Many of those attracted to precious metals talk a lot about Doomsday. Doomsday scenarios come in many forms: A crash of the dollar and ensuing hyperinflation, a widespread economic depression, a banking collapse, a large-scale terrorist attack, a natural disaster, World War III, alien invasion, the plague, you name it. When it happens, as the power grid goes down or the Internet dies or some other such calamity occurs, the idea is that we should all be holding gold.
It’s almost comical. Hollywood loves all of these scenarios and everyone flocks to see the latest Doomsday movie. But those of us who appreciate the true value of gold – we actually prepare for them.
That said, when many of us try to explain to our family and friends exactly what we’re preparing for, many often roll their eyes and ask where our tinfoil hat is.
So let’s take an honest moment of reflection and ask: Are we really doing all this prep work for nothing? How likely are any of these things to really happen? And will they happen in two years or 20? Or 200 years?
Here’s the reality: For the 3.5 million Americans who are considered long-term unemployed, and the roughly 5 million families who have lost their homes since 2008, their personal apocalypse has already happened. In fact, it is maybe still happening all around them. Think about it: If you lose your job and your house – all your financial stability – the crisis is already here. Do you have a plan? And then a backup plan for that?
We talk a lot about the proximity of a major, widespread crisis that would affect everybody. But let’s consider only ourselves. Ask yourself: How close might I be to a crisis that affects just me? What are the odds that my job is outsourced to China? Or that my company gets bought out and I get “reorganized” out the front door? Or what if my CEO gets investigated, the company is fined a gazillion dollars and it’s ME who ends up with the pink slip?
Any number of things could happen to your job that are well beyond your control, yet not beyond your foresight. Don’t get put in a position where you run through three months of savings in a market where job hunts average one year or longer. Just as bad: Don’t let your one year of savings get inflated down to three months!
God forbid! It’s horrible to think about. It’s less horrible, however, if you’ve thought about a plan for worst case scenarios.
What if you end up in foreclosure and your credit is trashed? It will be years before you get a mortgage again. By the point of foreclosure, though, you have probably already run through your savings, sold all of your dollar and paper assets, of course. Did any of that really net you any gain after inflation and taxes? Should you depend on dollar-based assets entirely?
The markets are going up, down and sideways these days. Are all of your assets going with it?
We wouldn’t suggest that all your savings be in precious metals, certainly not. But we do whole-heartedly advocate diversification; none of us need to be financial advisors to know the value of a well-rounded portfolio.
Precious metals, especially gold, tend to move counter to the market and hedge against the ravages of inflation. A solid portfolio is one in which the owner has taken these glaring risks into consideration and has formulated a plan for them. Gold can be part of that plan.
Think about your future self at 3am the night after a layoff notice has come. How do you feel about the gold you do or do not have in your portfolio?
Remember, for a crisis to be a crisis for YOU, it doesn’t need to be the widespread zombie apocalypse, Doomsday-type scenario. In this economy, apocalypses have happened and will continue to happen for one family at a time until the powers that be figure out a way to get back on track. Talk about unlikely scenarios! We certainly hope your personal doomsday isn’t next, but you never know. And that’s exactly what gold can help protect against: the unknown.
Our clients hear us say it a lot: It’s better to be a year early than a day late. If you want to take the first step towards safeguarding your family’s future, click here for free information to learn more or give us a call today.