The next economic collapse could be right around the corner. These things are unpredictable, both in when they happen and how long they will last.
There are 6 things everyone should do to prepare for an economic crisis or collapse:
- Start Prepping in General
- Get Your Financial House In Order
- Invest In Gold and Silver
- Learn a Skill or Trade
- Get And Stay Healthy
- Learn How to Defend Yourself and Your Home
Why Might The Economy Collapse?
Before we dive into detail on how to prepare for an economic collapse, let’s take a moment and talk about what might cause such an event.
Today’s economy is a large and complex weave of people, small business, big business, and government. The very nature of this interwoven mess makes it like a “tamed” wild animal, it may be fine most of the time but every once in a while, without warning, it may act on instinct and bite you.
When it comes to the leading factors that cause economic collapses to occur not one is the same as the other. Looking back at past economic collapses and crises each one had its own unique set of conditions that led to the tragic outcomes that we can study today. What we have learned is that predicting the time when one will occur is impossible but preparing to survive on isn’t.
Things that may contribute to an economic collapse:
- Stock Market Volatility
- National Debt
- Cyber Attack
Stock Market Volatility
Let’s look at the stock market. The stock market can be used as a weather vane to see how the economy is doing on a day to day basis. Sometimes there’s a lot of volatility that causes the markets to climb or fall in huge numbers. These swings can often be linked to information released by either a company, the government or caused by some sort of natural or man-made event.
Because of technology, we have real-time connections with people around the world. When it comes to something like the stock market this instantaneous flow of information isn’t necessarily a good thing. A CEO of a company or a governmental figure can say or do something and cause stocks to tank in just a matter of minutes. This knee jerk reaction can cause ordinary investors like you and me to lose the majority of our life savings in the blink of an eye.
National Debt
The National debt is rising at an unsustainable rate and there are no signs of it slowing down anytime soon but it’s not the current debt crisis that concerns me as much as the Unfunded Liabilities that have so many concerned. Unfunded liabilities are things that the government promised to pay for, examples would include government pensions, Social Security and Medicaid. Some estimates have unfunded liabilities ranging from 125 trillion to over 200 trillion dollars.
Not to mention this does not include the fact that it is estimated that the Social Security system is likely to run out of money by the year 2034! Congress needs to deal with this problem right now but having to cut entitlements means not getting reelected so politicians won’t touch it with a ten-foot pole. So instead of throwing some supplies overboard and making the necessary course correction needed to avoid the iceberg, they are just going to run us right into it and deal with the aftermath. The problem is we will be left without a life raft. Don’t worry you will have built your own life raft by then, right?
Cyber Attack
Another growing concern is cyber attacks. As we become more dependent on electricity and computers to carry on with daily life, we become more susceptible to cyber attacks. The fact that most banking is computer-based, makes the stock market and banking systems a prime target for terrorism and attacks from foreign governments.
Preparing For An Economic Crisis or Collapse
There are many steps that can be taken to protect yourself from the short-term and long-term effects of an economic crisis or collapse. Following these guidelines may not fully insulate you from the effects of a full-on collapse but it should take the sting out of it.
The only way to fully insulate yourself from the effects of a full-on collapse is to be 100% self-sufficient and live a significant distance from any large cities or towns. For a select few who have the ability to be in that situation that’s great but for the rest of us who interact with the general public and the modern world, we need to prepare for the effects of a likely collapse.
Start Prepping in General
The more self-sufficient you are the less of an impact the outside world has on your ability to take care of yourself and your family. This means taking steps to improve your general preparedness.
Being prepared by having all of your necessities taken care of like heat, food, water, hygiene, etc. you eliminate that need to panic buy when people are clearing the shelves of the local market. Also, having essential supplies like toothpaste, shampoo, toilet paper, and garbage bags will save needed cash when inflation or hyperinflation start to occur. Buying these essential non-perishable items now will be like money in the bank later when the money in the bank is gone or has lost its value.
Unsure where to start getting prepared? Check out this series of articles I wrote PRACTICAL PREPPING FOR BEGINNERS: A NO-NONSENSE QUICK START GUIDE
Get Your Financial House In Order
One of the most important things you can do financially to prepare is to get out of debt. I know that getting out of debt completely might be impossible, at least in the short term. Many have home mortgages that are years from being paid off but reducing your overall debt will put you into a much better position financially when an economic crisis strikes.
Invest In Gold and Silver
Did you know that the paper money you have in your wallet is a banknote? At one time a banknote represented actual gold and silver held by the bank. This was the case in the US until 1971. After 1971 the value of the money that we hold is dictated by the government that issued it.
Therefore if the money that we have has no backing from physical gold or silver and the dollar takes a huge dip during an economic crisis or collapse the value of your savings will take a hit too. Gold and silver on the other hand almost always increase in value after an economic crisis, especially gold. As with anything the price goes up and down over time but gold and silver are great for diversifying your savings and also preparing for economic troubles.
Learn a Skill or Trade
What do you do for a living? Right now almost everyone that wants a job has a job due to extremely low unemployment rates. The next question is, does that job provide a product or service, of course, it does, right now. Maybe you are an employee or manager of a cell phone store, what do you think will happen when no one can afford to buy expensive cell phones anymore? You need to have a skillset or have a product that people will NEED.
Get And Stay Healthy
Although the exact numbers cannot be decided on, medical debt is one of the top causes of bankruptcy. Taking care of yourself now will pay dividends in the long run. There are three parts to a health preparedness plan; Education, Preventative, and Fitness.
Education covers an array of things from learning about your families medical history to learning what your individual risk factors are. These things will help you with the next thing.
Preventative involves taking care of any medical problems or procedures that you need to get your health back on track. It is best to do these things now while you can afford to, while health care workers aren’t on strike and while the chance of getting caught up in some civil unrest on your way to an appointment is much less likely.
Fitness is last but not least. Fitness is about what you eat and what you do, this means eating healthy and keeping your mind and body strong.
The leading cause of death in the US is heart disease followed closely by cancer. Here is a small list of things you can do to greatly reduce the chances of death from these ailments.
- Eat Healthy Foods
- Get 150 minutes of Exercise a Week
- Maintain a Healthy Body Fat Percentage
- Don’t Smoke
For more information on getting prepper fit, check out this article I wrote: Fitness For Preppers – The Strength To Survive
Learn How to Defend Yourself and Your Home
Personal and home security will be one of your top priorities after an economic collapse. Even a recession will cause an uptick in crime due to unemployment and peoples inability to make ends meet. Where you live now may not have much of a crime problem but after an economic collapse that will likely change. More than likely law enforcement will be overworked, underpaid, and stretched thin.
Even today calling 911 because of a break-in or home invasion, law enforcement will not get there in time to help. After a collapse, civil unrest and crime will only get worse. It will be up to you to take responsibility for protecting your home and family.
Effective Home Defense requires a multilayer approach; Deterrence, Denial, and Interior Defense
The first layer is Deterrence. Have you ever heard the phrase about encountering a bear in the woods – I don’t have to outrun the bear, I just have to outrun YOU! The same applies when protecting your home. You need to make your home less attractive to would-be thieves than other homes in your area.
The next layer is Denial. So if your deterrence tactics didn’t work you need to deny access to the inside of your home. This means reinforcing doors and other access points by using solid doors with reinforced door jambs.
That brings us to the last layer, Interior Defense. Interior defense involves two main components, having the right defensive tools and having a plan.
Final Thoughts
With growing debt, political instability, increased risk of a cyber attack, and an ever more complex economy, the chances of a major economic crisis or all-out collapse grow with each passing day. You can’t ignore history or you will be doomed to repeat it. The more prepared you are the less painful it will be and you will be in a much better position during and after the recovery.