Thursday, February 22, 2024

Have you been doomscrolling through social media or keeping your eyes peeled to the news any time that they start discussing the state of the economy here in Canada right now?  Heck, even if we’re paying attention to it on a global level, it’s no less depressing.  It feels like everywhere we look, someone else is sharing their opinion on whether or not we’re approaching a state of total financial collapse.

Most of us can probably agree that this is a scary thought.  That’s probably an understatement – for me, at least, I know I’m terrified of the prospect.  What will us ordinary consumers do if that happens, right?  How are we going to feed our families, keep a roof over our head, and still find some way to get enjoyment out of life at the same time?

For the most part, it’ll come down to how you prepare for such a situation.  Obviously, I’m not saying that you need to become a doomsday prepper.  Rather, gathering your resources and having some forms of money or stores of wealth to fall back on is what I’m suggesting.  If you want to learn more about how you might be able to do that, make sure to stick around!

How do we Define a “Financial Collapse?”

If you’re not sure what I mean by “collapse,” another way that it’s commonly referred to is as a crisis.  Most governments across the world are concerned about the possibility and have a ton of official documentation surrounding what it could look like and how we can potentially prepare.  Often, they’re published in the wake of or a few years after a collapse does happen, so it allows us to look back with our power of hindsight.

Perhaps that’s what makes them so genuinely helpful in terms of preparation for such an event.  Often, financial experts think back to the crisis that happened back in 2008 – that link I provided above is actually one of those documents that was published a few years after the event.  It can give you an idea of what we can expect from an upcoming crisis, as well as some common pitfalls to avoid, even if it’s from another country.

What are the actual hallmarks of this, though?  One of the biggest factors involved is banks and if they default.  When that happens, we know we’re in for some tough times.  The same can be said for if a large portion of consumers are facing the same thing with their debts.  Prices rising at astronomical rates while the value of the Canadian dollar declines is another.

Does any of this sound familiar?  Obviously, I’m not trying to be alarmist here, but I think it’s important that we recognize the signs that are all around us.  Chances are, we might be seeing another crisis coming up pretty soon, and that’s why it’s going to be so critical to start preparing for it as soon as possible.

How Can We Prepare, then?

With all of this said, you might be getting a little bit nervous right now.  I don’t blame you, and to be honest, getting worried is a very natural reaction.  With enough knowledge and determination, you can overcome anything that the world might throw at you.

One thing that we can be thankful for is the fact that we have a ton of options right at our fingertips when it comes to this stuff.  One very good example can be read from this link https://durhampreciousmetals.com/ which has information on one of the strategies I’ll be covering shortly.  There are a lot more, both online and in person to explore, so feel free to use multiple of them.

Investing

If you are a student or an unemployed individual, that’s okay – there’s a lot of other ways to prepare for the future. A very good one is learning about investing principles and starting an emergency savings fund. When you invest, your goal is to have a safety net in case  unforeseen events happen, you can then liquidate it.

What I’m referring to when I say “investing” is not actually those traditionally thought of methods of doing so.  Instead, when we’re considering that a collapse could potentially occur within the next two-to-three years, it may be a good idea to start considering “liquid” assets.  Some examples of those are of course cash, bank accounts, but also precious metals.

There aren’t that many people whose initial thoughts jump straight to precious metals when this topic is brought up, and I can see why.  For a long time, it seemed like something that was only accessible for the ultra-rich and wealthy in the world.  This just isn’t the case anymore – in fact, I would say that precious metals are more accessible than ever right now.

Additionally, I consider them to be particularly useful for this purpose.  Depending on how you go about investing in them (be it via purchasing coins or bullion that contain the metal), they’re easy to store and to sell when you need quick cash.  However, unlike said cash, they don’t lose value just by sitting there and existing.  Inflation is a real pain, but it can be subverted with something like gold, silver, platinum, or palladium.

Budgeting

Comparatively, I know that this point is much more obvious.  There are tons of self-help articles written about it like the one seen here, and it’s bordering on being a no-brainer.  However, I don’t think that most people are taught how to budget “properly.”  Instead, it’s sort of a loosey-goosey concept that many of us know about and are vaguely aware of but not exactly well-informed on.

Budgets aren’t all about cutting out the things you enjoy in life.  Instead, they exist to help you be able to still enjoy those things in the future without overindulging in the present.  The first step to any good budget is to consider what your current monthly expenses are.  That could include your bills, your rent, and repayments (along with more, of course).

From there, you can factor in other monthly expenses such as groceries and anything that you want to funnel into savings.  Once you do that, it’s a matter of figuring out what’s left from your paychecks.  It’ll be up to you to decide how to utilize that extra cash (if there is any).

Don’t Panic

I know that we’ve discussed a lot of doom and gloom stuff today, but I want to remind you before we conclude that you don’t need to panic right now.  Yes – there is a strong possibility that we’re going to see economic downturns in the coming years.  However, if we manage to keep our wits about us and prepare for it, it doesn’t have to be the end of the world.

It’s stressful, for sure.  Certainly, it’s not something to look forward to.  However, panicking typically doesn’t help.  In fact, it can lead us to making rash decisions that won’t benefit us in the long-term.  Instead, consider some of the recommendations that I’ve made today.  There are plenty of strategies that we can take to get ourselves ready for an event like this, and if we make use of them, things can turn out okay.

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