Wealth Preservation

Wealth preservation is a tactic used throughout the centuries during extremely uncertain economic times.

The more unstable the economic times, the more wealth should be kept outside of the financial system.

As a currency collapses due to hyperinflation (caused by massive currency debasing ) it is critical to proactively employ asset protection.

In other words, to hold onto your hard earned net worth (acquired over a lifetime) you must find relatively safe havens for your assets (during an economic storm) so you aren’t wiped out financially.

Today we are in uncertain economic times (heading towards extreme). The United States and every major country on the planet use a fiat monetary system. A fiat currency is backed by nothing but a population’s faith in the reining government.


US Currency Devaluation
Over time the US has devalued the dollar dramatically. Public works, social programs, excessive wars and a culture that has an eroding work ethic has put this country on an unsustainable economic trajectory.

The future of United States Currency Devaluation is unwritten, but facts and data indicate that hyperinflation is lurking around the corner. Consider the following:

It is not that public works and social programs don’t have their place. They do. But there is currently a huge chasm between providing a safety net for people in real need, and turning this (or any other country) into another failed welfare state.

Like bad cooks politicians can never seem to figure out the correct mixture of using money wisely, coupled with fair and just regulation to:

• Help people who work hard to have the opportunity to prosper if they do a good job, and fail if they don’t—but still have an opportunity to pick themselves up and try again.

• Provide adequate food, shelter, housing, and medical assistance for the very young, the very old, the very sick and the very crippled.

• Not leak huge sums of monies to the growing number of freeloaders.

• Not leak huge sums of moneys to political corruption.


This is the primary problem and danger of a fiat money system. The US government has the power to print unlimited monies and provide a sense of prosperity for awhile and to increase its centralized power base.

Excessive currency creation (especially of this magnitude) almost always (if not always) leads to waste, corruption, and debasement of the currency.

Over time this debasement accelerates (as it has done here). The greater the debasement, the more dire the consequences when the piper is finally paid.

In other words, inflation and eventual hyperinflation are the hangover effects of the poorly run multi-decade party.

Owning Gold and Silver for Wealth Preservation
Throughout history owning gold and silver have been a primary source of wealth preservation.

There are many reasons that gold and silver have been the most common items used for asset protection during highly uncertain economic times. Gold and silver:

• Are rare, useful, precious and highly sought after for many millennia.

• Are easily divisible, transportable and the purity can be readily determined.

• Have many industrial uses (especially silver).

• Have a high desirability for jewelry and status.

• The desire for gold and silver is engrained in all cultures and the psyche of people in general. This desirability is almost engrained in our DNA.


The current prices of gold and silver (early 2012) are relatively low in comparison to what they would be if we had a commodity backed system. To learn more see: Gold Bubble Myth.

Putting a relatively small percentage of your net worth into gold and silver can be a tough concept to wrap your head around. I know it was for me.

Gold and silver are metals that just sit there. You can’t use them for food, clothing, shelter or to power your car. Gold and silver don’t grow or shrink in size like companies (think stocks and bonds).

Putting a certain percentage of money in these hard non-changing (physical size) assets may seem foreign. However, unstable times means changing ones frame of reference and thinking out of the box to provide the right mindset to be financially wise.

Think of it this way. Ownership of gold and silver is not usually part of an investment plan during stable economic times—or for minor inflation protection.

It is however a good wealth preservation investment for unstable economic times (like today in the US—and around the world) where there is a strong possibility of hyperinflation in the not so distant future.

If goods and services hyper-inflate the value of your currently will drop dramatically. More and more currency will be needed to buy the same goods and services.

For example, if food prices hyper-inflated by 50% over the next year, what cost you $100 in groceries today will cost $150 in a year. Your income probably won’t go correspondingly.

What happens if other goods and services increase in price significantly as well?

Wage increases almost always trail inflation and hyperinflation. This puts a huge financial burden on consumers. People must work harder and longer just to keep up and their lifestyles suffer accordingly.

You may already have noticed that some goods and services have increased significantly in price over the past couple of years. Not everything increases in price (inflates) uniformly.

Gold and silver will fluctuate up and down, but when the smoke has cleared from the financial mess we are in, these hard assets will be one the best forms of wealth protection available (if history is a reliable guide—and it usually is).

Look at it this way, do you think gold and silver will be worth significantly more dollars in the next 3-5 years because of the current economic problems? If so, consider the option of using them for wealth preservation.


Gold and Silver Coins


Prospering Significantly
If you own enough gold and silver there is potential for large gains if hyperinflation occurs. If the economy tanks there will be a fire sale on many items. Those who have enough disposable real money (like gold and silver) will be in a position to prosper significantly.

To learn more about owning precious metals for wealth preservation see buy and sell gold and silver.


Final Thoughts on Wealth Preservation
See:

The Ten Commandments for Buying Gold and Silver for the right mix of gold and silver and other great thoughts on owning these precious metals.

Besides using gold and silver for wealth preservation there are other methods of asset protection that will be explored throughout this website.

Tools, techniques and resources are also provided to help you button down the hatches and protect your wealth as well as increase your opportunities to prosper during these tough economic times.


“The farther backward you can look, the farther forward
you are likely to see.” ~ Winston Churchill

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