# YMOYL vs SHTF



## logbuilder (Jan 31, 2006)

Another thread got me thinking about this and I thought it might be an interesting discussion.

If you have read 'Your Money Or Your Life' (YMOYL) and you also believe there will be some sort of SHTF scenerio that greatly impacts the US financial system, how do you balance the two in terms of what you do today?

In YMOYL, if you recall, the ultimate goal is to have enough saved and invested in relatively safe investment vehicles (govt bonds were suggested in the book) that are earning income so that all your expenses are covered. Then you will have achieved financial independence (FI). Given, there is a lot more to YMOYL but that is a reasonable summary.

Now on the other hand, if you are bought into the notion that there will be a SHTF scenerio where US dollars are worth lots less than today or maybe even worthless (well, maybe good for TP but personally not as soft as I like), you would be thinking that getting your money out of US dollar based investments would be prudent. Many SHTF proponents would tell you go put your funds into things that would likely retain or increase in value after SHTF such as gold, silver, food, ammo, fuel ..... You would use these things after SHTF for bartering purposes. Prior to SHTF, these things you invest in will not be able to provide income (in US dollars) for day to day expenses but you would surely be in a good position post-SHTF.

So now we have two strategies that both make sense but unfortunately, they are both based on an assumption that must be either TRUE or FALSE for either to work. The assumption is this:

YMOYL relies on the assumption that the dollar and our financial institutions are somewhat healthy.

SHTF relies on the assumption that the dollar and our financial institutions are worthless.


So obviously, the two seem to oppose each other, at least in terms of how you manage investment funds.

Clearly, if you perfectly knew the timing of the inflection point, you would follow YMOYL strategy prior to that point and just before the inflection point, you would move into the SHTF investment strategy. But of course, who knows when that might happen with any degree of precision.

So what do you do?? Pick one or the other? Is there some balance?

Oh yea, lets assume that your funds available for investment are just enough to make YMOYL work long term. There isn't enough for totally funding both strategies. To the extent you decide to do SHTF based investing, you must decrease your YMOYL funding thereby limiting your FI.


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## Gary in ohio (May 11, 2002)

What you need to stock up on is knowledge and skills. Your 3 year cache of food, 10 ,000 gallons of water and diesel fuel tucked away on remote well defended homestead is worthless if your home is contaminated with chemical, nuclear or biologic contaminants and you have 10 minutes to leave or die.

Know how to use raw materials to make, build or grow what you need is as if not more important then a well stocked cabinet.


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## hisenthlay (Feb 23, 2005)

Excellent question. I don't think I've ever posted on this forum before, but I've had that exact thought, and I'm eager to hear what others have to say. We're going far more the YMOYL route right now, but when that is built up to a comfortable degree (or if we think we see that inflection point coming), we've discussed switching to the SHTF resource building. If we see good SHTF resources come along now we do sometimes pick them up, but it's haphazard and occasional, and we'd pretty certainly be SOL if the SHTF tomorrow.


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## Guest (Sep 12, 2007)

logbuilder said:


> So what do you do?? Pick one or the other? Is there some balance?


 Yes, do BOTH.

Diversity is good.

Life is uncertain. Either of the above MIGHT happen so prepare against both.

Excessive focus on one scenario or set of scenarios leaves you at serious risk to those that you are ignoring.

.....Alan.


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## Cyngbaeld (May 20, 2004)

I think for most of us, just getting out of debt, having a home paid for, a vehicle paid for and a store of food and other necessities, should be the first order of business. Not paying interest on your home and vehicles or credit cards, etc will go a long way towards financial independence. After that you can hedge against inevitable inflation by purchasing in bulk for food and other necessities. Then you want a savings plan for things like taxes and replacement vehicles and repairs on your home. Of course you would continue to make periodic bulk purchases to replace what you use up. I don't expect I would ever have the kind of income to even consider investing in the stock market, or gov bonds, nor would I do so if I had the money, since I feel it is not an honest way to get gain.


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## Ramblin Wreck (Jun 10, 2005)

Cyngbaeld said:


> I think for most of us, just getting out of debt, having a home paid for, a vehicle paid for and a store of food and other necessities, should be the first order of business.


Amen.


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## halfpint (Jan 24, 2005)

logbuilder said:


> SHTF relies on the assumption that the dollar and our financial institutions are worthless.


I disagree with that statement, for me, SHTF has hit when someone has been sick, loss of job and such. I had a friend who had stocks of enough of everything for a year, and did not have to worry about purchasing supplies the first year after her husband died. One situation of SHTF may be the demise of the dollar and our financial situations, but there are many other SHTF scenarios besides that one.

As far as getting out of debt and stocking up, I try to do both. If I had to choose between the two and had a very heavy debt load, I would probably lean towards getting out of some of the debt first. With a light debt load, I have a higher priority on stocking up. But if possible I recommend staying out of debt in the first place.

If I'm choosing between investing and stocking up, stocking up would be my first priority.
Dawn


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## GrannyCarol (Mar 23, 2005)

Get out of debt, pay off whatever you can. Realize that in today's world, you do NOT own your land, but the government does. Seek out God so that you know His rest and provision for all things. Gather together the things you desire and that you enjoy and trust God. 

In that place, I find that I lust for a lot less than I used to and we are paying off our debts without even working at it. I also enjoy making and preserving food and growing it. I'm in a much better position of things go bad today than I would have been in the past, but not out of fear or worry, just following my true desires. I thank God.


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## amelia (May 3, 2003)

Hey, Logbuilder--

To the best that I can recall, YMOYL assumed an investment in long-term treasuries having an average yield of something like 8 percent. Obviously that's not the reality today. With the real rate of inflation hovering around 13-14 percent, a portfolio consisting predominantly of treasuries simply would not perform the function intended by YMOYL--preservation of capital and modest growth. Add to that the tenuous position of dollar-denominated assets in the current economic environment (most notably the fact there's some $30 trillion in OTC credit and default derivatives waiting to unwind) and the likelihood that the Fed will opt to sacrifice the dollar in order to save Wall Street. . . In short, I just can't see treating treasuries as the save haven that they were in the past.

I don't really see YMOYL and SHTF as an either-or proposition. YMOYL can, and should, be adapted to changing economic conditions when it comes to particular investment decisions. For me, that means a portfolio that can weather, and ideally flourish, in severe turbulence and sustained downturns.

I have been looking at the Permanent Portfolio (based upon the "Failsafe Investing" model of Harry Browne), also the Prudent Global Income Fund (a very level-headed foreign bond fund, with some gold and mining stocks tossed in). Swiss and Canadian currencies seem to have some merit and are easy to get into with the new exchange-traded funds, FXF and FXC. And then, of course, there's gold--check out CEF for one option.

Over the last year, I've focused a lot on the subject of global economics and investing. It's not really how I want to spend my time, but I've come to believe that--like it or not--financial independence is no longer as simple as holding a nestegg in a single "safe" investment.


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## Beef11 (Feb 2, 2006)

This is what i've been comtemplating the last week. What i want to do is get myself in a situation where i can be prepared in a situation that disrupts food supplies or deflates or inflates the dollar. Deflation would increase the value of debts owed. On the other hand i don't want my money in investment vehicles of little liquidity. I also don't want to be a doomsdayer hiding in a cave waiting for the end. My answer is get ahead food wise. Invest in things that can make money in a good economy and will be an asset also in a bad situation. My answer... Cattle. My background is in cattle so that probably put me on the road. I can make good money as far as rate of return in good times and in bad times i'll eat steak. I'm not saying i'll be 100% vested in cattle because i will diversify but i see it as a good oppritunity to fly safe and position myself well on two fronts.


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## goatsareus (Jun 23, 2007)

Interesting question. Dh and I read YMOYL in the early 1990's and loved/love the book. We were able to invest in the 30 year treasury bonds, as was suggested, but not nearly enough to live off the investments. We do not know how to invest our money. Recently a lot went into CD's because the rates were so good. I advocate purchasing high quality items, such as the front loading washing machine we got this summer, but dh is pretty tight with the moola and does not easily part with it. We are pretty gutless when it comes to investing, can't sleep at night, so we have a lot in mutual funds too. From what I have read, gold and silver are not good investments?? I am retired and dh is close to retiring, we are in our mid fifties. So we hopfully have many years left, and are at the end of producing income.

We live a very low profile, so expenses are not great, $32,000 has been the average expenditure the past several years. And I'm telling you it takes a bunch of invested money to come up with enough to live off the interest.


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## Chuck-prime (Jul 24, 2007)

Beef11 said:


> My answer... Cattle. My background is in cattle so that probably put me on the road. I can make good money as far as rate of return in good times and in bad times i'll eat steak. I'm not saying i'll be 100% vested in cattle because i will diversify but i see it as a good oppritunity to fly safe and position myself well on two fronts.



Part of investing in cattle is actually preservation, but I'm referring to those people who would want your cattle more than you.


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## amelia (May 3, 2003)

_"We are pretty gutless when it comes to investing, can't sleep at night, so we have a lot in mutual funds too. From what I have read, gold and silver are not good investments??"_

Gold can be counted upon to hold its value over time. It has been said that a one-ounce gold coin bought man's suit in 1850, and that it will buy a man's suit today. Very true.

When people talk about investing in gold, they can mean many different things. Investing in "physical" gold (meaning taking possession of gold in the form of coins or bars) is regarded as a very safe way of storing wealth over the long term. Investments in gold stocks (meaning investments in mining companies) are a horse of a different color. Those investments tend to be highly leveraged and involve risks of all kinds. Investments in gold derivatives are the most risky, and are only for the speculator. More recently, gold has become available in the form of exchange traded funds ("ETFs"), which are similar to mutual funds. The basic idea is that the ETF holds a pile of physical gold in a vault, of which you buy a share.

When people say that gold is a bad investment, they are generally comparing its return to that of stocks over the last few years of the bull market. People have short memories. 

Gold is especially intriguing today because of its high negative correlation to the dollar. Last week, the dollar breached the psychologically-significant benchmark of 80, and is poised to drop lower if the Fed does what the pundits are saying is all but certain--a lowering of interest rates on September 18. It's no accident that gold has shot up from $682 to $714 in just a matter of days. Maybe Mightybooboo is around and can add some words of wisdom.

Any way you cut it, though, gold is volatile. Folks much better versed than I have predicted that if the bottom falls out of the stock market, gold will temporarily be taken down with it. That seems to be the trend, that large institutional investors liquidate their gold holdings to meet margin calls when their investments go sideways; then gold recovers and launches into an upward trend.

Frankly, I don't know any way these days of avoiding volatility without getting totally wiped out by inflation. The best solution I've come by is to put together a well-diversified portfolio composed of a number of asset classes that tend to have negative correlations to one another.


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## logbuilder (Jan 31, 2006)

I'm responding to some of the posts that I think addressed the OP.

*Amelia* - Thanks for your response. I have always respected your opinion. I would agree with you that YMOYL suggesting treasuries is somewhat outdated. I've not taken that route but have stayed with very low risk securities that provide a known fixed amount of return. So far so good. I'm always relooking at things and make adjustments as my research uncovers better vehicles. I'll be looking into the permanent portfolio you mentioned. That said, I guess what I'm trying rationalize is what happens if the US or global financial markets collapse? All gone... poof... zip? Even though you might look at low risk investments now, what happens if the whole thing collapses? In that extreme case, I guess I'd prefer to have a bunch of gold and silver buried safely somewhere. But to take that action now pretty much would prevent FI until SHTF.

*BEEF11* - given that you are already into cattle, sounds like you have made some good decisions. For someone who is not currently able to do that on a large scale, probably not a good decision. I think you have taken advantage of your situation and are on a good road to weathering good and bad times. Sure there is risk but you've mitigated a lot of it. Thanks for relating your situation.

*Alan* - From what I have read of your posts and stories, I consider you one of the most level headed as well as knowledgable people in terms of SHTF and preps. Thanks for weighing in on this topic. I totally agree that being prepared on all fronts is the best solution. In a SHTF scenerio, I think that John in We Interrupt This Program... is a great model of how to react to this type of SHTF situation. To a large degree, I'm using what I read there as a model of actions I take today for preparation. But lets assume that John had reached FI (as in YMOYL) and pre-SHTF was living on his investments. Did he just loose all of them? Part of his preps was food, ammo and gold/silver and that is what allowed him to be able to barter for things he didn't have post-SHTF. He of course had knowledge that allowed him to begin to provide for himself via farming and raising livestock. Would he have only had a small portion of his pre-SHTF nestegg in those preps? I guess maybe the reality is that if SHTF, all bets are off and what you have is all relative to what others have. If all forms of currency are tanking, very likely everyone is in the same boat. Your small hoard of gold/silver could be a fortune if most others have none. Maybe the real wealth is how much extras you have of the essential items required just to live along with your knowledge of how to make more of the esstentials. Those things will be very valuable to others that don't have anything and your bartering power is pretty high. I have many facets of prepping covered - security, water, food (although that is an ongoing project with a long ways to go), no debt, homestead large enough for vegatable production if required. There are others that need attention such as making sure that, longterm, I could pay taxes on property with funds other than dollars, securing meat (venison would be available easily but other alternatives would be nice), networking with local community, fuel (my generator is an integral part of my preps), spare parts to keep tools and machinery going, and solar power generation.

To all that suggested getting out of debt, that is exactly what YMOYL suggests. If there are those of you that haven't read the book, trust me, it is worth your time.


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## Karen (Apr 17, 2002)

It really all depends on your circumstances - and peace of mind. You first have to take a look at evaluate how far away, you believe, we are from when the SHTF.

If you have faith that you have quite a bit of time yet, then paying off debt is the way to go; along with investing in long term financial programs.

If you feel pretty certain it's right around the corner, then putting all you have into paying off debt, when you have no investments at all and no (or little) food or provision is not going to be your solution for peace of mind.

There are two ways to look at debt. Either you need to get it paid down so you can sleep at night; or in a true SHTF situation and there is an economical collapse, debt no longer matters because those you owe will be shut down.

With investments there are also 2 ways to look at it. You either plan for things like retirement and income; or you invest for security measures should there be a long term SHTF. Stock, bonds, mutual funds, etc. will be worthless in an economic collapse. Gold and silver will always have a value. You won't want to buy a bag of corn with a gold piece, but it's peace of mind to know you could if you had to. It's better to have a piece of gold that will buy that sack of corn than a piece of worthless paper. Gold/silver gives you options during economic collapse. Other investments bring you peace of mind in good economical times.

Food, medical supplies, and other provisions will be good as gold when people get hungry. Things like coffee, whisky, and cigarettes have historically been held as very valuable items in times of SHTF. 

So the point is, you have to decide for yourself where your comfort level is and what would be the best in your family situation. Don't rely on other's insistence of what you should do. It's VERY IMPORTANT you calculate and figure it out for yourself based upon your family's needs and present financial situation -- as well as how soon you believe the bottom will fall out.

No one knows for sure, and you can't plan for every situation, but you can plan to give you peace of mind in the interim. It means a lot!


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## SquashNut (Sep 25, 2005)

look for a thread called every day shtf

bassketcher


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## amelia (May 3, 2003)

Further to Goatsareus's question about whether gold is a "good" investment, here is a link to the Vanguard Boglehead discussion group, where the topic recently came up. I chose this particular discussion because the Bogleheads tend to be a very conservative, academic crowd who generally have a strong bias--if not outright contempt--for contrarian investments. So their collective viewpoint probably represents one of the most critical viewpoints on gold that you're going to find.

http://www.diehards.org/forum/viewtopic.php?t=5520


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## logbuilder (Jan 31, 2006)

amelia said:


> I have been looking at the Permanent Portfolio (based upon the "Failsafe Investing" model of Harry Browne


Amelia,

Is this the proper link to the Permanent Portfolio?? I want to make sure I am looking at the right one as I try and understand their strategy.

http://www.permanentportfoliofunds.com/

Thanks,

Robert


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## diane (May 4, 2002)

We worked for many years to get our ducks all lined up in a row. Out of debt, both hand and gas powered tools and equipment, forty acres with enough tillable land to be self-sufficient with plenty of woods to provide heat, large fence rows allowing nut trees and wild berries to florish, large orchard and gardens. Then we started on cash on hand, and longer term investments including 401K. When the younger folks voted that our 401K's be more high risk and we started losing, we were old enough that we could pull out without penalty so we went to a more conservative approach. I have kept a two year pantry (not Mormon but respect their plan) for years and years and when my husband died a year ago I never bought a thing except some fresh produce last winter until just recently. I am living on way less income than we had planned, but my lifestyle has always been way below our income so I have really had no adjustment at all except less money to work with which has been no problem to this point. 

I guess my point is, we can plan plans but not results. The S can hit the F in ways you never expect. I am sure grateful I have always been a prepper, homesteader and wildcrafter because not much scares me. I believe that if you think about it and make a plan that fits what you believe and then work that plan while being flexible, you will be surprised at just what you can accomplish.


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## amelia (May 3, 2003)

logbuilder said:


> Amelia,
> 
> Is this the proper link to the Permanent Portfolio?? I want to make sure I am looking at the right one as I try and understand their strategy.
> 
> ...


Yup. That's the one. 

You might also enjoy reading Harry Browne's little book entitled "Failsafe Investing." As I understand it, Mr. Browne (who is no longer living) was instrumental in the original design of that fund. The basic idea of the portfolio, as originally conceived by Mr. Browne, was a 25/25/25/25 split between four asset classes--growth stocks, long-term T-bonds, gold, and cash equivalents. The objective was a mix that would hold its value and grow at a modest rate with minimal volatility no matter what economic climate prevailed: prosperity, inflation, deflation, or hard money. The Permanent Portfolio fund deviates in some ways from the original concept--for example, it holds some Swiss-denominated short-term assets, but the approach is basically the same. I'd be interested in your impressions.


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## Cyngbaeld (May 20, 2004)

NEVER count on debt 'disappearing' under any circumstances. Someone, somewhere, somewhen will buy that paper and you will HAVE to pay.


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## logbuilder (Jan 31, 2006)

Amelia,

Your PM inbox is full. PM me with your email address.

Robert


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## Ryanstones (May 10, 2005)

logbuilder said:


> So what do you do?? Pick one or the other? Is there some balance?


What you do first is educate yourself as to what is really happening economically and culturally. Ask google a question and follow the breadcrumbs that feel right to you.

A documentary I saw a few weeks ago has refined my understanding of our collective situation to a fine point. Highly recommend whatawaytogomovie.com No TIN Foil in it at all.

As for balance, good luck. A good friend of mine, former vietnam helo pilot, and now commercial transport pilot has been agonizing for 3 years over how to protect his retirement nest egg and has been whigging out this last week with all the strange and disturbing events taking place. Last word, he's going to take the 50k penalty + taxes hit in order to activate his own 'game strategy'.

As for balance I wish you the best of luck. I think that's why i've been posting here more, for some balance. Since, starting my quest to understand the whats and whys, I seem to get the chair kicked out from under me every time i think i'm finding the balance point.


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## MorrisonCorner (Jul 27, 2004)

halfpint said:


> I disagree with that statement, for me, SHTF has hit when someone has been sick, loss of job and such.
> Dawn


I'm with Dawn.. SHTF for me is not so much "national or international calamity" but nitty gritty personal. But the net result is still the same... 6 years ago when the towers came down our expectation was that we'd find ourselves hosting a lot of unexpected guests. I filled our gas tanks, put fresh sheets on the bed... and checked the pantry. But the pantry I mange because "buy low" is good personal economics and keeping things on hand is just easier was ready to weather a large disaster and a smaller personal (job loss, death) one.

The caveat to my pantry/personal supplies is that they are not portable. Any "SHTF" situation I'd face I'd have to face in place. I'm simply not moveable.


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## goatsareus (Jun 23, 2007)

amelia said:


> Further to Goatsareus's question about whether gold is a "good" investment, here is a link to the Vanguard Boglehead discussion group, where the topic recently came up. I chose this particular discussion because the Bogleheads tend to be a very conservative, academic crowd who generally have a strong bias--if not outright contempt--for contrarian investments. So their collective viewpoint probably represents one of the most critical viewpoints on gold that you're going to find.
> 
> http://www.diehards.org/forum/viewtopic.php?t=5520


Thank you amelia for the link, appreciate it.

We were very lucky to be able to buy our 30 year treasury bonds when the yields were around 8%. But by far the best investment we have made, was kinda by accident. We needed to buy the adjoining 35 acres from our former business partner in order to have road access to our back hayfield. When he moved, we could not count on the good will of new neighbors to drive across their land to get to the hayfield. So we bought the house and land from our friend/business partner. We had no intentions of becoming landlords, but, it has been a very lucrative decision. Dh is a home builder, so maintaince is not a problem for us. It is a very small, tight house and we have been blessed to have gotten good renters. We will not buy any other property though. We own two houses, 70 acres mostly in young woods, have our own hay making equipment, have dairy goats, large gardens, do our own butchering, heat our home with wood that we cut. Been working at this stuff since 1975 and are ready for a rest!


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## sgl42 (Jan 20, 2004)

I don't see a contradiction between the 2.

How much are you planning on spending on preps? What's your wish-list look like? Assume you can earn 10%/year (an aggressive assumption today). Each 10k of savings gives you 1k/yr income. I don't know anyone who could live on 1k/yr. But you can buy a heck of a lot of preps for 10k.

Yes, I can see land, a house, and tractors and such could easily consume lots of money. And if you really think the lastest and greatest weaponry will be essential to survival, I'm sure you can fork over a bunch too. But outside of that, how much would you spend on preps? How much are you going to be earning on the money you spend on preps?

re: Preps:

As for me, I've started prepping in the last 6 mo or so. After thinking it over, and outlining various scenarios that I thought were possible/likely, my preps so far have boiled down to:
1) buy camping equip
2) stock up on food and food preservation equip

I think the time and thought process has been far far greater than the amount of money actually spent on it.

Now admittedly, I'm single, debt-free, and I rent rather than own, so my situation is somewhat different that others.

The camping equip is cheap insurance. I've spent in total probably less than 6 mo of car insurance premiums on all the camping equip i bought. It should last for quite a few years without further costs (other than room to store it). Regardless of whether TSHTF or not, it's pretty much a guarantee that at some point I'll lose power at a time that I'm hungry and the camping stove will be useful, or have the heat go out and the sleeping bag will be useful. And the side benefit is I can go camping sometime, something I enjoyed as a kid but haven't done in years. 

As for food & food equip: the food I'm going to eat sometime anyway, so its only a matter of when I spend it, not how much. Probably cheaper buying in bulk, definitely if inflation continues, with probably a small loss due to spoilage and changes of taste. And again, it's not a huge amount of money, particularly compared to the amount that would be needed to earn enough investment income to live on. But probably not worth maxing out the credit cards at 18% to stock up either.

re: food equip: Again, cheap insurance. I could put off buying it, but would make storage more difficult. It probably pays for itself in food cost savings, but even if not, it's cheaper than 6 mo of car insurance, and should last a fair amount of time. 

The other reason I purchased it now is (a) if TSHT, there will probably be a run on various items that many people do not have, (b) my own learning curve. 

I haven't done much about medical supplies yet, other than a basic first aid kit, altho that's next on my list after food/food equip. And I haven't purchased any guns/ammo yet. I probably will at some point, but not an extensive amount. I expect all this will also be about 6 mo of auto insurance or less.

And I don't have any equipment for specific threats, eg, NBC attacks have specific equipment that don't really have many other uses. 

For me, I don't own any real estate. If I did, I could certainly see spending more money on that, particularly fruit trees, maybe a greenhouse, a generator and/or solar panels, and a wood stove. And extra insulation if I didn't already have great insulation. The fruit trees and the extra insulation would have very specific paybacks over time, so they probably make sense for anyone. A basic woodstove is probably cheap insurance too. A high-end woodstove in a mild climate might be overkill tho. 

A generator is probably the tougher one to decide whether to buy one or not, and whether to get a high-end desiel or a low-end gas one. 

Some people would buy a tractor. If you're planning on being more of a farmer than a homesteader, that probably makes sense. But I'd guess that unless you get a really good deal, or have specific needs, you're not likely to get a high payback on a tractor for raising food for just your own family.

But for most people, the cost of the house is mostly determined already by the size of the mortgage, and the amount of local property taxes. Given the state of the real estate market in most places, it's probably too late to sell and move elsewhere easily, so you're probably better off where you are now in most cases.


re: savings & investments:

first, you need a reserve of cash for when (not if) something unexpected expense comes up, or you lose your job. 3 mo min living expense, 6 mo way better, and even more in todays uncertain economy unless you have a highly stable job in a stable industry, (or incriminating pics of the boss  )

The current high P/E ratio of the stock market means that statistically, the chance of exceeding about a 5-6% return /yr over the next decade are pretty low, and there's a good chance the returns will be slightly negative (ie, negative 1-2%/yr) (see www.hussmanfunds.com for really good info on this.) And with a global residential real estate bubble, I think real estate is out too. 

Also, I believe they're cooking the books on inflation so long term bonds aren't a good deal either, unless deflation takes hold, which it might.

So, by process of elimination, that leaves gold, cash, and currency for now, in my view. It won't be this way forever, but until other asset classes get to reasonable levels (ie, they fall in real terms), or until the deflation/inflation situation becomes clearer, I'm not ready to jump on anything else. (I've belabored my views on investments on other posts on this forum, so I won't rehash all of them here.)


So overall, I don't see TSHTF spending and YMOYL spending as being contradictory in general. There are probably a few specific items where you have to make some tradeoff (eg, the generator). But most of TSHTF prep items are things you'll most likely use anyway even if "the big one" never hits, and at far lower cost than if you wait until the last minute to buy them, or adapt to not having them (eg, paying for a hotel, or restaurant meals, because you didn't have any food, BOB, etc when a simple mechanical breakdown or utility outage occurs). Simple early-payment (eg food storage), or Cheap Cheap insurance (eg, camping stove, sleeping bag).

The 'survival' sites advertise the same way the car companies and the cosmetics companies do: trying to convince you that you need to spend lots and lots of money on things. And usually there's very inexpensive alternatives; or a few high-end products that last a lifetime but are worth it compared to the moderately priced crap that'll breaks in a year or two. Use your frugal skills. Take time to research it. My big burkey will pay for itself in lower price/gal filtered, compared to the brita filter I had before, in a year or two. If I drank bottled water instead, it would pay for itself in weeks or months. But burkefeld doesn't have the big advertising budget, nor are they on the store shelves at the grocery store. It made sense for me to buy it regardless of TSHTF, but it also has a great use in prepping too.

--sgl


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## goatsareus (Jun 23, 2007)

sgl42 said:


> I don't see a contradiction between the 2.
> 
> How much are you planning on spending on preps? What's your wish-list look like? Assume you can earn 10%/year (an aggressive assumption today). Each 10k of savings gives you 1k/yr income. I don't know anyone who could live on 1k/yr. But you can buy a heck of a lot of preps for 10k.



We have used the ratio of $20,000 invested for $1000 interest returned. So for us, that means having $640,000 invested to have enough interest income to keep our current lifestyle. We are not there yet!


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## AngieM2 (May 10, 2002)

Might be interesting to see if anyone's changed their thoughts, we are 6 months later and things are getting more interesting.

Angie


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## ailsaek (Feb 7, 2007)

Well, there's that Wall Street Journal article....


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## NoClue (Jan 22, 2007)

Generally this board isn't interested in people actually making money from stocks and bonds, being much more interested in hearing how things are going to heck in a wheel-barrow.

I did a major pruning of my stocks last year, took some profits and then some losses to ease the taxes on the gains. Ironically, most of the money that I sank back into the market went into issues I'd only recently sold, based on the idea that they were heading towards bottoms but that I could profit off their bounce.

A good example of this is Ford - I bought in the first time at 6.80, sold off at 9.20 (I missed the top but sold when the clear trend was down). I sat on the proceeds and then bought back in at 6.15. Now Ford is sitting in the 8's and will probably be hitting 9 soon, in which case, I'll probably sell off again. When I get these 40% gains and higher, I pull my principal out for safe keeping and reinvest the gains. It's not the fastest method, but it reduces risk.

I have a financial goal I'm working towards in my investments - that of being able to buy a 40 acre farm in my chosen area with cash, and to produce 12000/year of cash flow, and while everyone has told me I can't do it, that the economy is trashed and the dollar is worthless, I'm about 3/4 of the way to my goal. I plan to 'retire' by the time I'm 50 and farm until I can't pull myself out of bed anymore.


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## Willowdale (Mar 19, 2007)

YMOYL is right - the best preparation is to get out of debt, simplify your lifestyle, learn to be happy without "stuff". That's a homesteading logic if I ever heard one.

The only difference is a relatively minor one, which is how you should invest your money so it supports you. Treasuries may not be the best bet right now, but they're not so bad unless the government collapses (I maintain that's not as likely as some assume, but whatever). Some folks like gold, although it's not so useful as currency *until* the world collapses, so that's a heavy bet to make on complete collapse. Best bet, as many have said, is multiple bets - cash savings, treasuries, gold, whatever. There are some investments that I feel comfortable with that would make other more conservative people squirm, but that's all just personal choice.

YMOYL doesn't advocate what many of us think is a good idea, buying land, owning it outright, getting it to where it supports many of your basic needs, without accruing debt. I think rural self-sufficiency isn't counter to YMOYL, per se, they were just city folks and thus more focused on living in a town community. And you can't get around needing money, no matter what. Taxes are a given no matter what, medical care, charity, fuel, equipment repairs, all the many things you can't produce yourself.

So do all of that  I'm, um, not remotely there, but I'm headed in the right direction. More prepared than lots of people in the wide world, but not even close to many of the people around here.


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## tnborn (Mar 18, 2005)

For my family, we're trying to get everything paid for path. store what we need and life as simply as we can. try to squirrel away money and invest wisely. Main plan is be self-sufficient as possible along with having peace of mind and enjoy life while we can.

I have never seen a u-haul behind a herse.:shrug:


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