The Viral Outbreak of 2020 certainly has a lot of people worried about the present. The current contagion that is sweeping the globe is highly infectious, seems to be variably lethal and is doubly frightening since hard-to-detect since carriers can spread the virus for weeks while they are asymptomatic.
The resultant lockdowns, quarantines and other government-mandated interdictions on our private lives have certainly lent everything a dystopian air.
And while optimism is fine we all have serious cause to be worried about the future: At press time, pretty much all non-essential businesses are shut down all around the United States and furthermore many of them are shut down around the world.
Many of these business and the jobs attendant to them will not come back. This situation is the equivalent of a cocked gun in the mouth of our economies, and our leaders are fingering the trigger.
Say what you want about the danger of pathogens; I can assure you that complete economic ruination can cost as many lives if not more.
Too many preppers are prepared for tangible threats while leaving massive gaps in their armor for incorporeal ones like job loss, financial ruin and economic collapse.
In today’s article I will offer my advice for surviving the silently approaching financial pandemic that is going to follow hot on the heels of the viral one.
The Dangers of Economic Collapse
Whatever the other consequences that might occur as a result of this viral pandemic, I can be positive of one thing.
If the government does not steer into this issue, say “damn the torpedoes!” and restart the economy, even if it means letting the most vulnerable people take their chances and see to their own protection, most of us are not going to emerge from our homes with an economy left.
It will, simply, have been cancelled.
For most of us, the entirety of our financial solvency is completely and inextricably linked to our jobs. If we don’t have our job and don’t have paychecks rolling in every week or every two weeks we will only be that much time away from total financial ruin.
Lest you think I’m overselling the magnitude of the problem consider the following: in any but the most dire circumstances (where the level of civilization is rolled back several grades), money is the ultimate resource for obtaining what you need.
If you want to participate in society, money is what will put a roof over your head, either rented or owned. Money is what you will use to pay for your lease or pay down your mortgage.
Money is needed to obtain commodities from the most fundamental to the most advanced, everything from food to clothing to medical care to transportation to weapons.
Since most of us don’t know everything right off the top of our heads and cannot claim to have expertise in every skill set known to man, we use money to pay for the experience and expertise of others in order to solve our problems.
We need money to pay for the things we use to maintain our equipment, everything from that nice shiny truck or SUV sitting in your driveway to a bottle of oil for lubricating your pistol.
No matter how you feel about money, its evils, its virtues and its effect on our society as a whole, it matters not one lick.
What matters is that money will make most problems go away if you have enough of it. If you don’t have enough money you will notice you have more and more problems, and what problems you do have seem to grow larger and larger.
For many people around the world the economic shutdown and subsequent collapse that will result from this viral pandemic will mean the loss of housing, the loss of the ability to provide food and medical care for their families.
For some of you, it probably feels like you have a chunk of ice in your guts right now. It is not time to panic, not yet, but you will need a plan if you want to make it through this thing.
Long-Term Strategies for Coping with an Economic Collapse
Assuming you do not have a job that is collapse-proof, and honestly no job is if the collapse is total enough, you only have a couple of viable strategies for getting through economic collapse intact.
The first way you can accomplish this is by preparing a massive financial nest egg that you can rely on while your income stream has shrunk or completely disappeared.
Think of this as a sort of monetary lifeboat that you can use to pay for all the necessities of life while everyone else is scrambling, ripping open the couch cushions looking for change.
Obviously if you have already lost your job, don’t have any big-ticket assets and don’t have very much in the way of savings this will probably not mean much to you right now.
The other way to prep for an economic collapse is by developing a sort of financial anti-fragility to the loss of primary income.
This is a more complex strategy with more moving parts, but it is one that you can develop easily over time as well as pull off in a hurry if you have to and have the right skills.
This approach means cutting expenses ruthlessly, cultivating and developing secondary skillsets to ensure you can look to other sectors for employment, growing and diversifying your income streams, having side hustle or moonlighting gigs you can turn to and having the chops to live entirely off-grid if required.
You can use either one of these strategies to get yourself through a financial pandemic without getting totally ruined, but the wise prepper will employ both at the same time.
With a healthy financial escape pod and a backup revenue-generating system provided by diversifying your income you will be able to weather the economic avalanche that will flatten people on your left and right.
It may not necessarily be easy, but as the wise ancients knew an ounce of preparation is worth a pound of cure. We will examine the details of both of these approaches in tandem in the following sections.
Building a Nest Egg Worthy of a Prepper
A nest egg for normal, unconcerned people, and a nest egg for a prepper don’t look exactly alike.
Both require money, of course, but a nest egg for a prepper also includes survival necessities, with those necessities being clean water, a good supply of food that can feed your family, household staples, and other small but necessary items that make civilized life worth living.
I will assume that most of my readers and the readers of this site have plenty of those goods in abundance even if they don’t have a substantial amount of money saved. We will fix that.
Saving money is not a big deal. In fact, it is stupid simple. But as we have all learned painfully before just because something is simple does not mean it is easy to do.
Saving correctly means you put back a fraction of everything you earn, any which way you earn it, into a dedicated, untouchable fund or savings account.
The savings account could take many forms, from a simple home safe or strong box to the traditional institutional savings account at your local bank. Both have their advantages and disadvantages.
Savings Accounts: In-Home or Institutional
If you are using an at home piggy bank you will always have control of your money, and it will always be available no matter what happens or how quickly. If you need to pull that cash out right this second it is in your sweaty hands and then in your wallet in no time flat.
Obviously, any large quantity of cash money is vulnerable to discovery, loss, destruction or theft.
Also, money that is sitting in any kind of box is not earning interest, and if your money is not earning enough interest to keep pace with inflation the money you have saved is actually shrinking. Something to think about.
An institutional savings account makes your money almost completely safe from theft (at least up to the amount your banking institution is insured by the federal government), and it will also earn you a return in the form of interest, even if the interest in virtually every savings account is so small it will barely keep pace with inflation and fees if it does that.
The biggest disadvantage to having your money in a savings account is it is no longer in your possession and it is no longer cash money.
You’ll have to go to the bank to access it and they will have to convert it from electronic ones and zeros on a computer into greenbacks, and if you have a sizable savings account there is a very high likelihood that you will not be able to draw it all at once without giving the bank notice.
That’s a major bummer if some disaster, say a viral pandemic, causes a major run on the banks.
Both of these methods have merit and you don’t have to choose one or the other. You can choose to keep a sizable chunk of cash in your home for dire, in-your-face emergencies and the rest of it in a savings account safe and sound in the bank.
This reduces the chances that if you lose one you will lose everything, and also allows you a certain amount of flexibility.
A savvy prepper will be reading the wires daily keeping an eye on the national and world situation reports, so that if they get nervous they can head to the bank before anyone else starts panicking to pull their cash out. Better safe than sorry.
Pay Yourself First!
It is easy enough listen to me blather on about saving and another thing to actually do it, especially if your budget is so tight that you can barely muster a few extra coins for some drive-thru takeout every now and then.
Combine that with a certainty that some unexpected expense will pop up on a weekly or monthly basis, and it can feel outright impossible to get any money put back no matter what you do.
But, no matter who you are and what you do, unless you’re already living in abject destitution (in which case you probably are not reading this article) it is possible for you to save money, even if it is just a few dollars at a time.
Any of us can clip coupons, and look for manufacturer’s rebates and retailer discounts in order to save money on the things we always buy and have to have. But be advised that finding a great rebate on a luxury item is not a justification to buy it.
The other way to save is good, old-fashioned going without, the same thing your great-grandparents likely had to do as just part of this thing we call life. Takeout food, entertainment items, subscriptions, superfluous services, luxuries, name brand goods, the works.
Everybody has something they can do without or downgrade if they’re being honest with themselves, but this requires discipline, and since discipline isn’t cool these days. Most people don’t look into developing it.
But you should look into developing it so you can afford to pay yourself first, and by paying yourself first I mean contribute to your prepping nest egg, either in the form of survival necessities or cash.
No matter how much you have to pinch, no matter how difficult it is and no matter how badly you don’t want to do it remind yourself that you are choosing to in order to armor yourself and your family against future mishap, downturn and disaster.
That is the most effective insurance you can get for the things that matter the most.
How Much Money Should There Be In Your Nest Egg?
The wiseguy answer is as much money as you can afford to save. The answer that is more tangible and actionable for most is an absolute bare minimum of three months worth of all expenses at your current standard of living.
That sounds like a lot of money for some of you. It isn’t, unless you’re living in the freaking Taj Mahal or Buckingham Palace already.
That money will disappear in the blink of an eye, and as we are already learning, it takes hardly anything for the plug to get pulled on your primary source of income.
If all you have is three months’ worth of all expenses saved up and you tighten your belt immediately and drastically, cutting all non-essentials and saving money everywhere you can, you can eke out another month or two.
What you should be striving to do is saving up an entire 6 months to one year of all living expenses at your current standard of living. I mean every nickel’s worth of every expense, everything you need, in your piggy bank.
Talk about a relief! If you lost every cent of income- everything!- you and yours would be A-okay at your current standard of living for 12 months, and significantly longer than that if you instituted emergency rationing and reduction of all expenses.
Saving up that much money takes a significant amount of work, discipline and willpower. You will have to save, scrimp and sacrifice over and over and over again until you get that saved up.
But I will tell you one thing, reader, it is 100% worth it, and is among one of the most practical and actionable preps that any prepper can I obtain in our modern era.
Determining Your Financial Survival Time
Anytime the writing is on the wall that we are heading for a major economic downturn or your primary source of income is in jeopardy, don’t wait for the detonation to happen before you start tightening your belt.
Think of this as a scuba diving exercise where however much money you have in the bank including how many assets you can turn into liquid cash equals how much air you have in your scuba tank.
When you are scuba diving if the air runs out, you drown. During an economic crisis if your money runs out you drown just the same, only figuratively instead of literally.
When scuba diving if you breathe slowly, steadily and evenly you will use less oxygen than if you’re gulping air in a panic. You want to treat your financial air tank the same way. Get your pencil out along with your calculator, then get to work.
You should ruthlessly cut everything, and I do mean everything, that you can that is non-essential. Gym memberships, car payments on additional vehicles, luxury goods, luxury foods, entertainment, subscriptions and even the internet if you do not use the internet for money-making purposes.
Of course all of this does not make much difference if you don’t know exactly how much you need to spend on the things you have to have every month, things like paying for your mortgage or for rent, utilities like water, electricity, gas and sewer.
Paying for groceries, hygiene items, and so on and so forth. That is the real bottom line. That is what it takes to pay for your “life support” as it were.
Next you need to get clear using the same process on things that you pay for that are not strictly essential, but do increase your work efficiency or help you make money easier, things like vehicles.
Once you have cut out all the fat and pork and tallied your expenses, your essential expenses, down to the cent then you can figure out how long you can last with your current financial reserves. From there, you’ll have your budget.
That is how long you can last for the current crisis until your income resumes normal levels. Once you have your budget, stick to it no matter what!
Using Food and Other Preps to Augment Your Finances
It is an easy trap to fall into thinking you only need a big ol’ fat stack of cash and nothing else to survive an economic collapse.
Collating the second and third order effects that will result from an economic collapse is extremely difficult because they will be so widespread and so varied.
One thing people don’t count on is the rising price of goods due to shortages.
Think about it: All of those jobs that went bust and didn’t come back mean that fewer people are going to have the same amount of money they had before.
If they don’t have the money to spend on goods, even true necessities like food, they won’t be buying them.
If they aren’t buying them, the companies that make, ship them and sell them will not be buying, shipping and selling as much.
If there is not as much stuff to go around because manufacturers are out of business, demand has shrunk and so on it stands to reason that there is likely to be shortages on those goods in the aftermath.
If there was a shortage on goods, that means that prices will go up due to scarcity. If prices go up, you really don’t have as much money as you think if you still need to buy those necessities.
The solution to this is to have a ready store of food and all kinds of household goods just like you have cash on hand.
Aside from being a massive comfort since you’ll be able to draw on your own supplies and not be held hostage by the whims of the market, this will augment your savings since you won’t be spending it on those selfsame supplies once you have lost your primary income source.
Your family will doubtlessly appreciate this since their concerning meal times and their general household environment won’t really change at all while everyone else is suffering or does without entirely.
You will also be able to use these items as bargaining chips for people that need them. There is a very real chance they can become currency for other goods, or for favors from other people.
Shouldn’t You Keep Your Survival Stash Intact for Real Disasters?
I know a few preppers that seem to have the idea that eating from and using goods in your survival stash during an economic crisis is a bad idea. I have never heard a convincing explanation of why it is a bad idea, but they keep making the point.
I’ll put it to you this way. If having the rug pulled out from under your nation’s economy and the total loss of income along with the complete collapse of the job market is not an SHTF crisis, I don’t know what is.
As preppers, we are prepping for bad times of all kinds, not just zombie uprisings, mega tsunamis, super volcanoes and nuclear war that seem to be so in vogue with “hobby” preppers.
As far as I’m concerned economic meltdown is a bonafide emergency and disaster and I would draw from my supplies without hesitation if it would help me keep money in my pocket so I can use it to pay for the most essential items and nothing else.
A disaster does not have to be natural to justify taking things from your survival stash. You should not use things from it without reason or purpose, but a man-made event, even one as esoteric as economic collapse and subsequent financial pandemic is as good a reason as any in my opinion.
Becoming Financially Anti-Fragile
For most of us, and I’m defining “us” as my typical readers, people between the ages of 35 and 50, the job market and average career track is not what it was when our parents and grandparents were growing up.
You got a job and stuck with it, or you learned a trade and climbed the ladder of expertise from Apprentice all the way up to Master, and then, no matter which path you chose, you retired one day and rode off into the sunset with a pension and a gold watch.
That was the average experience in America during the middle and later middle part of the 20th century.
I don’t know how much more clearly I can say it: that era’s work norms have been brutally put down with a shotgun behind the woodshed. Hanging all of your financial hopes on a single job in a single sector is not a brilliant move in the 21st century.
Industries come and go, companies that were once pillars of their respective marketplaces collapse seemingly overnight, and entire workforces are cut loose and set adrift when committees, board members and stockholders make the decision to scarf up even more profits by outsourcing their labor overseas.
It is a sandstorm inside a house of mirrors, and protecting yourself from what has become highly tenuous and, oftentimes, fragile employment conditions, regardless of how long you have been there, is a skillset unto itself, one that you must cultivate if you hope to survive in the West.
There are several ways to do this that we will discuss below, but the overall objective is to spread out your sources of income. Think of this like the roots of a tree.
A tree has many roots, some larger and some smaller, that radiate out from the trunk where it disappears beneath the ground.
Altogether, these roots hold up the trunk with great strength, and the tree can survive the loss of a few roots here and there.
If the tree had but a single, large root that went into the ground it would never be as stable, and would furthermore be very vulnerable to destruction.
Have a Side Hustle or Alternate Skillset
One of the single best things you can do in order to insulate yourself from economic downturn and job loss is to have a proper set of second skills, or even your own side hustle you do part-time while employed full-time.
If you work at a tech firm, but you used to pour concrete or were a pipefitter you can perhaps turn to those skills and get a job, even if only on a part-time basis, in one of those sectors once more.
For this reason it is a good idea to never let yourself get too rusty on anything you are good at, and don’t forget your certifications! You never know when they will come in handy.
Or, you might consider making your side hustle your full-time job for the duration of the crisis, especially if it is something that is evergreen, and typically survives economic downturn.
Cutting lawns and landscaping is a good example. Some people who are crafty might make small goods or offer services that save people money.
A good friend of mine once had to turn to making handmade pistol stands during a period of job loss in a bad economy, and did so well at it that it actually became his full-time gig that he continues to this day.
Consider offering handyman services to people in your neighborhood, especially the elderly, infirm or people who lack such skills.
People probably will not be investing in serious home renovations during a time like this, but everyone always needs fences painted, gutters cleaned out, weeds pulled, doors trued and a dozen other small but challenging tasks completed.
Internet-based businesses and money-making ventures can be ideal in times like these since they have so little start-up cost and will not require you to leave your home.
You could do things like writing, consulting, coding and more all from the comfort of your desk chair.
One of the smartest possible plays you can make is to get an education and certification in a field which is considered essential by both the citizenry and the government during times of economic collapse, since money will always seem to continually flow to these sectors right up until the bitter end.
Hands-on medical professions are a great example, as are any jobs working for electrical utility companies, gas companies, power plant operation and similar infrastructure-related jobs.
If you are fortunate enough to be working in a government position, rejoice, since chances are it will be extremely difficult to fire you in the first place.
Passive Income Streams for Peace of Mind
Passive income streams are an excellent way to diversify your earnings, and have the major advantage of working and making you money even when you aren’t working making money, if you catch my drift.
A passive income stream is anything that makes money for you even while you aren’t touching it or working directly on it. This could be something like a blog or website with affiliate links that lead prospective buyers to make purchases that you get a percentage on.
You might have a web store of your own that sells an information-based product behind a paywall. The sky is the limit.
More tangible ways to passively earn income includes things like rental properties, which have many advantages and can in fact make you very wealthy if you know what you are doing, and stick with it.
The only problem with assets like this is if you don’t have the property managed by another company, you will be the one having to take care of the tenants’ complaints about repairs.
Additionally, in times of great economic downturn most renters will stop paying you rent and then you have to go through a lengthy and oftentimes expensive eviction processes. The chances that your property will get torn up or mistreated go up correspondingly in times like this.
Opting Out of Economic Dependency with Homesteading
There is one more thing you could do to help insulate you and your family from a serious economic depression, and that is go off-grid. And I mean really off-grid.
Going off-grid is seen as something of a crown jewel in prepping, the summit that one hopes to achieve one day once you are good enough, experienced enough and financially stable enough to afford the transition.
With a homestead of your own, the right equipment, enough land and the right know-how you can provide pretty much everything you need to survive and also many modern conveniences, including electricity and running water.
People have been doing it pretty much forever, raising animals for their meat, eggs and milk. Growing fruits, vegetables and grains and generally being self-reliant, or at least self-reliant in the context of a small community of people who are genuinely interested in each other’s success and survival.
The more you can provide for yourself through your own labors the less you need other people for, and the less money you need to buy the things you need from other people. This is not a pipe dream, and it is not fantasy
You probably cannot ever truly get completely away from society, not in this era, unless you went to genuinely live like a hermit, because the tax man will always be after you for one thing or another, and will stop at nothing to find you, but you can get rid of your dependency on city utilities, city conveniences and all the rest of it.
The financial pandemic of 2020 is already well underway, hot on the heels of the world’s response to the viral pandemic that led to it.
With business is closing up, many of them folding permanently, and unemployment skyrocketing it is currently a race against time to see if the citizens of the world will come out of their burrows in time to give the global economy desperately needed defibrillation.
If that doesn’t happen in time, or if it fails to work, we may be likely facing the worst depression the world has ever known.
Knowing how to deal with job loss, nearly complete or total loss of income and the subsequent disaster dominoes that are sure to affect your life and the lives of nearly every other citizen will be essential for survival.
Tom Marlowe practically grew up with a gun in his hand, and has held all kinds of jobs in the gun industry: range safety, sales, instruction and consulting, Tom has the experience to help civilian shooters figure out what will work best for them.