One of the most disturbing things I have had to do recently is to figure out how to protect what little money I have. I have my 401k and my rollover IRA account as does my wife. Like most people we have checking and savings and not that much of either. Fortunately our debt is low but at our age we really need to hang on to what we have. Most Americans have suffered tremendously in the stock market and even conservative Mutual Funds have been big losers at least twice in the past 10 years. In the last month the DOW has dropped about 1,000 points which basically puts us back to where we were a year ago. So you might ask yourself how this affect you and what should you do.
Well I am neither investor nor broker and have no special knowledge. What I do know is that everything I read says that the American dollar is in jeopardy. I suspect that those who frequent this blog probably already intuitively suspect this but what to do. Well it seems that the big kids, the ones with lots and lots of money, the ones who made like $5million last year (right Barry), these people have advisers. Who do you have? If you are like me you have the words of someone on the other end of the phone if that. That being the case I have come up with an investment strategy. It may sound silly but I only invest in sure fire winners. That should get your attention.
Who does the grocery shopping in your house? Ask them what has gone up the most in the last year. If those things have a shelf life of months or years, stock up. Figure it this way. Let’s say you love applesauce and that you eat a jar a month. If the expiration date is months or a year away and you find it on special I buy it. I buy about 75% of what I think I can use. Worst case scenario is that I will lose my job and end up eating applesauce for breakfast, lunch, and dinner. Even if the price goes down will it be worse that my stocks. I doubt it.
Now I gave a very simple example here because no one family would match the needs of others. What you see as something of value may not meet another’s needs. My rule is I have to eat it, need it, or be able to sell or trade it to someone else. I guess in a way you could call me an urban survivalist. Don’t get me wrong, I am not preparing for Armageddon here but I’m not denying the possibility either. Now my son sells guns and ammunition where he works. For more than a year now people have been hoarding ammunition. I asked him about the reason for this and he really doesn’t know. Reasons stated are fear of unavailability later to fears of increase in crime. I thought it over and reasoned that owning some is better that none.
Other things I buy are Paper Towels, Tylenol or Generics, Bath and Laundry soaps, toilet paper, and Spam. My kids love to make fun that I have a half-dozen cans of Spam. They hate the stuff. I like it and it has a shelf life of a couple of years. Now I buy all of these things on sale. If it isn’t a good price I don’t buy it. This is not about spending, it is about saving. I am buying things at a good price now that I think will be higher later. If you look around you I’ll bet you can find a few things that will stretch your dollar. With little or no pay raise in sight, Congress on a spending spree, and the World’s economies collapsing it might just be worth a little thought. If you come up with a good idea perhaps you would share it with the rest of us. Just in case you are wondering, I have enough toilet paper to make it past Halloween and still TP a couple of houses.
Oh yeah. The closest thing to cash in a 401K is a CD. I don't make much but I probably won't lose unless America goes under. I may change my mind after I am out of toilet paper 'cause I expect to outlast Congress.