Going into debt to secure your future
So, this is something that I've been thinking about recently and I couldn't think of a better place to ask for advice than here. As of this moment, the only debt that I have is my school loan, which is really only a small monthly payment that unless things get really crazy, I should be able to continue paying. Over the past 18 months, I've eliminated all credit card debt and also paid my auto loan off 11 months early. The reason that I did this is because I didn't want to pay the interest anymore and I felt that it was the best option for me. That said, I'm quite curious what others might have to say regarding going into debt (whatever amount) to secure our futures. I am considering the option of using credit to purchase things of real value (ie: precious metals, food, supplies, a house/houses, etc. etc.) . My reasoning behind this is that from my perspective, and I believe from the perspectives of most people here, inflation is inevitable considering the current policies of borrowing, printing and deficit spending amounting to trillions and trillions of dollars. Hyperinflation is a real possibility.
So, I guess my question is, what is the argument against going into debt to purchase items which *should* drastically increase in value (in terms of Federal Reserve Notes) over the next several years? I'm not the smartest guy in the world, but it seems like people who have borrowed to purchase items of value, even if they have no way of paying the money back as things currently stand will benefit in the future when the values of those items rise far beyond the original purchase prices.
Please enlighten me. Also, let me know if any clarification is needed. At this moment in time, I've made small investments in PM's and am planning on preparing for the S to HTF in other ways as well.
Rule #1
Never go into debt to buy bullion (either silver or gold).
If you're debt free, start building an emergency fund.
Also, another terrific investment is knowledge (food preservation, gardening, survival etc.) which *never* decreases in value.
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"Let the good heart speak words of true peace, not inciting others to further war." -- B.I.S.
hmmm
sounds like a bad idea.
I really appreciate the
I really appreciate the responses. I'm lucky to be in the situation that I'm in and able to begin preparing for the worst here and there with the money that I earn through my job and poker. I'm far from comfortable, but it feels great to be basically debt free right now. I have a long way to go to be prepared for a complete economic meltdown, but I'm getting there little by little, and I know I'm miles ahead of the average American. It's so great to have a place like the DP to come to for advice and where people are actually awake to reality.
I'm not planning to go into debt to prepare, but it was just something that had crossed my mind a few times due to my belief that inflation is likely going to be so extreme in the next few years. I definitely understand that it would be a big gamble though and it does make more sense to just do what I can and not have to worry about paying back my master.
“Liberty means responsibility. That is why most men dread it.” -George Bernard Shaw
If you are an honorable person, debt weighs on you
Even if you are making your payments, even if the purchase was wise, even if every cent can be justified and rationalized - debt weighs upon you.
We were debt free for a few months when we were young. It was fabulous. I doubt I will get there again in this life, due to winding up with 2 mortgages NOT by my choice. I moved right before the housing crash and right before I woke up. Timing may not be everything, but it is a big thing.
Truth exists, and it deserves to be cherished.
Get out of debt completely
You're that close. Get it done, and don't go back in. Don't cancel the credit cards, but keep them at zero. Have the credit around in case of extreme emergency.
Start investing in airtight storage containers and a storage area. Then start stocking up on dry goods and non-perishables. Get yourself a good large chest deep freezer and a membership at your local CSA, and a good Excalibur deyhdrator, then put them to use. Use your extra funds to build a food and supply reserve. Make sure you have a solid set of base tools: wrenches, screwdrivers, hammer, T-square, sockets, power saw, reciprocating saw, jigsaw, multi-speed power drill, pipe wrenches, pliers, clamps. Make sure your firearms are in full operation with plenty of ammunition and supplies for cleaning and spare parts. Make sure your vehicle is in good repair, find the Chilton's for it and buy it and READ it.
That's a start.
Excellent Advice
You are very wise.
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"Let the good heart speak words of true peace, not inciting others to further war." -- B.I.S.
Get Out
I am expending every resource that I have to get out of debt (except for home mortgage - which is okay in my opinion).
As GOD said...
"The Borrower Is Slave To The Lender."
Is slavery secure?
As long as your master decides to continue keeping you alive.
Fellow Veterans, This Is A Call To Arms!
http://www.facebook.com/events/192677970828185/
February 20, 2012 - Veterans For Ron Paul March on D.C.!
This is what our government is doing...
so, I think that I will do just the opposite.
Exactly...
What right would you have to criticize the federal governments spending and debt...when you are doing the same thing in your personal life?
“Let a man never stir on his road a step without his weapons of war; for unsure is the knowing when need shall arise of a spear on the way without.” - Odin
Fellow Veterans, This Is A Call To Arms!
http://www.facebook.com/events/192677970828185/
February 20, 2012 - Veterans For Ron Paul March on D.C.!
Except that when you are doing it, you are deciding what
to buy. When the gov't does it, they are deciding what to buy with your money.
I have debated with myself
I have debated with myself over this topic too. It does appear that those who hold debt and are also in the position to continue paying on it under hyperinflation have an advantage over the savers. But, those who would be unable to make payments might lose their property. One would have to have a reliable plan for their continued income. I found a lot of insight in this article about the Weimar Republic: The Nightmare German Inflation by Scientific Market Analysis, 1970 http://www.usagold.com/germannightmare.html
Bad Idea
Dont use debt to buy metals with... you are just betting at that point. If you have real capital to transfer into some other thing like metals that is great but do not use debt. We have no idea what will happen in the future to prices.. inflation is a theory and yet to prove itself... so far deflation has won the day. if you had gone into debt 6 months ago to buy "things" you would be in an ugly hole.
Use cash or capital not debt.
The question is: If you were already in BIG debt, would you ....
go into MORE debt to secure your future? Does that makes sense to you?
I have come to the
I have come to the conclusion that all debt is bad. It starts here:
As long as you have payments you need to make, you are a slave. Further, this statement bothers me:
This is exactly what people said during the housing bubble because it seemed that houses could only ever go up in value. No investment is a sure thing. The fact is that every time you take a loan, you are taking a risk. If you are wrong, you find yourself a slave. If, however, you only spend from what you have in hand, if the investment turns sour, you still own what remains. You owe no one anything. This is, to me, one of the key definitions of freedom.
I hear where you're coming
I hear where you're coming from, but at the same time, considering current monetary policy, what is the more likely scenario?
A.) In 5 years precious metals, homes and food cost twice as much as they do now.
B.) In 5 years precious metals, homes and food cost half as much as they do now.
The borrower is going to "own the rich" if he borrows wisely and the things that he purchases on credit rise in value to the point that he can sell half of what he purchased to pay off his debt.
“Liberty means responsibility. That is why most men dread it.” -George Bernard Shaw
take homes out and I think
take homes out and I think you are right.. the housing market will not recover for a long time.
"When governments fear the people there is liberty. When the people fear the government there is tyranny."
-Thomas Jefferson
I am more concerned about the return of my money than the return on my money. --Mark Twain
“A prudent man foreseeth the evil, and hideth himself: but the simple pass on, and are punished.” (Prov. 22:3; 27:12 KJV)
Hey McCain-----┌П┐(◣_◢)┌П┐
Think it over again
Don't count on large gains in value as I am SURE this has been taken into the CON MENS game plan...They will love to get you in debt to suddenly increase productivity afterwords...BE carefull .You are entering a new & on your own economy..Your healthcare is going to skyrocket to pay for eveyone's medicare & SSI, which they may make almost worthless to our generation....WE are the chosen generation of PATSIES...Remember food & maintanance for yourself is going to increase dramaticly, so cash on hand may be better than in the bush ...Health care & insurance will be at a premium...OH yes, you will not get FREE healthcare...I would only invest in those things( assets )that help boost what you have now...
.you-no
But what if in 6 months, the
But what if in 6 months, the banks call in their loans and due to manipulation, your assets have not risen in value? You are still betting against the banks and their ability to manipulate the market as well as your own ability to hold onto those assets in the meantime. If you should for whatever reason be unable to pay back your loan, you become their slave.
Kicker on hand
You can always hand them the EMPTY lockbox..
you-no