Hedging Against America, Prepping, Housing, Etc.

[baconschteam]

I'm worried about the future of America; particularly, the effects of whatever will happen in November. I know that I'm being dramatic, but I'd like to diversify a bit more away from the stock market (currently 90% index funds and 10%bonds). I would like something more tangible. In a sense, I'd like to be a quasi-"prepper", but without guns and food stores.

My first naive thought was gold, and then I checked out what was happening there. Apparently lots of other folks have the same doomsday feeling that I'm feeling, so that's a no-go. I'd really like to buy a house, but the market is still nuts (at least in Central NJ where I am, to be close to family). My wife and I have put a few bids on houses, but even with an all-cash offer over asking price ($210k) there were 20 other offers well above ours. The stock market is hot, the housing market is hot (when others are greedy, grow fearful, etc..). Another idea was to buy a house in Uruguay (a very progressive country where my wife has a lot of family), rent it out, and have a place to move to if we ever needed it.

What are some ideas for decent things to invest in that could be valuable in the unlikely event of the fall of America as we know it?

[solon]

junioroldtimer, is that you?

https://forum.mrmoneymustache.com/investor-alley/welp-i'm-going-to-take-a-stab-at-timing-the-market/

[FLBiker]

We "invested" in dual citizenship with Canada (and moved there).  Honestly, I would have preferred a "less correlated" citizenship, but it was a compromise with DW.  And I've still got my eye on a third one... :)

In terms of our actual investments, though, we haven't changed anything.  Still mostly in USD, still in a market weighted 90/10 index fund portfolio.  I may be pessimistic, but I'm also very, very aware of my capacity to be wrong.  If I had changed my portfolio based on recent events (Trump's election, COVID, Biden's election, Ukraine, Israel) I would have consistently guessed wrong.

[baconschteam]

junioroldtimer, is that you?

https://forum.mrmoneymustache.com/investor-alley/welp-i'm-going-to-take-a-stab-at-timing-the-market/

Thanks for this. Great thread. Read the first few pages and then skipped ahead to see if he ever came back and lolled when I read @GuitarStv write "Maybe he can no longer pay for Internet.  :P"

I probably need to get myself a hobby. I think that's why "house" is an attractive answer to my angst. A house is not really an investment (I know) but it is sort of a hobby.

[maizefolk]

How much would a house in Uruguay cost you and is it something your net worth/investment strategy could absorb without major hiccups?

Of the options you describe, I like that one the most as it is something you have a specific advantage in given your wife's family connections so you wouldn't be competing with every other stressed-and-worried american like you are when looking at home much people have bid up the price of gold, real estate, etc domestically.

And Uruguay might be a nice country to visit more often if you had a place to stay when you visited, no?

[big_owl]

Every "empire" that has ever existed had collapsed at some point so it's a given that the US will suffer the same fate eventually.  Of course, the collapse can last decades, or centuries in the case of Rome.  So trying to prep for some overnight catastrophe is pretty pointless.  If that happens then we're all pretty much screwed.  I guess I'd stockpile toilet paper, rice, bullets, liquor, cigarettes and most.imoortantly...antibiotics.  And I'd move.somewhere rural with a tight knit community and lots of opportunities for hunting. 

A more realistic plan...get rid of all debt. Pay off your mortgage.so they can't take your home from you.  If society collapsed the odds of the city coming for your home because you can't.pay taxes is.pretty.low. 

[franklin4]

junioroldtimer, is that you?

https://forum.mrmoneymustache.com/investor-alley/welp-i'm-going-to-take-a-stab-at-timing-the-market/

Thanks for this. Great thread. Read the first few pages and then skipped ahead to see if he ever came back and lolled when I read @GuitarStv write "Maybe he can no longer pay for Internet.  :P"

I flipped through as well, and saw that after the covid crash he posted that he bought @10% below the original sale price.

[ATtiny85]

A more realistic plan...get rid of all debt. Pay off your mortgage.so they can't take your home from you.  If society collapsed the odds of the city coming for your home because you can't.pay taxes is.pretty.low.

You think a bank would come, but not the city? Seems equally likely/unlikely. But I agree with the sentiment.

Doomsday scenarios for me do not include elections. Neither side concerns me.

I run 4-6 times a week, that’s my prepping. Having endurance opens up a lot of options and opportunities in the case of some civil whatever.

We are in the process of shifting towards a retirement allocation of around 65-70% stocks, with almost all non stocks in a simple intermediate us bond fund.

[Dicey]

Based on a mention, I started watching Prepper Princess on YouTube. Her position on prepping has evolved quite a bit over the years. You could learn a lot from her. I watch mostly for inspiration because she's frugal as hell. Quite the basass!

BTW, I speed it up to 1.25, and it's still easy to follow.

[GilesMM]

Market timing is really difficult. Getting it wrong can mess up all your plans.

[bacchi]

I run 4-6 times a week, that’s my prepping. Having endurance opens up a lot of options and opportunities in the case of some civil whatever.

Rule #1: Cardio. It's more important to run longer than it is to run faster.

[uniwelder]

How much would a house in Uruguay cost you and is it something your net worth/investment strategy could absorb without major hiccups?

Of the options you describe, I like that one the most as it is something you have a specific advantage in given your wife's family connections so you wouldn't be competing with every other stressed-and-worried american like you are when looking at home much people have bid up the price of gold, real estate, etc domestically.

And Uruguay might be a nice country to visit more often if you had a place to stay when you visited, no?

If my wife had family in Uruguay, I'd lean heavily toward buying a house there.  She happens to be from Mexico, and we've seriously discussed buying a house.  I've never visited Uruguay, but I'm always impressed how highly it's ranked on the world democracy index--- #15 in the world!  Right with Canada and well ahead of the US.  Since it's on the other end of the hemisphere, you could stay in the US for 6 months of warmth, then Uruguay for the other 6 months.

Have you looked at the numbers?  Maybe buy a house to rent to family or their friends, that happens to have an extra apartment space for when you want to visit?

[Telecaster]

A more realistic plan...get rid of all debt. Pay off your mortgage.so they can't take your home from you.  If society collapsed the odds of the city coming for your home because you can't.pay taxes is.pretty.low.

If society collapsed how would anyone collect your debt?   Seems like if the end is coming you would want to be running up debt. 

[big_owl]

A more realistic plan...get rid of all debt. Pay off your mortgage.so they can't take your home from you.  If society collapsed the odds of the city coming for your home because you can't.pay taxes is.pretty.low.

If society collapsed how would anyone collect your debt?   Seems like if the end is coming you would want to be running up debt.

Well because the odds of collapse are pretty low it'd be pretty stupid to run up a ton of debt for some low odds scenario. On the other hand, paying off all debt really doesn't have any downsides.

And debt jubilees are pretty rare in historical collapse.  Typically those who own all the debt are in positions of power, or are close friends with those who are in power.  And those people want to get paid and will find creative ways to make sure they get paid.  And you aren't smarter than them.  Best not to play that game. 

[EchoStache]

Many feel that diversifying into international funds is important to account for risk.  Over the years, there have always been periods of time where international equities outperform domestic equities.  The US has significantly outperformed for the last 15 years or so.  Although wise, long term index investors should not market time, it may indeed be a good time to consider international diversification.  Choose your percentage, and decide whether you want total international or just developed markets.  The major brokerage houses(Fidelity, Schwab, Vangaurd) all seem to offer pretty good options.

Just thought it might be something for you to consider, while aligning well with typical conservative, safe, low risk investing principles.

I've been giving a lot of thought to this myself lately.  I'm ~10 years out from retiring.  Maybe a little less.  I'd hate for the next ten years to be a period where international outperforms significantly while I hold 100% FXAIX.

It's not always about acheiving the best possible outcome, but avoiding the worst.

[Askel]

What are some ideas for decent things to invest in that could be valuable in the unlikely event of the fall of America as we know it?

I maintain a diverse portfolio that includes categories for leather fetish gear and cars that go really fast and get really shitty gas mileage.  That way I can rule the post-apocalyptic wasteland as Lord Humongous. 

[FINate]

A lot of this seems like generalized anxiety. Like, some bad shit may happen in the future and I have a need for some semblance of control.

Here's the thing, you have very little, if any, control over what happens in the wide world. If OP is 35 (per profile) then if everything goes well in life they may have another 45 years or so on this planet. But there's a pretty good chance they die of some other cause before then: cancer, heart attack, car crash, etc. So stop worrying, accept your mortality, and live your life. I live in Idaho, the land of preppers, and I find it quite sad that these folks are so busy spending their life energy planning for some unknown future catastrophe that they aren't actually living life.

Besides, if things really do hit the fan how it all actually unfolds will be entirely unpredictable. Prepping has been a thing for a while now (since Y2K at least)... did the preppers weather the pandemic better than everyone else? Maybe they had more toilet paper, but the fact is they were also hit with loss of work, a strained medical system, and so on. Because we all live in a highly connected society and depend on each other.

And as someone who spends a fair amount of time hunting and fishing, I'll add that if society truly collapses and people start hunting en mass, w/o regulations or limits, all the wildlife will be essentially wiped out within 6-12 months. There simply isn't that much living in the wild relative to the human population. If we ever get to that point the most abundant creature in the forest will be humans... cannibalism isn't unheard of in past cataclysms.

If you're making big life decisions based on fear of what may happen in the future, IMO you're far better off investing your time and energy with a therapist.

[Metalcat]

My DH worked for years in public safety in Canada assessing emergency preparedness for just about every scenario including a zombie apocalypse, yes, we have an official zombie apocalypse emergency model in Canada because it's a great model for testing the resiliency of a region.

What I've come to understand is that the range of possibilities and types of fallout are just too broad to plan for, and they can change radically over time. You might prep really well for one specific kind of emergency for the early stages of it, and then be fucked for what happens a year down the line.

"Society" is a very, very complex system and changing variables within a complex system is tremendously hard to predict, especially on any kind of longer time scale.

The most resilient thing you can do to hedge against societal upheaval to have a lot of really great and diverse social connections and to stay useful in a variety of scenarios.

Wealth is determined by social constructs, so you can't really effectively protect your wealth when the social construct fabric gets damaged. There are just too many ways that just about any store of value could drop within a complex, global economic system if it erodes.

There are SO MANY scenarios where gold would essentially be useless.

This simple fact is that if the fabric of society starts coming apart, it's a silly goal to try and preserve the value you accrued within that system. A hell of a lot of folks more powerful than you will be trying to do the same thing and be way more successful at it at your expense.

You could prioritize paying off that property so that "they" can't take it, but "they" can take whatever they want. The "they" in a social collapse scenario can expropriate, imprison, etc, however "they" please, whoever the fuck "they" ends up being, depending on the scenario.

Maybe you spend a fortune on a bunker, gold and silver, guns, and non perishable food only for your area to get forcefully evacuated or become unlivable. And that one bag you're allowed to bring with you to the FEMA evacuation site might get you killed if it's full of gold bars.

Literally any scenario you can possibly think of, the hedge for it is also an liability in another, equally plausible scenario.

DH always says that the best hedge against the collapse of society is to live a life without regrets. But when pushed on this, we both concluded that the best hedge is to maintain skills that make you useful in a variety of scenarios, and to maintain really good friendships with a diverse population of people with a diverse range of useful skills and assets.

Basically, live a really rich life full of valuable learning and meaningfully human connection with a diversity of friendships, and your life with be pretty awesome while society is still stable, and you will be maximally hedged of/when that stability erodes.

And as FINate just said, therapy is your best friend for any scenario, because nothing in this life will help you handle more challenging situations than emotional resilience.

[Dicey]

^Mic drop^

[Fru-Gal]

Amen @Dicey @Metalcat !

I run 4-6 times a week, that’s my prepping. Having endurance opens up a lot of options and opportunities in the case of some civil whatever.

The above is my approach. Having outdoors skills and being fit seem to be neglected topics by preppers. If you live in North America you have the benefit of a huge amount of wilderness to access. But mainly I always think if you can’t run 10 miles and hike 20 you have no business claiming to be prepared for anything.

[Metalcat]

Amen @Dicey @Metalcat !

I run 4-6 times a week, that’s my prepping. Having endurance opens up a lot of options and opportunities in the case of some civil whatever.

The above is my approach. Having outdoors skills and being fit seem to be neglected topics by preppers. If you live in North America you have the benefit of a huge amount of wilderness to access. But mainly I always think if you can’t run 10 miles and hike 20 you have no business claiming to be prepared for anything.

Again, I would say that this is quite relevant in a set of circumstances, but in others having high end technical skills would be more valuable than literally being able to physically run.

But yeah, being able bodied will always be an advantage, like it already is in almost every arena of life and place in the world, but speaking as someone who can barely walk, there are many, many other abilities that could come in handy in an enormous range of societal breakdown scenarios.

The peppers tend to limit their imagined societal breakdown scenarios to the ones that require them to stay put, eat shelf stable foods, and defend their property/stash with munitions.

Literally ANY outcome that forces them to relocate and relinquish weapons is essentially unaccounted for and deemed improbable because, well, they have guns, or some dumb fucking logic like that.

[FINate]

I don't see what running 20-30 miles into the wilderness accomplishes outside a few short term scenarios. The vast wildness of the US is such for a reason: people tried to settle it and failed because these areas are not very habitable. Poor soil, lack of water, long harsh winters, difficult transportation. So you run into the mountains, then what? The chances of surviving the first winter are approximately zero with sub 0F temperatures and no food. I just don't see how this is a meaningful plan.

If history is our guide, a collapse of nation states would very likely devolve into something like the city states of old ruled by local warlords. Basically the most ruthlessly pragmatic sociopaths running the show. Cities would be the locus of power because they have concentrations of manpower and materiel. Rural areas would be contested territory, and valued primarily for their agricultural output necessary to support a city's militia. No place would be safe, but rural communities would be far worse, with people forced to work the fields (similar to collective farms of the USSR) and/or being battlegrounds between competing city states. Per Metalcat's comments, this is but one possible scenario, but I think it's the most likely. All these fantasies of surviving in the wilderness are just that, fantasies based on the myth of rugged individualism... it's just not plausible in the real world.

[uniwelder]

I think this conversation is getting a bit far out from where OP considers themself in regards to prepping for a decline of the US.  My impression is diversifying investments into more international funds, real estate investment outside the US, and potentially move to another country if the US finally really loses its sanity.  I think things were on point earlier on, but I don't think all this talk about more wacky prepping really helps constructively.

Being selfish, I'd really like to hear more about Uruguay!  I've been reading up more about the country in the past day and it sounds like a fantastic expat retirement destination, regardless of whether someone wants to flee the US or just visit for a few months at a time.

[Fru-Gal]

History has shown again and again that in the event of collapse the number one thing humans do is evacuate/emigrate. Tons of people crossed the Alps on foot to get away from the Nazi regime. Just a few years ago in Venezuela people walked with their children and everything they could stuff in their day packs to get away from that failing regime. Having an escape route and a way to smuggle your treasure if you have any (I believe there was a famous example of a family escaping the Nazis that smuggled palladium or something as coat hangers) is paramount.

To @Malcat ‘s point there’s always this crazy idea of staying and fighting or becoming a warlord. Personally I believe we are so lucky in North America to have so much space and diversity. It’s more likely you could emigrate to a better area with a more favorable situation right within our continent. Hence my point of preferring fitness and evacuation skills over weapons, heavy items and bunkers. And it seems to me almost no “prepper” type ever seems to want to do the really hard stuff which is be fit to carry all their shit to a safer area (Uruguay?!). Again, which is what humans have always done.

My other favorite idea is sailing away. But I don’t have sailing skills.

Personally I can’t think of a better place to be in the world than North America. I definitely believe in having emergency food/water/supplies on hand in your home, of course.

[Metalcat]

History has shown again and again that in the event of collapse the number one thing humans do is evacuate/emigrate. Tons of people crossed the Alps on foot to get away from the Nazi regime. Just a few years ago in Venezuela people walked with their children and everything they could stuff in their day packs to get away from that failing regime. Having an escape route and a way to smuggle your treasure if you have any (I believe there was a famous example of a family escaping the Nazis that smuggled palladium or something as coat hangers) is paramount.

To @Malcat ‘s point there’s always this crazy idea of staying and fighting or becoming a warlord. Personally I believe we are so lucky in North America to have so much space and diversity. It’s more likely you could emigrate to a better area with a more favorable situation right within our continent. Hence my point of preferring fitness and evacuation skills over weapons, heavy items and bunkers. And it seems to me almost no “prepper” type ever seems to want to do the really hard stuff which is be fit to carry all their shit to a safer area (Uruguay?!). Again, which is what humans have always done.

My other favorite idea is sailing away. But I don’t have sailing skills.

Personally I can’t think of a better place to be in the world than North America. I definitely believe in having emergency food/water/supplies on hand in your home, of course.

Yep. The ability to leave where you are is so, so much more robust than the ability to stay put in the majority of circumstances.

[blue_green_sparks]

My ex-boss retired and purchased an underground missile silo on hundreds of acres of land and had it converted into a really nice home. He was convinced that the collapse of civilization was eminent (six years ago.) The right-wing radio finally got to him.

Me, I just stock up on some extra drinking water and canned goods each hurricane season. I am more worried about cyclones than I am about "The Teflon Don". Sucks that my presidential vote will not get counted, but the quiet moderates are out there in large numbers and will thwart any attempts to install a dictatorship. There were some real heroes the first time and they were not all Democrats either.

[blueberrybushes]

Figure out what people will want in times of crisis.  If you expect inflation to go nuts like some SA countries, buy non-perishable goods now, hold onto, and sell at a profit (aka "gouge") in the future.  Think Toilet Paper like during the pandemic.  How long would 1 million rolls of TP last and how much per roll??

You could also do what my step-grandfather did - bury your money in the ground so no one can steal.  A couple of problems with this "investment" strategy though - you gotta remember where you buried it and you gotta live long enough to dig it up.  he died without telling anyone.  :(

[RunningintoFI]

I do think it is hard to compare the collapse of the American empire to many historical empire collapses.  Most notably, the technology of today does not mirror the technology of the Roman empire time. When Rome collapsed, citizens had the same weaponry as the nation-state as a whole - swords and pikes vs swords and pikes.  Today, America has nuclear weapons and some awfully advanced military technology that would make a collapse much more complicated.  It's one thing for chaos and uprisings when the military has muskets and so do the common folk.  It's a whole other ball-game when there are tanks, helicopters, drones and so on going against small arms. 

[uniwelder]

It’s more likely you could emigrate to a better area with a more favorable situation right within our continent. Hence my point of preferring fitness and evacuation skills over weapons, heavy items and bunkers. And it seems to me almost no “prepper” type ever seems to want to do the really hard stuff which is be fit to carry all their shit to a safer area (Uruguay?!). Again, which is what humans have always done.

If I felt I needed to leave the US, I doubt I'd be walking (maybe cycling?) to Canada, which is 600 miles away at its closest point.  I'd likely just hop on a flight and head to my wife's family in Mexico.  This is assuming we're not talking about doomsday prepper scenarios.  If I were OP and had family in Uruguay, why doesn't it seem reasonable to go there?  Based on everything I'm reading, it sounds like Uruguay is a fantastic place for a number of reasons---- 

1) all their energy is green and self reliant (either hydro or wind)
2) scores higher than the US in terms of income equality, democracy, and safety
3) very green country, mild weather, lots of beaches, relaxed atmosphere
4) tax friendly toward expats and lower cost of living
5) European culture (and population-- they apparently killed off the remaining small indigenous population 200 years ago, much like the US)
6) universal healthcare, ranked higher than US

[blue_green_sparks]

Amen @Dicey @Metalcat !

I run 4-6 times a week, that’s my prepping. Having endurance opens up a lot of options and opportunities in the case of some civil whatever.

The above is my approach. Having outdoors skills and being fit seem to be neglected topics by preppers. If you live in North America you have the benefit of a huge amount of wilderness to access. But mainly I always think if you can’t run 10 miles and hike 20 you have no business claiming to be prepared for anything.

These posts remind of an old reggae song, "jogging" about keeping fit for armageddon.
https://www.youtube.com/watch?v=cbXVFce-laY

[baconschteam]

How much would a house in Uruguay cost you and is it something your net worth/investment strategy could absorb without major hiccups?

Of the options you describe, I like that one the most as it is something you have a specific advantage in given your wife's family connections so you wouldn't be competing with every other stressed-and-worried american like you are when looking at home much people have bid up the price of gold, real estate, etc domestically.

And Uruguay might be a nice country to visit more often if you had a place to stay when you visited, no?

Yeah, we visited with her father this year and really fell in love with the country and the people there and her family made us feel so welcome. It's a very friendly place, socialist-leaning, lots of punks. We fantasize about living there for part of the year (winter here is summer there). As far as pricing goes, we could probably get a nice multi-unit property in a decent and walkable part of the city for $200k-$300k. I'm still figuring out how it could work. I would probably have to pay with cash, so it would tie up an unacceptable amount of our current stash (a bit over $400k), which means it's just a fantasy for now. We would like to figure out a way to make this work in the future. We love it there.

[baconschteam]

Many feel that diversifying into international funds is important to account for risk.  Over the years, there have always been periods of time where international equities outperform domestic equities.  The US has significantly outperformed for the last 15 years or so.  Although wise, long term index investors should not market time, it may indeed be a good time to consider international diversification.  Choose your percentage, and decide whether you want total international or just developed markets.  The major brokerage houses(Fidelity, Schwab, Vangaurd) all seem to offer pretty good options.

Just thought it might be something for you to consider, while aligning well with typical conservative, safe, low risk investing principles.

I've been giving a lot of thought to this myself lately.  I'm ~10 years out from retiring.  Maybe a little less.  I'd hate for the next ten years to be a period where international outperforms significantly while I hold 100% FXAIX.

It's not always about acheiving the best possible outcome, but avoiding the worst.

I do have 5% of funds in VTIAX (Vanguard International Fund). It has been sad to watch, but I'm still holding it.

[baconschteam]

It’s more likely you could emigrate to a better area with a more favorable situation right within our continent. Hence my point of preferring fitness and evacuation skills over weapons, heavy items and bunkers. And it seems to me almost no “prepper” type ever seems to want to do the really hard stuff which is be fit to carry all their shit to a safer area (Uruguay?!). Again, which is what humans have always done.

If I felt I needed to leave the US, I doubt I'd be walking (maybe cycling?) to Canada, which is 600 miles away at its closest point.  I'd likely just hop on a flight and head to my wife's family in Mexico.  This is assuming we're not talking about doomsday prepper scenarios.  If I were OP and had family in Uruguay, why doesn't it seem reasonable to go there?  Based on everything I'm reading, it sounds like Uruguay is a fantastic place for a number of reasons---- 

1) all their energy is green and self reliant (either hydro or wind)
2) scores higher than the US in terms of income equality, democracy, and safety
3) very green country, mild weather, lots of beaches, relaxed atmosphere
4) tax friendly toward expats and lower cost of living
5) European culture (and population-- they apparently killed off the remaining small indigenous population 200 years ago, much like the US)
6) universal healthcare, ranked higher than US

Yeah, it's really nice there!! We love it. There's an app called Mercado Libre that's a little like their Craigslist if you want to check out property or anything. We might switch gears in a couple of years to a remote work coast FIRE strategy, at which point we could become somewhat nomadic and live in Uruguay for part of the year.

[baconschteam]

A lot of this seems like generalized anxiety. Like, some bad shit may happen in the future and I have a need for some semblance of control.

Here's the thing, you have very little, if any, control over what happens in the wide world. If OP is 35 (per profile) then if everything goes well in life they may have another 45 years or so on this planet. But there's a pretty good chance they die of some other cause before then: cancer, heart attack, car crash, etc. So stop worrying, accept your mortality, and live your life. I live in Idaho, the land of preppers, and I find it quite sad that these folks are so busy spending their life energy planning for some unknown future catastrophe that they aren't actually living life.

Besides, if things really do hit the fan how it all actually unfolds will be entirely unpredictable. Prepping has been a thing for a while now (since Y2K at least)... did the preppers weather the pandemic better than everyone else? Maybe they had more toilet paper, but the fact is they were also hit with loss of work, a strained medical system, and so on. Because we all live in a highly connected society and depend on each other.

And as someone who spends a fair amount of time hunting and fishing, I'll add that if society truly collapses and people start hunting en mass, w/o regulations or limits, all the wildlife will be essentially wiped out within 6-12 months. There simply isn't that much living in the wild relative to the human population. If we ever get to that point the most abundant creature in the forest will be humans... cannibalism isn't unheard of in past cataclysms.

If you're making big life decisions based on fear of what may happen in the future, IMO you're far better off investing your time and energy with a therapist.

I've had a hard time finding a therapist. But perhaps trying harder at this would be a worthy direction for my energy.

[baconschteam]

My DH worked for years in public safety in Canada assessing emergency preparedness for just about every scenario including a zombie apocalypse, yes, we have an official zombie apocalypse emergency model in Canada because it's a great model for testing the resiliency of a region.

What I've come to understand is that the range of possibilities and types of fallout are just too broad to plan for, and they can change radically over time. You might prep really well for one specific kind of emergency for the early stages of it, and then be fucked for what happens a year down the line.

"Society" is a very, very complex system and changing variables within a complex system is tremendously hard to predict, especially on any kind of longer time scale.

The most resilient thing you can do to hedge against societal upheaval to have a lot of really great and diverse social connections and to stay useful in a variety of scenarios.

Wealth is determined by social constructs, so you can't really effectively protect your wealth when the social construct fabric gets damaged. There are just too many ways that just about any store of value could drop within a complex, global economic system if it erodes.

There are SO MANY scenarios where gold would essentially be useless.

This simple fact is that if the fabric of society starts coming apart, it's a silly goal to try and preserve the value you accrued within that system. A hell of a lot of folks more powerful than you will be trying to do the same thing and be way more successful at it at your expense.

You could prioritize paying off that property so that "they" can't take it, but "they" can take whatever they want. The "they" in a social collapse scenario can expropriate, imprison, etc, however "they" please, whoever the fuck "they" ends up being, depending on the scenario.

Maybe you spend a fortune on a bunker, gold and silver, guns, and non perishable food only for your area to get forcefully evacuated or become unlivable. And that one bag you're allowed to bring with you to the FEMA evacuation site might get you killed if it's full of gold bars.

Literally any scenario you can possibly think of, the hedge for it is also an liability in another, equally plausible scenario.

DH always says that the best hedge against the collapse of society is to live a life without regrets. But when pushed on this, we both concluded that the best hedge is to maintain skills that make you useful in a variety of scenarios, and to maintain really good friendships with a diverse population of people with a diverse range of useful skills and assets.

Basically, live a really rich life full of valuable learning and meaningfully human connection with a diversity of friendships, and your life with be pretty awesome while society is still stable, and you will be maximally hedged of/when that stability erodes.

And as FINate just said, therapy is your best friend for any scenario, because nothing in this life will help you handle more challenging situations than emotional resilience.

Thanks for this, love the message. Invest in people. Word.

[Radagast]

There's a booklet on this: Deep Risk by William Bernstein (my favorite DIY investment writer). https://www.amazon.com/Deep-Risk-History-Portfolio-Investing/dp/0988780313 Short, but covers all the bases in some depth. Basically divides SHTF cases into 4 categories: devastation, confiscation, inflation, and deflation. Concludes inflation is the most likely by far and has the lowest negative consequences for hedging, so most effort should be put into that. Also concedes a condo in a foreign country might be worth it for the first two. He likes bonds in any case, so that takes care of deflation.

Personally I have 50% of stocks in international funds.

[Dicey]

Based on a mention here, I started watching Prepper Princess on YouTube. Her position on prepping has evolved quite a bit over the years. You could learn a lot from her. I watch mostly for inspiration because she's frugal as hell. Quite the badass!

BTW, I speed it up to 1.25, and it's still easy to follow.

I think she has another post on this topic, but this one covers a lot of it: https://www.youtube.com/watch?v=k2DZ8ml8z1E

[SilentC]

Many feel that diversifying into international funds is important to account for risk.  Over the years, there have always been periods of time where international equities outperform domestic equities.  The US has significantly outperformed for the last 15 years or so.  Although wise, long term index investors should not market time, it may indeed be a good time to consider international diversification.  Choose your percentage, and decide whether you want total international or just developed markets.  The major brokerage houses(Fidelity, Schwab, Vangaurd) all seem to offer pretty good options.

Just thought it might be something for you to consider, while aligning well with typical conservative, safe, low risk investing principles.

I've been giving a lot of thought to this myself lately.  I'm ~10 years out from retiring.  Maybe a little less.  I'd hate for the next ten years to be a period where international outperforms significantly while I hold 100% FXAIX.

It's not always about acheiving the best possible outcome, but avoiding the worst.

I do have 5% of funds in VTIAX (Vanguard International Fund). It has been sad to watch, but I'm still holding it.

Just curious, why is gold not an option but being 85% invested in crowded US stocks ok?  I think the short term rise in gold prices might look startling but US large cap has had a golden decade of crushing basically all other asset classes (maybe not highly levered residential real estate) and outperforming its long term trend significantly?  (Edit, not trying to preach, trying to better understand psychology)

[maizefolk]

Yeah, we visited with her father this year and really fell in love with the country and the people there and her family made us feel so welcome. It's a very friendly place, socialist-leaning, lots of punks. We fantasize about living there for part of the year (winter here is summer there). As far as pricing goes, we could probably get a nice multi-unit property in a decent and walkable part of the city for $200k-$300k. I'm still figuring out how it could work. I would probably have to pay with cash, so it would tie up an unacceptable amount of our current stash (a bit over $400k), which means it's just a fantasy for now. We would like to figure out a way to make this work in the future. We love it there.

Then don't put off finding a way to make it work too long. Finding a place that makes you happy (and perhaps lets you feel more secure/less anxious) is worth a lot in quality of life. Could you, for example, purchase a single unit property instead of a multi-unit? Or is there any way to get a loan within the country? Since Uruguay's inflation is around 10%/year my guess is that the interest rates look scary high but the effective interest rate if you're paying off in dollars that you convert to pesos may be much more reasonable.

[baconschteam]

Yeah, we visited with her father this year and really fell in love with the country and the people there and her family made us feel so welcome. It's a very friendly place, socialist-leaning, lots of punks. We fantasize about living there for part of the year (winter here is summer there). As far as pricing goes, we could probably get a nice multi-unit property in a decent and walkable part of the city for $200k-$300k. I'm still figuring out how it could work. I would probably have to pay with cash, so it would tie up an unacceptable amount of our current stash (a bit over $400k), which means it's just a fantasy for now. We would like to figure out a way to make this work in the future. We love it there.

Then don't put off finding a way to make it work too long. Finding a place that makes you happy (and perhaps lets you feel more secure/less anxious) is worth a lot in quality of life. Could you, for example, purchase a single unit property instead of a multi-unit? Or is there any way to get a loan within the country? Since Uruguay's inflation is around 10%/year my guess is that the interest rates look scary high but the effective interest rate if you're paying off in dollars that you convert to pesos may be much more reasonable.

My wife's father would probably be willing to invest with us. He's got $80k that's sort of stuck down there (he doesn't want to pay American taxes on it or something, I don't really understand), so that would make things easier. Here's an example of a multi-unit building in a pretty good spot: https://acsa.com.uy/propiedad/venta-de-edificio-en-centro-montevideo-22069. This is listed for $280k and (supposedly) generates close to $30k per year in rent (haven't done deeper math regarding actual cashflow), so it seems like there could be some good investments to be found. With this example, we would keep the commercial space and one unit rented, while AirBnB hosting the other one when we are not there (maybe one of my wife's cousins would like to be paid to tend to it). I'll start taking a look at some single unit properties also. I have to figure out what the tax implications would be or any other complications to move money made down there to the US.

A lot of the listings are not super detailed with the photos, but a lot of these old buildings have nice decks on the roof with a parrilla (large brick BBQ), sort of an outdoor kitchen and hang out space.

[baconschteam]

To do a roundup, good ideas for alternative investments include:

- Therapy; invest in emotional resilience, find healthy ways to deal with anxiety and stop worrying about this question
- Cardio; gain health and stamina
- Diverse and deep social connections
- Invest in some basic self-reliance (a la Prepper Princess)
- Possibly a small position in international funds
- Maaaaybe an investment property in a nice country that I have a connection to?
- I'll just add here that we bought ourselves some really nice pots and pans and we LOVE to cook on them EVERY DAY.

[ChpBstrd]

• WTF would you want to buy a house if you think a period of economic and social decline might be ahead? First, you're tying up your down payment, and you need those resources. Second, your attempts to sell that house instead of getting out could be the thing that keeps you in a bad situation just a little too long. Third, houses get a lot cheaper than $200k in chaotic or declining countries. We can debate the merits of various strategies but it's hard to envision a decline scenario where home ownership in the declining place would be a good idea. A 20% down payment on an American house right now could sustain you for a couple of years in most of Latin America or the Caribbean. More importantly, it's a lot easier to flee from a lease than an owned house, and that reluctance could kill you.
• I'll second the folks earlier who said invest in getting physically fit. Think through having to march long distances, perform hard physical labor to obtain necessities, not being intimidated, going for the next several years without medical care or medicine, etc. The collapse of America is no time to have diabetes. Also, toughen up. Eat raw veggies. Go without AC. Walk to work.
• WRT investments, I suggest we think about scenarios like what the people of Turkyie' went through under Erdogan (75% inflation this year) or Venezuela or Russia. Perhaps when you sense things starting to go bad, it's time to set up a foreign bank account. The tax accounting will be a horrible experience, but you'll have a quick and easy pathway to wire yourself money abroad and to do currency conversions. A collapse in the value of the US dollar is what you're really hedging against. Moving some assets into Euros, Yen, Australian dollars, Chilean pesos, etc. could help diversify before anything goes wrong. Or, here's a list of currency-hedged ETFs: https://etfdb.com/etfs/investment-style/currency-hedged/
• Learn the skills that will help you survive and prosper, like a couple of foreign languages. Your application for asylum in Germany or Spain will go a lot further if you have a basic ability to use their languages. Your ability to survive injuries or help others will be greatly enhanced by a few nights spent stitching orange peels together. It's critical to understand how to transfer money abroad, how passports, green cards, and immigration systems work, and how not to get ripped off in money transfers. Sure, firearms training can't hurt, but don't be like the dumbass Gravy Seals and think national decline is some Rambo movie that they're going to thrive in when they can barely tie their shoes. 
• Should you have at least a month's worth of dry beans/rice/lentils, canned foods, and medications on hand at any given time? Yes. Should you have at least $2,000 hidden in your home? Yes. Should you keep your passport up to date and your car's gas tank above 25%? Obviously. Should you understand how to drain your home's plumbing in a winter power outage or to fix a flat tire? Certainly. But do not mistake these little actions for a plan. These activities will only buy you enough time to execute a plan, such as fleeing the country, relocating within the country, enduring a short economic crisis, waiting out riots, etc. Eventually your supplies and cash run out and by that time you should have already been doing something else.
• Another barrier to executing a plan is the people you care about. Probably countless Russian draftees whose corpses are rotting in Ukraine right now missed the chance to exit the country because they had friends, family, and reluctant spouses. The people who survived WW2 for example, were the ones willing to cut ties - even if temporarily - to promptly get themselves and their families away from the epicenter of chaos. Venezuelan migrants who made it to the US are probably doing better than those who stayed behind. It is reasonable to expect that you'll have a month or two of lead time to take decisive action, at best. You better have a specific plan agreed upon with whomever will be going with you, and to frequently discuss contingency planning with them.
• The best plans for this scenario might be easily reversible. E.g. "I'll spend a year living in Italy like an Italian to have fun and see how things work out." This makes it easier to commit to the plan in the first place. Tell friends it's a sabbatical, and they'll be envious instead of critical about your overreaction. Then you can save face upon returning if the crisis blows over. By not committing, you're more likely to take prompt action before it's too late.
• Having LESS stuff is one of your best prepper moves. The last thing you want to be doing if democracy is overthrown, the US dollar is collapsing, and riots are in the streets is to be burdened with expensive cars, furniture, electronics, sentimental treasures, etc. Make a plan to convert these burdens into cash as you leave. Pawn the valuables. Sell the car to a friend or neighbor for half of its value. Be ready to trash or donate the rest - your furniture, kitchen items, excess clothing, excess toiletries, cleaning items, small appliances, etc.
• If you are considering fleeing the country, think very hard about the paradox of living in a relatively cheap place like Latin America, Thailand, the Philippines, much of the Caribbean, or Vietnam, as opposed to an expensive place like Australia, most of Europe, Canada, etc. Everyone imagines themselves re-creating their American lifestyle in one of the expensive places, but the reality is that you'd be burning cash at a scary pace trying to get established and trying to obtain an income amid an economic crisis. The clock would tick a lot slower in a cheap place, even if you'd already lost much of your purchasing power to the move, bribes, theft, or the economic crisis.
• Think through realistic and specific scenarios, and use historical back-testing to think about the best move forward. I.e. if the U.S. form of government became fascism, would it be best to cut back spending and hunker down or emigrate a continent away? If the U.S. currency collapsed in value, what kinds of investments would you want to be in? In the event of a civil war, would you stay or flee the risk of being drafted? In the event of a nuclear war, how would you want to prepare? What if economic decline is a slow, grinding process as it was in Turkyie', Egypt, Russia, and Argentina at various different times? How can you tell if a bout of instability is temporary, as it was recently in Ecuador? You'll realize there is no one plan - rather a series of plans - and that you'll have to abandon a lot of the planning you make for scenario A if scenario B happens instead. E.g. your backyard fallout shelter with all its canned goods and iodine pills gets left behind in the event of a genocidal dictatorship taking over.
• You can also plan incremental steps triggered by specific measurements. For example, if X happens, I'll move $50,000 into a Euro-denominated account. If Y happens, I'll start selling personal posessions.

[Fru-Gal]

Love your list here and how you’ve condensed the thread to some takeaways!

Here’s another thought: Isn’t risk tolerance a key to growing uninherited wealth? So your ability to ride out storms, stock market drops, etc… —within reason of course, and with backup plans. And on this forum we’ve discussed a million ways to be reasonable about risks.

But there’s a lot of clickbait and rage bait and FUD out there designed to make one question the reasonable paths to wealth the FIRE movement counsels people to follow.

The pandemic gives us a perfect, recent example of calamity. And how did we come out of it? Millions died, but vaccines and new treatments were perfected, UBI was deployed, no one starved to death, tons of businesses found new ways to operate, the stock market dropped then soared. Online education was forever changed and many online schools began to absolutely thrive. Remote work caused a vast reduction in pollution. Etc.

It’s interesting how the same voices who fought common-sense measures to control Covid now pivot to some other question of risk as if we didn’t actually survive that and learn from it.

As Mr. Rogers always said, “Look for the helpers.”

Congrats on your new pots and pans!

[former player]

Amen @Dicey @Metalcat !

I run 4-6 times a week, that’s my prepping. Having endurance opens up a lot of options and opportunities in the case of some civil whatever.

The above is my approach. Having outdoors skills and being fit seem to be neglected topics by preppers. If you live in North America you have the benefit of a huge amount of wilderness to access. But mainly I always think if you can’t run 10 miles and hike 20 you have no business claiming to be prepared for anything.

These posts remind of an old reggae song, "jogging" about keeping fit for armageddon.
https://www.youtube.com/watch?v=cbXVFce-laY

Less work to become a cobbler, and survive by mending the shoes of the people doing all that walking and running.

[former player]

Starting with the caveat that I think we've probably got at least another couple of decades before things get bug-out bad in rich Western democracies, and by then most of us will be too old to go anywhere much unless it's in the slipstream of younger, fitter, family who are willing to put up with the burden.

Collapse will happen sooner in almost everywhere else in the world.  It's already started in some parts (no-one is going on holiday to the Saharan belt at the moment, are they?), and the associated human migrations are gathering pace.  By the time collapse happens in the USA a lot of the places people think they'll want to get to will be in as bad or worse a condition, and if not will have been overwhelmed with migrants for a decade or more and their borders will be closed.  If even 1% of Americans want to move that's 35 million people.  You will not be welcome.

Better to stay where you are and put your energies into delaying the collapse of the USA.

ETA: 35M is 10%, of course.  1% or less is probably more typically the bug-out brigade. Most people who are forced to move for systemic reasons become displaced persons within their owm country.  Of the refugees who leave, most stay in neighbouring countries for reasons of cost, ties of culture and language, and the difficulty of keeping them out.  Only a very small percentage make longer journeys, and these are usually the relatively economically advantaged (they are never the poorest of the poor, who can't afford to move far) looking for further economic advantage.

[blue_green_sparks]

Love your list here and how you’ve condensed the thread to some takeaways!

Here’s another thought: Isn’t risk tolerance a key to growing uninherited wealth? So your ability to ride out storms, stock market drops, etc… —within reason of course, and with backup plans. And on this forum we’ve discussed a million ways to be reasonable about risks.

But there’s a lot of clickbait and rage bait and FUD out there designed to make one question the reasonable paths to wealth the FIRE movement counsels people to follow.

The pandemic gives us a perfect, recent example of calamity. And how did we come out of it? Millions died, but vaccines and new treatments were perfected, UBI was deployed, no one starved to death, tons of businesses found new ways to operate, the stock market dropped then soared. Online education was forever changed and many online schools began to absolutely thrive. Remote work caused a vast reduction in pollution. Etc.

It’s interesting how the same voices who fought common-sense measures to control Covid now pivot to some other question of risk as if we didn’t actually survive that and learn from it.

As Mr. Rogers always said, “Look for the helpers.”

Congrats on your new pots and pans!

It’s interesting how the same voices who fought common-sense measures to control Covid now pivot to some other question of risk as if we didn’t actually survive that and learn from it.

I agree experts learned much from the Covid pandemic, however here in the US at least, I would argue that because of all the misinformation spread by various grifters, the public would be even less able to handle a new pandemic than before.

[baconschteam]

Love your list here and how you’ve condensed the thread to some takeaways!

Here’s another thought: Isn’t risk tolerance a key to growing uninherited wealth? So your ability to ride out storms, stock market drops, etc… —within reason of course, and with backup plans. And on this forum we’ve discussed a million ways to be reasonable about risks.

But there’s a lot of clickbait and rage bait and FUD out there designed to make one question the reasonable paths to wealth the FIRE movement counsels people to follow.

The pandemic gives us a perfect, recent example of calamity. And how did we come out of it? Millions died, but vaccines and new treatments were perfected, UBI was deployed, no one starved to death, tons of businesses found new ways to operate, the stock market dropped then soared. Online education was forever changed and many online schools began to absolutely thrive. Remote work caused a vast reduction in pollution. Etc.

It’s interesting how the same voices who fought common-sense measures to control Covid now pivot to some other question of risk as if we didn’t actually survive that and learn from it.

As Mr. Rogers always said, “Look for the helpers.”

Congrats on your new pots and pans!

It’s interesting how the same voices who fought common-sense measures to control Covid now pivot to some other question of risk as if we didn’t actually survive that and learn from it.

I agree experts learned much from the Covid pandemic, however here in the US at least, I would argue that because of all the misinformation spread by various grifters, the public would be even less able to handle a new pandemic than before.

Also even just mixed and wrong info from the institutions that were actually supposed to know what to do. Confidence in our institutions is totally shot.

[baconschteam]

Yeah, we visited with her father this year and really fell in love with the country and the people there and her family made us feel so welcome. It's a very friendly place, socialist-leaning, lots of punks. We fantasize about living there for part of the year (winter here is summer there). As far as pricing goes, we could probably get a nice multi-unit property in a decent and walkable part of the city for $200k-$300k. I'm still figuring out how it could work. I would probably have to pay with cash, so it would tie up an unacceptable amount of our current stash (a bit over $400k), which means it's just a fantasy for now. We would like to figure out a way to make this work in the future. We love it there.

Then don't put off finding a way to make it work too long. Finding a place that makes you happy (and perhaps lets you feel more secure/less anxious) is worth a lot in quality of life. Could you, for example, purchase a single unit property instead of a multi-unit? Or is there any way to get a loan within the country? Since Uruguay's inflation is around 10%/year my guess is that the interest rates look scary high but the effective interest rate if you're paying off in dollars that you convert to pesos may be much more reasonable.

My wife's father would probably be willing to invest with us. He's got $80k that's sort of stuck down there (he doesn't want to pay American taxes on it or something, I don't really understand), so that would make things easier. Here's an example of a multi-unit building in a pretty good spot: https://acsa.com.uy/propiedad/venta-de-edificio-en-centro-montevideo-22069. This is listed for $280k and (supposedly) generates close to $30k per year in rent (haven't done deeper math regarding actual cashflow), so it seems like there could be some good investments to be found. With this example, we would keep the commercial space and one unit rented, while AirBnB hosting the other one when we are not there (maybe one of my wife's cousins would like to be paid to tend to it). I'll start taking a look at some single unit properties also. I have to figure out what the tax implications would be or any other complications to move money made down there to the US.

A lot of the listings are not super detailed with the photos, but a lot of these old buildings have nice decks on the roof with a parrilla (large brick BBQ), sort of an outdoor kitchen and hang out space.

Though I suppose an 11% return, before expenses, with a 10% inflation rate, is pretty lousy. I would actually have to do something clever to find a good investment in Montevideo, which would likely be much easier if/when we learn Spanish.

[GilesMM]

Just like climate variability is growing with global warming, I expect financial variability to rise beyond a tipping point.  AI and Cybercrime will be the drivers.  They will drive the markets to wild new highs, then lead to spectacular collapses.   Well before climate gets out of control: in the next 3-5 years.

[maizefolk]

I suspect you'd find that in an environment with ~10% inflation, rents are increasing about 10% per year and the value of homes is also increasing about 10% per year. So in peso terms your return might look more like 21% nominal (11% of the value of the home in rent + 10% appreciation).