How to Prepare for the Depression

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By Pillain
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(7 Ratings)

It's time to prepare for an economic depression. No need for forecasts or prophecy, it's already in motion. The economy is in free fall and denial will only increase the chances that you will be unprepared for what is our likely future. So buckle up and get ready for a bumpy ride.

Difficulty: Challenging

Instructions

Things You'll Need:

optimism
determination
resourcefulness

Step 1

First things first, we are not talking about the end of the world. Total chaos and a return to the stone age is not an economic depression. What an economic depression does involve is an increase in unemployment, food and materials shortages, lower prices (deflation) or higher prices (inflation), increased frequency of wars, riots, increase in property crimes and an increase in the homeless population.
Step 2

Keep a cash reserve and eliminate all debt. Yes, this is easier said than done. But ideally, you would be able to live on savings while unemployed for one year. Carrying debt will only increase your cash outflow by paying interest. If you can pay off your mortgage, then do so immediately if you intend to live in your home for at least the next five years. If you live in a state where banks are not allowed deficiency judgments on mortgages, then you may want to hold onto your cash and walk away from your home if you are underwater on your mortgage. It's a complicated decision, but one that needs to be made. Seek the advice of professionals.
Step 3

Invest in yourself. You may end up losing your job, life savings, and all material possessions in the next economic depression, but you will still have yourself, i.e. your body, mind and spirit. Get yourself in shape and become healthy. Go see your doctor to get a physical and annual check up. See your dentist. Start exercising to strengthen your body. With the economy in shambles, there may be few jobs available for information systems analysts and more jobs available for laborers and tradesmen.
Step 4

Maintain a close network. Now is not the time to be a lone ranger. Having family and friends to call on can make all the difference in the world. Before text messaging, iPods and bottled water were deemed essential, people lived in communities where they knew their neighbors and shared resources. They helped each other at a time when there were no 911 responders, internet doctors or Dr. Phils.
Step 5

Stock up on non-perishable food, toilet paper, medicines and other necessities. There are many reasons for stocking essentials. You may become unemployed, lose your income, inflation may drive up prices dramatically, disruptions in distribution can delay shipments, farm failures can lead to shortages, and fuel shortages can impact many areas including transportation and production. Standing in lines for hours to buy a loaf of bread could be the next reality. Also, consider stocking up on liquor and cigarettes. Not just to maintain your own supply, but also to keep items that can be used in barter as such items are often in short supply and very popular in depressed economies.
Step 6

Keep your powder dry. I hate to say it, but don't expect everyone to be nice and orderly like those old black and white pictures of people in soup lines from the 1930's. If you haven't already done so, learn to embrace the second amendment and be prepared to defend your home and family if the need arises. The police will be under funded, under staffed and over worked. Make sure your gun is operational and keep enough ammo in reserve. Don't put this off. The country is already experiencing an acute ammunition shortage. Also, do yourself a favor and keep quiet about your supply of food, whisky, cigarettes and ammunition.
Step 7

This is maybe the most important step. Think positive. Keep your spirits high. Prepare for the worst, but hope for the best. No matter what happens, know for yourself that you will overcome and that better days lie ahead. And if you have your health, then really, you do have everything.

Comments

aew4 said

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on 1/27/2009 Also, I'd advise you to keep a container of gasonline in your garage (if you have a car). Gas shortages also accompany depressions, and you might need to fill up your car in an emergency. Good tips about investing in yourself as well. 5*

kaytay said

on 1/19/2009 Very good advice. 5 stars and a recommend!

veryirie said

on 12/10/2008 Your article's subject is not something anyone can ignore these days, so it's helpful to read your thoughts on how to prepare for the Depression. Thanks for a well done article!