How To Be Financially Prepared
I'm down on the U.S. economy for several reasons. I'm scared because I see indicators I've never seen before:
- Devaluation of currency...
- Stock market drops...
- Bank runs...
- Capital control...
- Real estate crash...
And much more.
Most crisis is unavoidable. The best you can do is to look at indicators. But you never really know. Most people are unaware and unprepared. You need to know where you are and where you're going.
Ask yourself these questions...
Are you over leveraged in your investments?
Invest in real assets now. Hold onto them. Like gold, silver, and real estate. Gold and silver are great for the long term savings, and the real estate will cashflow to you.
How much are you in debt?
Make sure you never carry any bad debt. Any good debt should be able to be covered by the asset three times over. Pay off high interest first and work your way to the lower and zero interest.
How large is your emergency fund?
You always need to be in a state of mind for this. You always need to be living below your means. Look at all the expenses that you pay on a monthly basis and work to eliminate them or reduce them. Look for the best possible price. You should be doing this on a regular basis. Stop eating out.
What is your backup plan?
Increase your income, provide a service, sell a product. Looks towards something that will work in the long term and in a down economy. Have multiple streams of income so if one fails or they all take a hit you will still be able to survive. Always have one income stream that you can do remotely. This will allow you to find a more affordable place to live.
Have you used margins to leverage?
Do more with less. You need to have diversification. This is where the five pillars comes in handy. They include:
- Income stream
- Real estate
- Precious metal
The 5 pillars will give you the diversification that you need to get through this type of emergency.