the end. I'm in a much better position now though.
Edit: Health insurance w/ COBRA is the biggest cost. I wish the ACA would apply to recently unemployed people and apply the subsidized zero income rate temporarily, at least for catastrophic events.
Not the best choice if denominated in a currency that loses its purchasing power by 8% annually and whose supply is managed by the people who called the 2007 housing market as "a little frothy", the 2021 inflation as "transitory", and habitually gives in to the crack addict tantrums and demands of the market for easy money if they even hint at tapering asset purchases. These people are somewhere on the spectrum from totally incompetent to actively malicious, and trusting them to steward the value of your cash savings is pants-on-head idiocy.
Identify any and all durables and non-perishables that you know for a fact you'll use in the future. Convert your fiat into those goods as fast as you possibly can. Appliances, canned food, dry rice/beans/wheat, toothpaste, keyboards, printer toner cartridges, whatever it is you use regularly, buy it now.
If you have variable-rate debt, pay it down. Pay it down now. The next rate adjustment is going to murder you.
You can also somewhat mitigate the collapse in purchasing power by converting your worthless currency into precious or base industrial metal ETFs, or globally-diversified equities. Just bear in mind that the government will steal 15-30% of your realized "gains" (which are not actually gains, just standing still in terms of purchasing power). Your half of a grass-fed cow in the freezer and 800lbs of Jasmine Rice will be taxed at precisely 0% when you eat it.
Or you can buy TIPS or other inflation-indexed securities and gamble and pray that the bullshit PCE/CPI deflator they pull out of their ass and dramatically lowballs cost-of-living increases we actually experience doesn't put you too deep into negative real yields.
There's no real winning when both your currency and your fiscal policy is managed by sociopaths, but we can still try to mitigate the damage by escaping the currency.
With more nuance it makes sense - avoid bad debt for lifestyle that doesn't produce future economic value, and avoid an excess of investment debt but carry enough investment debt in well considered assets that you can be part of our economic systems growth which is built into our society by design and enforced by our government systems.
Let me tell you, as one of the highest performing team members in every organization I’ve been at: if a manager doesn’t care about you, no amount of performance will help you. It didn’t help me.
And whether a manager cares about you is mostly luck of the draw. Sure, there’s politics at play. But the most common situation is that you’re not really helpful to their career mobility.
In that situation, “learn to ship software” is the opposite of helpful. If your manager doesn’t have your back, and you can sense this, you need to look for a new job. Because I guarantee you’ll be the first to go. It all comes down to whether some dude in a proverbial suit likes you.
(Isn’t it interesting how it’s always some dude? I feel like women would be better suited to actually caring about team members.)
You should at least mention to those young devs that performance is one of the least important aspects of being a part of a team, for 97% of companies. It’s table stakes. Raising the stakes won’t help you if you can’t play the game.
As for preparing for hard economic times, my advice is pretty simple. Exploit the good times, and never assume it will last. If you can’t survive losing your income for three months, make changes. That’s pretty much it.
I agree with the other comment that performance is a necessary but not sufficient condition.
You build your own brand. A good manager helps with that. A poor manager takes the credit and you aren't acknowledged.
I've had the funny situation for the last few years of my manager, being the CEO, doesn't like me personally. Most of my managers have, and the issue kind of come down to a culture clash where he's a salesperson and I'm an engineer, and I wouldn't put up with a habit of his of not paying his invoices on time which he's thankfully grown out of.
However he's seen that I deliver at the highest level, and he so he pragmatically keeps sending me projects so he can take his clip (it's a consultancy). This has continued for well over two years and even reached a steady state where I'm pretty sure it could be ongoing if I wanted, however the cost is he's pretty mercenary about it all and has consistently given me rescue projects others have left half finished.
So I basically agree with what you're saying, I think it's true generally. However reality is very complex with lots of individual situations that are out of ordinary.
In income terms, diversify away from a single source by learning new skills, training up in areas you're a bit rusty in, learning totally new ones.
In savings or investments: diversify where you put them, spread them around so you're not dependent on any one scenario.
In eating: eat more interesting and cheaper things. Become vegetarian, if you aren't already.
In exercise: drop any gym memberships, use things like body weight to train. Run one day, do yoga the next.
In your media consumption: diversify in sources but don't take this as a cue to read more. Read less, much less, but read better. Ignore social media, it's all b&&&&&t. Find one or two sources of media that are reasonably middle line, and read around a topic in a diverse way. Don't get sucked in to anything, least of all the disaster scenario stuff you'll find.
Last but most important: spend all the time you possibly can with your family. Make them your focus, not your income and "future". Be in the now as much as you possibly can. You'll only have this time with your (small) kids for a very, very short period. They'll be flying off soon. Be there for them.
Best of luck.
A laudable goal in terms of sustainability and health, but in most developed countries not a cost saving measure. Meat is way too cheap, and often forms part of the bargains supermarkets use to attract customers.
In the long term and the most pessimistic scenarios doing without meat may be cheaper though.
1kg carrots - 39p https://groceries.morrisons.com/products/morrisons-carrots-2...
2.5kg potatoes - £1 https://groceries.morrisons.com/products/morrisons-white-pot...
And so on. Vegetables are cheap. It's frustrating seeing people complain about food but not learn to cook. Making casserole is cheap.
You can make delicious, quick and easy food both with meat and with vegetables. If you try and cook a steak like vegetables, you will have poor results. If you try and cook vegetables like a steak, you will have poor results. If you treat each ingredient - meat, vegetable, or otherwise - in its own right and cook/season appropriately, then you can and will make excellent food.
I pay several times more for my phone+internet per year than for my healthcare (and I have 2 separate chronic conditions)
What you don't pay for out of pocket, you do pay either in quality of care or through your taxes, one way or the other.
Human beings have thrived eating meat for hundreds of thousands of years. And it's a lot harder to completely address all the nutritional requirements on a purely vegetarian diet, but not impossible.
Here are videos exploring studies about meat, which convinced me.
How is meat produced, if not agriculture?
In any case, agriculture barely employs anyone nowadays, with mechanization and animal factory-farms.
Where I live, this is no longer true; on the one side there was a big outrage at the super cheap meat (€3 / kilo at the lowest), pushing shops to sell meat at a higher price (and presumably better animal conditions, but I'm not convinced this is independently verified), on the other there's these certifications farmers can get for their animals' living conditions, and people are willing to pay extra for this.
Anyway, in our household, freezer vegetables are a staple. We tried fresh vegetables for a while, but there's a lot of stems (in e.g. broccoli) and it's not as fresh or affordable as the frozen stuff.
That said, I think that instead of raising the price of meat, they should lower the price, availability and diversity of vegetables.
I would also encourage people to avoid these "vegetarian meat alternatives"; they're kinda scammy in that the ingredients are cheap but they sell it at meat prices. It's a lazy vegetarian's option. If you want to avoid meat for whichever reason, learn to make meals without something that kinda looks like meat.
This is very healthy. But make sure to take B12 if you're going vegetarian.
> Though deficiency for those starting out with adequate stores may take years to develop, the results of B12 deficiency can be devastating, with cases reported of paralysis, psychosis, blindness, and even death.
https://nutritionfacts.org/topics/vitamin-b12/
Edit: To the downvoters, care to explain?
Best is not to generalise and instead get a blood test to check vitamin levels. Talk to your GP.
Personally, I avoid fortified foods because I supplement with higher quality forms elsewhere. Neon yellow urine is not right.
For instance, a local butcher shop might offer local products, and will be more expensive. But you can offset the expense by only having meat dishes on, say, Sunday. That's just one strategy. Another is to use the left-overs in a next meal.
Historically, meat was expensive, and not eaten daily. For intsance, in the UK, "sunday roast" was originally exactly that: a meal that was only eaten on Sunday after service. Sheppard's pie was then a dish made from the left-overs.
https://en.wikipedia.org/wiki/Sunday_roast
There's more to it then that, but it's a good idea to be aware that historic eating habits do yield many good ideas on how to move away from modern day meat consumption patterns predicated by the abundance cheap meat.
We reap what we sow. We’re killing Earth’s biosphere, and soon enough our own species will face its doom.
But hey, let’s get another bucket of chicken and keep stuffing our faces with hamburgers.
One semi-major home repair completely overtakes any savings on food, of course.
I went fully carnivore and it lead to various health improvements. While I moved away from it due to my foodie tendencies, I currently do consume mainly animal products.
I plan on doing a vegan experiment as well, but I am just not getting convinced by the vegans I listen to, so I need to do more research. As it stands, I believe eating meat that grew naturally (e.g grass fed beef as compared factory farming) is more healthy and sustainable than veganism.
Where will you publish the study?
People should check what's good for them instead of blindly following information they got by osmosis. Especially with regards to health.
If you'd like to discuss any problems with widespread vegetarianism in India, which again, includes hundreds of millions of people, then I'm happy to continue this discussion.
This is general information.
We appear to have come to the same conclusion, so I'll leave it at that. Best of luck out there.
Try keto diet, or maybe even carnivore. Save yourself first, and then look up into saving the planet.
My bad. Then my answer is don't save by eating bad food. It will limit you more compared to the extra cash you'll save (unless you're poor and you have no choice).
Plant-based meals require far fewer resources and is cheaper, which means maintaining societal stability when resources are becoming low - as there is more to go around.
A lot of farm land is being used to grow foods for livestock. We could use that land to grow food for ourselves.
I'd generally go for keto since that is more studied compared to strict carnivore.
> Plant-based meals require far fewer resources and is cheaper, which means maintaining societal stability when resources are becoming low - as there is more to go around.
But your health will (probably/maybe) be worse. There are ways to make cheap keto (ex: eating 10 eggs/day in my local area).
> A lot of farm land is being used to grow foods for livestock. We could use that land to grow food for ourselves.
Then eat grass-fed meat. I do so myself.
I'm not sure there is enough grassland in the world for everyone to eat grass-fed meat.
that you should do keto or carnivore. Feel free to read or believe the vegan doctors or the keto/carnivore ones. But I've made my choice and I ~mostly have been right in my life, including this. Feel free to become a psychiatrist/psychologist/sports-science and do your studies and bring a better way.
Until then, eat keto/carnivore with the best red meat you can afford. And then worry about the world. And humans are smart enough to fix this particular issue.
In economic hard times, one mist be picky and learn how to eat anything available.
I'm in a situation getting similar to this Ask HN... I have a family that depends on my income (plus, it's very stable/secure, enjoyable, but unfortunately under market pay). If I find a better job, and things don't work out, we'd have virtually no household income... However, I was able to find a second job (which required honing one additional skill) to pull in $3000/year working a few nights a year... Which helps pay for unexpected expenses.
This is a bit like the avocado toast nonsense though - a gym membership costs about $50 a month which is nothing compared to the near $2000 mortgage payments.
E.g. in SF, you'll pay $3500+ for housing, and salaries are largely adjusted for that level of expense. But your savings are "future money", and you can choose where to spend that. Saving $300 a month, $4k a year, can add up to sums that are significant in a lower cost of living area.
Retrospect is 20/20... (I'm making the assumption you have had young kids and are speaking from experience). I have spent loads of time with my kids in the last few years (more than many of my peers have) and at times think it has been to mine and (by association) their detriment. "all the time you possibly can" is just too emphatic-an aspiration to be realistic in the messy context of real life.
Regrets on some scale are inevitable so learning to accept them is important.
Balance is all.
Ask HN: What tips do you have for weathering a recession? - https://news.ycombinator.com/item?id=15798401 - Nov 2017 (104 comments)
Ask HN: How are you preparing yourself for a recession? - https://news.ycombinator.com/item?id=22527383 - Mar 2020 (148 comments)
But that's me / selfish, imagine being Ukranian and having to leave the country. I hope they saw it coming and prepared accordingly.
I wouldn't worry too much about it. A recession is not even close to the worst thing that can happen to you (both as an individual and as a family). It's not cancer, divorce or a horrific car accident. The only reason they're noteworthy is because they affect so many people at the same time.
Worst case scenario, you lose your job for a year or so and your portfolio gets fucked, but you'll survive and your children probably won't even look back at it that negatively (I know I didn't when my old man lost his job).
Keep it simple: do things that let you accumulate cash, so if you lose your job you won't also immediately get kicked out of your house and you'll have reserves to draw on. Consider that you might need to re-train etc.
Just build your savings. Don't do risky things that add to the complexity and your stress levels. Avoid crypto in particular.
I also have a family and I've been building cash.
Also: ignore people who tell you cash is bad because of inflation. Inflation is an effect that's known. Risks of various investments are combinations of "can be known" and "unknowable". Cash is king!
Gold certainly hasn't tracked inflation
Yeah there's risk in investing too, we all know that as well, but what level of risk is it that you should really afraid of? should I be afraid of investing in 3M, coca cola or how about a brand-new psychedelics/cannabis stock? Yeah probably for the latter, but you can even manage risk associated to that.
One risk we all don't like to think about is that our employers will let us go and we'll be out on the streets.
My point is, you can know your risks, understand and manage them. Watch your assets column so that something you think is an asset doesn't turn into a liability(something that doesn't generate profit), you want to be able to rely on a lot of factors for wealth generation because a wide array or complex risk can actually be better than single points of failure like trusting you will have / be able to find a job, that that crypto you put your life savings in won't be rug pulled, that the stock market won't crash.
Last piece of advice is to know what you can live on, if I lost my job today, what would be left in my assets column and how long a run way would I have if I could rely on my saving and the rest of my assets.
Make sure to have a small cash reserve so that you can manage for a while even if something devastating happens. Make sure to have a small stockpile of food at home so that you can make those money last longer. As a bonus, this will also count as basic prepping, and you'll be able to handle things like being snowed in for a week without too much problems (assuming you live where such a thing is possible).
Also cut down on non-mortage debt if possible, and make sure things like streaming subscriptions can be cancelled at a minute's notice; If you end up losing part or a lot of your income then you don't want to be stuck paying for things you don't really need (Spotify, Netflix etc).
I'm not looking to invest, I just want to make sure I provide food and shelter for my wife and child.
Good idea to have a plan to rapidly reduce spending. I think I'll see what I can cut now. There are things I host that can be cancelled. No more VPS to host a personal email server I hardly use.
What is your threat model?
Is it losing your savings to inflation? Having it taken away by a corrupt government?
Is it an invasion of the Russians?
Is it losing your job? Or the downfall of society to the point where nobody needs a programmer anymore?
Most people have a job in bad times. The real problem is your wages won't keep pace with inflation so you have to be careful.
Pay off debts now. Get an emergency cash fund going. Max out your retirement savings (so you can afford to save nothing if needed).
Last, but most important: you don't know what is coming. Enjoy life as best you can now.
If you expect inflation to keep increasing, then one of the financially smart things to do would be to take as much debt as possible and purchase hard assets with the debt (such as land or commodities).
For me personally, I wouldn't follow this advise because I don't like the psychological burden of being indebted. I just wanted to highlight how higher inflation expectations disrupts traditional saving advice. It nullifies the idea of hoarding lots of cash.
I don't know why they don't constantly predict deflationary spirals instead, which are even worse, but it's probably childhood memories of the 70s.
If you know for sure inflation will be through the roof, but you will keep your job: then taking on more debt at a fixed low rate now, and investing in something that grows is the right thing. However this is risky. I can tell you what investments would have worked in the past, but it isn't hard to find historical advice that turned out bad. As such I would never recommend taking on more debt to invest even though the math seems to work. Though not paying off the house and instead investing in something else might be good advice.
Note that when those who retire early are surveyed most paid off the house early. Even though they know the math says index funds are a better investment, the peace of mind from not having dept is something they all say is important. In short the best financial advice isn't always the advice that works in practice. YMMV
I dont believe we will see a crash.
Stocks might go sideways for quit a while.
But companies will keep chugging along and employ people.
Companies which will do well, are companies, telling people the world will end...
Nasdaq-100 is down 21.33% in 7 weeks. According to wikipedia a stock market crash is a decline "of over 10% in a stock market index over a period of several days".
DAX declined even sharper (-16.5% in 12 days; -24% from recent highs).
Just as a heads up: this is similar to the 1990's where Iraq invaded Kuwait. The Dow Jones Industrial Average dropped 18% in three months, from 2,911.63 on July 3 to 2,381.99 on October 16,1990. This recession lasted approximately 8 months. This recession is listed as a "stock market crash" on wikipedia. [1]
IMO when something loses 1/5th of its value in such a short time it could be considered a crash.
[1] https://en.wikipedia.org/wiki/Category:Stock_market_crashes "Early 1990s recession"
Today we can update any index you might be interested in, in a few milliseconds. (I'm sure there are high frequency traders reading this who can give more accurate timings)
How would you scale down your expenses (if at all?) if your real income decreased by 10 %? What about 50 %? How long could you survive if you end up with no income? What consumption can you reduce, and what can you cut out entirely? When will you start cutting some things out? How much longer will that make any savings last?
Similarly, how would you scale up the household income if your expenses increased? At what rate can you withdraw from any savings?
A secondary benefit of this exercise is that it lets you find the pain points and see if you can do something now to limit their consequences later. (Is there e.g. preventative maintenance you can do on a car or your teeth that would avoid a more expensive breakdown later?)
----
In contrast to many others, I don't place such a high value on having an exact day-to-day budget. Generally, both expenses and income follow a fairly statistically stable pattern, i.e. it averages out.
You do want to know what the averages are, of course, but you don't need to meticulously track daily expenses and income to learn that -- it's enough to go back in history and sample, say, every sixth day. Much less work for basically all the same benefits.
https://ukpersonal.finance/flowchart/
The essence is to have a budget. Understand exactly how much you spend and where you spend it. Once that's done, you can work out where (if anywhere) you can save money. It might be as simple as cutting out Netflix, or as complicated as refinancing all your debt.
You can't just "pay everything off", and so the above chart prioritizes things which have highest interest, as pay down aggressively first.
You wouldn't ask 4Chan about white collar workplace social norms.
When it comes to making ends meet most of HN lives on easy mode. If your situation is anything other than easy mode then the usefulness of anything anyone here has to say will approach zero. You don't know what you don't know. This means that even when someone is an outlier and has great advice on a topic in which you wouldn't expect is you won't be able to identify it.
So hedge your bets by asking your questions in communities that have relevant experience in the topic.
I don't even lock my door. If I left money on the side walk someone walking by would put it in my mail box, or even drop it off.
When you have a strong community everything will be okay.
I also have all the traditional planning. Food, gear ect. Don't be the guy who does his hunting at the supermarket, grow your own vege section.
But you can not do everything yourself a strong community is the most important thing.
We are tech workers most of us can work remotely, which really opens up the options of were we can live.
Long term find a wife with the same ideals and get some land to call yours, where the swings of government and media opinions can not affect you.
- Electrician U: https://m.youtube.com/channel/UCB3jUEyCLRbCw7QED0vnXYg
- Home RenoVision DIY: https://m.youtube.com/channel/UCnorhjQR4zJkT7AVNhu395Q
I happily DIY things, but for the joy of self sufficiency.
USA software engineer bias: At several 100k raises possible (which you receive every year going forward), even 50k one time savings are drops in the bucket over the course of a career.
I found the hourly rate of tradesmen to be comparable to software engineer rates ($150-$200 per hour). But because I work on salary, one hour or my time does not directly increase my cash flow. Also, I’m senior enough in my career that effort alone does not equate to salary increase.
Your mileage may vary of course.
1. Depth vs breadth of skills: You could double down and become the most efficient software engineer, giving you great depth of skills and you could just pay people to do things for you. This leads to a boring life and a flat personality in my opinion. I know too many people who just know how to do one thing well. They are very boring to talk to, don't have many original thoughts, and just annoy me to be honest.
2. Control over your environment: It is a great feeling knowing you are the master of your environment and not beholden to anyone to get things done. Knowing I have control of my environment is a great mental relief and frees my mind to think how things should be done in a fun engineering mindset.
3. General understanding on how things work. I am a polymath and want to know how everything works. By DIYing you need to understand the fundamentals of how a lot of different things work to come up with a solution to problems. It's a good mental exercise.
4. Exercise: I have yet to find a better workout than manually digging foundations or chopping down trees for firewood. Most importantly, it get you away from your computer.
re 4/ Manually digging or chopping down trees has a high body tax. Non-symmetrical high impact motions are terrible for your body. Plus there is risk in falling in a whole or a tree landing on you. IMHO, low impact cardio (e.g. walking) or weight training with slow controlled movements at medium weight offers a safer alternative to manual labor.
If DIY makes you happy, then sure. But purely from a logical standpoint, its not efficient.
> Fixing my deck and expanding it: contractor wanted $55k, I did it for $7k
> Leaky pipe in ceiling: plumber wanted $1k, I fixed it for $25.
How did you learn to do these things? There are many chances where things could go horribly wrong.
The consequence of this is to prioritise a long mortgage over total repayments and to not necessarily pay off as much as possible, even keeping money back for day to day spending, assuming that's budgeted properly. Obviously there is a trade off; the smaller you can get your mortgage the more flexibility you have around adjusting repayments to help with living costs.
The long term view of inflation also suggests it might be better to hold more debt to ease things now. Though obviously that depends on how your wages might change in the longer run.
1. Move into government work just prior to periods of economic downturn - making the standards and requirements that will be needed in the future.
2. Move into private sector work during parts of economic upturn where you could take advantage of all the stuff you had a hand in during step 1.
However not sure if world situation will translate to problems for tech industry.
1. significantly more vacation.
2. I often worked 5-6 hour days (because I was done) and just went home with no one complaining.
3. much better pension.
So I sort of think it was actually about the same in value, except of course money is more liquid and thus more valuable than perks, but perhaps the great difference in value people see is partially illusory.
on edit: not sure what the difference would be nowadays as I consult and earn about 5-6 times per hour what I was earning back then.
0. Empower and partner with your spouse to make all the financial decisions. They should know absolutely everything. You can’t do it alone.
1. Zero debt. For a while I had house mortgage that I repaid at the first possible availability of bulk cash.
2. Max out tax saving investments. Try not to pay one penny more tax than absolute minimum.
3. Max out life insurance you can afford. Don’t combine life insurance with investment.
4. Buy good health insurance over and above employer provided.
5. Monthly investment in equity index fund.
6. Only when you are done with all the above spend whatever remains on your monthly expenses.
7. Don’t postpone making of a will.
Why not combine them?
Would disagree with zero debt being so high up in priority. Not all debt is equal. It's typically not worth it to pay debt back early if under ~3% interest rate.
Credit card debt? Yes as soon as possible. Student loans or a mortgage around 2%-3% interest rate? You're better off investing that money to make 5%-8% on it
Assuming you’re in the U.S. or similar you don’t need a farm, a shotgun, and a Honda full of silver ingots.
Diversify your savings, avoid consumer debt, and be wary of new monthly payments.
Consider changing to more stable job if appropriate.
That should do it.
On the roads it was a white line nightmare. Only those mobile enough to scavenge, brutal enough to pillage would survive. The gangs took over the highways, ready to wage war for a tank of juice. And in this maelstrom of decay, ordinary men were battered and smashed.
Except for one regular HN reader armed with an AK-47, a farm, and a bag full of potatoes.
Prepare for failure of government/war? Go be a "prepper" - Ie. have a few months worth of food and water stored. (not that hard in tins/pasta/rice). Get small solar panels for phone charging and a gas/wood camping stove. Download wikipedia.
In both cases, prepare to move countries. Often it's better to just leave than try to survive in subpar conditions. Beware that millions of others may be trying to do the same, and lots of governments don't like millions of refugees. Get yourself a passport for another country and you'll be far more likely to be let in.
Can't do that? Then don't bother, nobody can predict the future. Any advice you might receive here could backfire as much as it can pay off.
- one house or a piece of land can lose value depending on local conditions or be hard to sell when you could need cash.
- debt can go either way, maybe inflation makes going into debt right now a good idea, or maybe you won't be able to afford in the future and the investment does not pay off.
- savings means basically losing money right now. Will this trend hold? Who knows.
Like others have said, that’s aside from the point. You are more likely to lose than gain by timing the market. That’s what the GP is getting at.
Or in 2018 when a trade war between china and US was just around the corner?
Or in 2016 when Brexit was the fall of the EU and Trump just got elected?
There's always something, and it's never clear that that something is going to actually be the real deal.
If tensions rise we could see China and the west getting less friendly. I live in the bottom of the Pacific and we rely heavily on Chinese trade.
They only thing that really counts in the end is that you, personally, have enough revenue to cover your expenditures. If not, increase the former and decrease the latter until you do. You may need to adjust your expectations too.
Looking at one of the best biotech hedge funds, YoY% is -5% (March 2021-March 2022).
These don't qualify as a major gain in my book.
The gains materialize when the end of the world that everyone expected yesterday eventually fails to materialize.
It's precisely when no one (i.e mainstream media) is expecting, things go south. E.g 2008
However, ppl predicting crash will be right eventually because boom-bust happens in cycles. We just don't know when. Even a broken clock shows the right time twice a day.
Look - I have small kids too, so I'm not advocating that you ignore it. Everyone with dependents should be proactive in considering how they are supported (in "good" economic times too). There are just so many interconnected pieces of a global economy that a wide brush of doom is far from inevitable.
The first question I would consider: What is the funding source of the company that I work for? Are we public and thus directly dependent on market swings? Or are we VC or private-backed, which is indirectly affected but could also weather the storm if forward-thinking? Or are we private + bootstrapped, which is generally a good thing until your customers start fearing the doom-and-gloom economy too.
In mine (UK) one the biggest outgoing costs is energy, mainly heating. There are various government schemes to help people with recent bills and ways of reducing energy consumption.
I haven't checked the statistics but here in Portugal at least for me the biggest outgoing costs are rents (by a large margin), followed by food. Gas prices and car maintenance costs are also high, whereas public transport is roughly on a par with monthly energy costs.
Are people in the UK all heating their homes with electricity?
Mortgage/rent, highly variable depending on where you live, house big enough etc and if a mortgage, how many years are you able to spread it over.
Most UK homes are heated by gas. My recent bill went up 50% to £1500/y. Is expected to increase by 50% again this year.
Gas is also one of the main sources of electricity generation here.
Energy has by far outstripped inflation here over the past year.
Gas heating is common in the UK but a) it's being phased out for eco reasons b) gas has increased in price as well
Now might not be the best time to work in a startup that sells discretionary goods/services.
If you've got a solid job in an industry not too vulnerable to supply chain shocks or high interest rates you should weather the next downturn, as long as your expenditure is under control.
Likewise, durables can be hoarded before price hikes hit. Try to figure out all the incidental <$100 things you'll need for a few years. Invest in containers and shelving for them so that they aren't lost in a pile, but have a proper space where they can be put. Just having some cardboard or cafeteria trays around can be enough.
Regarding the financial investments, the model I would use for crises is migration. When people move their money around and put it in different assets, train for careers, etc they are migrating from one "place" to another to avoid impending disaster, just as people migrate seasonally to go where the food and good weather is. If you get this simple call of "stay or go" right, you avoid the majority of the impact from economic crises, and can even come out ahead.
For me, I've set crypto as the place, and privacy coins as a large part of the allocation. It's probably not the place for everyone, and I respect the people going with cash, but it's a call made specifically on the premise of migrating to something that governments have little influence over, since, as you've probably noticed, they're doing all sorts of things that upend investments lately. And if I got the call wrong, they'll ban it and render my assets illiquid, but I'm relying on a game theoretic analysis that says that some countries will embrace it in order to get ahead of those that ban it, and therefore I'll have a way out to fiat when I need it.
Now is probably not the time to quit your job to work on that startup that you've always dreamed about. But that's more about your family situation. I have young children and I wouldn't quit my job even in good times.
"see a good opportunity:" Perhaps a career move shows up that's "defense" related?
"clear risk for your family:" Maybe if you live near the Russian boarder consider moving.
"Mostly keep doing what you've always been doing:" Maybe avoid traveling to certain areas. Assuming you've always been responsibly saving, keep doing that. Investing is a good way to beat inflation.
The worst thing you can do is panic. That's when bad decisions are made.
Also be ready to evacuate from the city when time will come. Move early, roads will be stuck very quickly. Keep your car tanks full, keep few cans of gasoline as well.
It is a mistake, gold is the only safe bet
Btw it is estimated that the last time gold was declared illegal, only about 5% of gold owners gave it up.
I mean it's happened to Russian oligarchs, but those were investments that they didn't even live in. It's happened to Palestinians, who live under an apartheid regime. But other than that, I can't recall anything like that happening. WW2 Europe maybe, for specific demographics.
Actually, have you tried figuring out WHFIT taxes on $GLD? I ended up invested in it once and had no clue how you do it.
It might help if things don’t go too pear shaped, but this kind of event (a foreign invasion by a military with no regards for civilians) is basically game over regardless of your situation. The best outcome is you survive and rebuild.
Despite the madness the only thing I learn about looting from Ukraine is:
- civilian would-be looters still getting punished
- Russian soldiers are looting
i.e. when your rations expired you get desperate and since the Russian army is armed and know they are an utter disgrace anyway this happens.
It’s been 20 days. I’d refrain from being overly optimistic just now. More likely than a full civilisation collapse is a return to feudal tribalism as in Afghanistan and Lybia, which is not very good either.
However costly things can be worth it, it depends on your situation and preferences. But don't underestimate the time involved in learning broad ranged skills to look after a house, land, food production, repairs, survival skills, prepping etc which op is talking about.
Budgets are great, if you have steady income. If not, you have to think heuristically rather than algorithmically - how much of my current bank balance has to go to fixed costs like mortgage or rent, food, etc? If the answer is less than 100%, you're already doing better than a lot of people.
Learn to do as much as possible yourself - cook as many meals at home as you can, do your own repairs, make things you need instead of buying them. Invest in tools, because unlike stocks or (God help us) crypto, tools are actually useful in and of themselves. Go find a copy of the old Reader's Digest big yellow DIY home repair manual at a thrift store and keep it.
My rule is, never buy anything new you can get used, never buy anything used you can get for free, never buy anything period you can make, never make anything you can recycle from stuff you already have.
Learn what utilities actually cost in practical terms - how much does it cost to run my AC/heater for an hour? Cook a casserole in the oven? Leave a light on overnight? You'll find yourself actually considering how you use them a lot more. That might sound like Sad grumbling about the heat being turned up above 75°, and maybe it is, but maybe Dad had a point.
The hardest thing to grasp, if you're currently doing well, is how you get locked into survival mode when you're broke. You have to learn how to deal with that, and a lot of people can't. If hard times come, all you will think about is today, and the coming week, and the coming month. There are people who are able to, say, work a low-paying gig 40 hours a week and come home and work on side hustles and entrepreneurial projects - Stephen King working as a teacher and in a laundry and coming home and writing at a tiny desk in his own laundry room. If you're one of those people, you are very fortunate. But the likelihood is that, if you do find yourself in tight financial straits, you will spend your spare time just decompressing from whatever you're doing to try to survive.
Hard times are easier to bear if you've learned to be more self-sufficient and make do without luxuries and do more with less. You've seen that meme from It's Always Sunny In Philadelphia about "old poor" vs "new poor"? That's the difference. New poor is constantly shocked by how hard everything suddenly is, even the things that used to be simple. (A Costco card is not very useful if you live in the middle of the city and can't afford a car, for example. You ain't hauling a year's supply of toilet paper home on a bus.)
Old poor knows all this and is not surprised by how much shit the world can throw at you. Old poor knows that the AA folks have the right idea: you need to accept the things you can't do anything about right now, do what you can about the things you can, and know the goddamn difference.
So really, all of this comes down to reframing your strategies for making it from one paycheck to the next, and adjusting your expectations accordingly.
Also, ditch the streaming services and learn to love The Pirate Bay, and I say that as someone who's made much of his living for most of his life off of creating media. :-D Especially if you've got kids - being able to summon Frozen or Encanto on command even if you can't pay the broadband bill until next week is parental magic. Or so I'm told - I never had kids because I grew up like this and I didn't want to make someone else suffer if they don't have to.
Good luck, man, and if you're doing well now, don't ever forget to be thankful for it. It really comes down to luck most of the time, despite what the nerds will tell you. Being smart and working hard isn't enough, or half the undocumented dudes I've ever known working in the orchards and fields would be living like Kardashians, and all the trustafarians whose parents bootstrapped their crappy useless startup and let them live in the guesthouse rent-free would be standing by the freeway on-ramp with signs that read WILL CREATE INNOVATION IN THE LUXURY TRAVEL SECTOR FOR BEER AND A WARM BED.
I'll try to remember this in particular: > My rule is, never buy anything new you can get used, never buy anything used you can get for free, never buy anything period you can make, never make anything you can recycle from stuff you already have.
If you’re really truly convinced of an impending recession the best thing you could do would be to take out massive short positions. However, I suspect that you’re not so convinced.
Beyond that I’d suggest just living a life within your means. Calculate your bare cost of living expenses and save up a six month emergency fund. If you’re seriously concerned then go for a 12 month emergency fund.
Saving and having an emergency fund are crucial, in any time period, but especially during uncertain periods such as we're starting to see now. Make an honest list of your actual expenses of the last few months and question wether each one is worth it. House, car, Starbucks, gym, takeout, ... where can you save meaningfully?
If you've already saved some money, consider spreading it. Different accounts at different banks. ETF's with broad exposure and large capitalisation. Perhaps a little bit in alternative sources of value like gold or crypto, in case financial markets become unstable.
If it really goes to shit: oats are a cheap food with good caloric value. Easy to store for a long period of time. Actually look at the prices of the things you buy and compare it to the value of oats. That ~5$ latte at Starbucks could keep my family fed for a week on cheap oats from Costco [1]
[0] https://www.bogleheads.org/wiki/Bogleheads®_investment_philo...
[1] https://everydaythrifty.com/grocery-store-price-comparison/ 5$ * 0.06$/oz = 83 oz = 5.1 lb.
For this you have to ditch the idea of signalling your wealth to your friends and colleagues and, instead, be content to be seen as poorer than you are. Perhaps you don't buy a new car (ever). I'm still driving the car I bought in ~2010. Perhaps you live in an ugly/old building.
You also have to be willing to continually trim spending to exactly what you value. For example, I personally value eating food made with high quality ingredients, so I'm willing to spend more on these ingredients, but this also means I need to spend less elsewhere so I stopped going to bars and cut down on my eating out.
The upside of this approach is being able to do the things I really value while still having a large buffer of funds in case something happens to me or the economy as a whole.
The end result is total financial peace of mind.
That's a pretty bleak outlook, I know. However right now the depressive realism I had when I chose to switch is looking prescient, up here in the North East of Europe. No worries. :)
Because that's easy to do for everyone?
Is it? I don’t think it is. Why do you think it is?
Insurance: it depends which country you stay but you should have medical insurance.
Gold/Silver: Gold/Silver use as a hedge. If you have these metal in your wallet good.
Paper money : if you can, invest money in currency basket.
Digital : keep some coins secure.
Expenses: Reduce non essential expenses.
Health: Keep yourself and your family healthy by doing daily workout or yoga.
Silks: learn new skills. Make yourself valuable.
Survival mode : Always on it. Learn to analysis situation and act.
Gold is already jumped so that is too late. Crypto seems correlated with stocks.
I’m counting on a large gap between salary and expenses to save my ass
Instead of eliminating an asset completely, come up with an estimate of its value to the economy in the future, relative to the other assets (do this to cash also). Then, target your portfolio to match that distribution.
While gold jumped, it doesn't mean it's over. And while crypto has been correlated with stocks, it still has some non-correlated part, introducing diversification, and you certainly don't need leverage to target a desired volatility.
Other items to consider:
* fertilizer (food prices going up means fertilizer will do the same; but it has doubled in the past year)
* farmland REIT
* office REIT (if you think the economy comes back to the office)
* Ukrainian stocks ("buy when there's blood on the streets" also means "invest when the country most needs it")
Keep in mind buying stocks in a public company doesn't directly "support" it; buying stuff from them, or buying their bonds, does. This is basically the issue with ESG index funds.
They might need to buy food or flee using the money, and by bidding up the stock prices you help them (even if just a bit).
Preparing for hard economic times will involve having enough of a buffer to survive the loss of a job, and to have a stable job.
That way, you will be more easily able to provide your family with food. Especially if both you and wife can do the farm work.
And perhaps, with the farm at some point you might be able to live without needing to work much.
Some inspiration can be found here: https://www.youtube.com/watch?v=T15gXm6ha_I
A big polytunnel in the garden might make sense as a time-consuming hobby with practical benefits (though I still think it would be more expensive than just getting groceries), but not a farm.
Side story: One time at a co-op I bought a 9-pound bag of cashews (unsalted!). Just for a lark I ate nothing else until it was gone. No downside (but several years before I wanted more.)
Trim excess expense that doesn’t bring you something
Invest the excess into something durable (house, stock, gold, etc)
Don’t hold dollard in your account, it’s value is going down
Look into increasing your value/salary
I was thinking of buying some shelf stuff that keeps value during a recession for selling, but I don't really know what to ge yet. Any ideas?
Also in Europe there are Forex brokers that offer contracts (CFDs) on commodities, but there are a lot of scammy firms in this area, and the spreads charged are usually hefty.
(according to wikipedia in US CFDs are banned)
US petrol prices are very cheap.
"just trust me bro"
pretty good chance i wont do any of this.
If the crash is "naturally" deflationary, the central banks have now shown a commitment to sustaining inflationary policy to keep inflation at target.
But in the case of a "naturally" inflationary recession (stagflation), central banks will be hesitant to ramp up deflationary policy, because regaining employment levels will be a higher priority, and deflationary policy tends to hurt employment.
So here goes.
It's reasonable to pull your fiat and putting it into something hard, like physical silver. Not bars, but the smallest units of coins you can get.
Insurances and other stuff that relies on the stock market are going to go bust, so you might want to consider cancelling.
I advise against gold, because governments everywhere could decide post-crash that your Gold belongs to them. It's not unprecedented. There's no guarantee they will pay you for it with whatever money we'll get to use post-crash. When trading Gold is outlawed, your Gold becomes basically worthless.
There's far lower risk for that to happen with Silver. Gold seems to be a great short term investment right now, with the chance of Gold shooting up relatively soon relatively quickly being ... uh ... relatively high. So for short term greed definitely an option, but in current times I wouldn't bet anything on it for the long term.
This is for preserving your wealth and moving it post-crash.
Then, of course, comes food and water. Everything that keeps long-time is good. Given that your fiat is going to go poof, spending a lot of money on food that lasts isn't a bad idea. Worst case you'll have long lasting food you don't need, best case you have food.
Then there's cooking. Ignoring that power is getting more and more expensive, there's no guarantee you won't be suffering from BlackOuts, where ever you live. Personally I've bought a few tanks of propane gas, which doesn't go bad and lasts for a long time. It's like camping. Gas + Cooker.
If you can find anything useful regarding solar, then go for it as well. Always have more than one options available. It's important to never bank on a single thing working out as hoped.
I advise for keeping a few months worth of money on your bank account. You know, regular payments, etc, but the majority should be converted into something you actually can own. That includes cryptos. There's little reasoning to believe that people won't jump into cryptos just as much as hard assets.
In case prices drop: don't sell. In case prices shoot up after the drop (or without the drop), consider not selling silver/cryptos for a currency that's going to go poof anyway unless you have really good use for that fiat.
It's not about getting rich, it's about having something you can sell for the new money, post-crash.
I strongly advise AGAINST hoarding things with the idea of selling them to others who need them. When shit really hits the fan, these people will be overrun and killed by the angry, hungry, desperate mob.
Yes, the world and the people really are in that bad of a shape right now.
Think about everything and do not do panic actions.
Talk to others about what they think.
Do not let yourself be hindered in thinking about this.
Don't believe anyone who tells you it'll be fine anyway, because the risk isn't worth the short bliss of ignorance until reality smacks you in the skull with a metal baseball bat.
With Covid-lockdown and remote jobs, you can drastically cut your expense if you can move out of the city.
I'm aware of the work it takes to live off the land. I don't have the skill or fitness to do so but still dream of trying that one day.
- housing: pick in a flat to keep your energy costs low (neighbors heat one another), and make sure you can walk to a park or a river. Fight to make your city more walkable and bikeable, and support your local businesses. Make sure to live close to people you like or to build new relationship (can't beat cities for that!). I love my neighbors and we regularly organize meetings to ensure every one is happy (that was so awesome during lockdowns, I never felt better surrounded). Being in a city means you stay close to people you like (so important during harsh times) and have more transportation options. I can walk anywhere: doctors, police, markets, train station, etc. Note that my French grand-parents always said that WWII was much easier for townspeople (the bigger the city, the better) and given their experience, I fully trust them when planning for harsh times.
- transportation: I spend ~€10 per month for my transportation needs (I own a cheap, light bike to go to work and move around). I take the subway/train sometime (when I'm too tired to bike) but it's much cheaper than all other options.
- food: I'm a member of a coop i.e we partnered with a local, organic farmer to commit to deliver all his production directly to us, for the whole year and at a fixed cost (around ~€15/week for a big basket of vegetables). I opted to get other produces from the coop, from other farmers/artisans: bread (1.5 kg/week), flours, oils, fruits (apples, pears, oranges, pomelos, kakis, berries…), café, etc. No distribution and overhead cost (we run everything ourselves, and do the distributions once a week). The inflation is very limited inflation (almost zero logistics costs, little impact of market prices) and at least one year of visibility and cash. This helped me become vegetarian: the food is so good, cheap and more sustainable. Coops let you have the benefits of the the city and the countryside, and you can't better help farmers (we work together to ensure they invest in the long term, protect their health, use as little fertilizers and pesticides as possible…).