Letter Re: Fiscal Fitness

Dear Jim,
I’m an avid SurvivalBlog reader and I want to thank you for your insights and the valuable information you provide on the Blog. I purchased the “Rawles Gets You Ready” preparedness course and have enjoyed reading and studying it. Lately, it occurred to me that, along with all of the necessary planning that accompanies retreat preparation, as well as the recently discussed benefits of physical fitness, proper fiscal fitness is also crucial in completing these vital preparations. Most of us have to work for an income in order to live in our modern society, at least while we prepare for more difficult times. At the same time, we have many “money intensive” demands on that same income – raising children, mortgages, utility bills, paying for educations, and a biggie for many, consumer debt with its attendant costs. These demands likely leave little available money for hobbies or for large scale disaster preparedness.
I have found a very reasonable set of principles that have helped me, together with my wife and our children, to get on the path to systematically walk out of debt. I’m referring to the financial principles set forth by Dave Ramsey. He has a national radio show that is also broadcast on XM. Perhaps best of all for newcomers, he archives the most recent two weeks of his radio show on his web site. Folks new to this program can listen in on the advice he has given to many callers and decide for themselves if they can understand and accept the principles he teaches. Those principles include spending less than you make and using your income as your greatest wealth-building tool. Obviously, most who call in to his radio show are already living beyond their means, so he discusses principles with them to get them walking out of debt. You may have several readers who have become financially hamstrung and could use a simple, straight-forward plan to help them back to financial solvency. The bottom line is that the path to financial peace involves taking responsibility for your past fiscal mistakes, taking a good honest look at what comes in and where it goes, and making a plan (the dreaded budget). Who of us would attempt to prepare a retreat that would shelter us and our loved ones from disaster without a plan? It’s no different with finances. Many of us are experiencing a SHTF scenario right now – the weekly money fight with the spouse! It’s well-documented that money fights and money problems are major marriage killers. Well, let me tell you, I had a good marriage before I started this plan. Our marriage is so much better now that my wife and I are working together and are in agreement on where the money goes. Yes, I even have “blow money” for my “Preparation hobby” even while we’re climbing out of debt – we just put it in the budget!
I won’t ramble on much longer. I just know what a difference this has made in my life. I’ve probably changed my family’s future by living these principles and teaching them to my children. I didn’t need to become Donald Trump. I just needed to get a fiscal plan in place so that later we would have the money available for Preparation, rather than sending it to a myriad of creditors. Dave Ramsey’s program has helped me in my preparations for the future. Dave’s not selling any funds, stocks, or mystery programs to beat the Market or buy real estate with no money down. He’s just packaged up time-honored principles that have helped us, and many friends, achieve financial peace as well as greater love and harmony in our marriage and family. In my estimation, when we speak and write about disaster preparedness, we’re really talking about peace and security through the hardest times. It’s pretty tough to do that without including financial peace in the discussion. – Rob in NC

JWR Replies: I agree that getting out of debt should be a priority. In the long term (decades), further inflation in the U.S. seems inevitable. The good news is that continuing inflation means paying off debts with progressively “cheaper” dollars, but the bad news is that our buying power is being eroded. This is particularly painful for fixed income pensioners. In the short term, however, there is the lingering risk of a deflationary depression–much like the Great Depression of the 1930s. If that happens, anyone with any significant debt will be fortunate not to end up homeless by the end of that deflationary cycle.

Once folks have extricated themselves from the debt hole, I recommend an investment portfolio that is heavy on precious metals–primarily bullion rather than numismatic. See the Swiss America web site for some “hard money” investing alternatives.