We're in crisis mode. How to cope...

[Atash Hagmahani]

Most of you at least sort of saw this coming, and/or have personalities that are naturally frugal and cautious. Good show.

A few folks, for various reasons, got caught in the debt-trap. Stay calm. Soon enough the value of your debt will erode dramatically--along with the value of any savings any of us have denominated in dollars!

The problem is trying to stay solvent between now and then--especially with income opportunities choking off and unemployment rising.

I don't think there are any easy answers. Here are some suggestions to get started:

1. It's easier to cut expenses than it is to find more income. Keep in mind the principle of "chaos"--small differences in initial conditions create huge differences downstream. In other words, small improvements in your cash flow can have huge benefits over time. It's not just the accumulated savings, it's the difference that having more money versus having less money makes at critical junctures. It can cost money and opportunity to be broke!

2. You diversify income streams for the same reason that you diversify your investments: to cut risk. If you have only a single income stream--wages from a single job--then you are at more risk of losing your entire income. Multiple streams of income can come from any of multiple possible sources:

* multiple jobs (among one or more wage-earners)
* microbusinesses (eg, selling something you make as a hobby, on eBay)
* renting out something you own (not just housing. We made a small income stream renting out a cello)
* dividends (THESE ARE TYPICALLY TAXED AT LOWER RATES THAN WAGE INCOME!)

3. To pay off debts: start either with the one that has the highest interest payment, or the smallest. Get one debt paid off. Apply the income stream that was paying it off, to the next debt. Keep doing this until all paid off.

4. If something costs money to own, net, sell it. Pay off debt, or invest the proceeds into something that generates income. Re-arrange your life to generate fewer expenses and more income.

5. Double or triple up.

6. Find jobs for teenage or adult children living with you. Counsel them on not being too proud to take menial jobs. I seem to recall that one of the big-name physicists got his start as a stevedor on port of Long Beach or something like that.

7. If you grow it or make it yourself, you're not taxed on the new benefit. Think carefully about this.

8. Use it up, wear it out, make it do, or do without.

9. De-stress. Accept life's challenges as they are. It's what makes life interesting. Every evening before you go to sleep, relax your mind, and appreciate the beauty of it all.

[hancocs]

I'm selling my house and just about everything it and I have my car up for sale. I have ran the numbers of living on about 40 foot boat and I will be cutting my living expensive in half. This works for me because I'm single. I will be living with alot less but it will be worht it to get out of debt.

[oscar615]

And a boat might make a good bugout vehicle..  At least if it is moored on a river or the sea.

[The Future]

uhhh bugout to where?

[hancocs]

Somewhere besides the US

[Ryder]

How about the ability to pull away from major population centers for a couple of months.......plus if you have a sailboat it might even work if there is a EMP attack. If the weather modification guys don't make the wind suck instead of blow.

[oscar615]

Yes away from the city.  You could go up the coast to some little cove and stay for awhile, move to the next place.  Out to sea if needed for a while etc.  You are mobile and not stuck to land where the fighting will be.  Think of all the places to hide along the coast of Alaska.  I imagine it is the same all along both coasts.  It for sure is on the Gulf coast.  thousands of miles of coastline.  Ought to be able to find a place to moor for awhile.  Maybe do a little hunting and then move on.

[Atash Hagmahani]

I would love to have a boat, but it will have to be a fairly humble one.

[hancocs]

http://seattle.craigslist.org/sno/boa/1227964238.html

Check it out. Who wants to go with me. It going to take more then one to sail this bad boy. WOW what a boat.

[opsec]

That's a lot of boat. 

First thing I'd do is have those engines either rebuilt by somebody who has been doing it for a lot of years and has a reputation to protect, or replaced outright. Rebuilding is usually cheaper. I'd also replace every single seal of any description on the entire boat.

You're going to need a trained team to handle that thing.

[Mike]

One of my biggest regrets:

In 1980-1981, when interest rates were going through the roof and real estate sales were difficult, I had a chance to trade my house for a 40' ferro-cement boat.  I was really tempted, but didn't do it because I didn't want to pay for diesel or moorage.  I regret not trading.

[hancocs]

Yup, I would like to find out alot more about this boat. About where it was built and the history behind it upgrades ect.., They have a phone number but no email address, and given I'm out in the middle of the Bering Sea, phone calls are not cheap.

[Mike]

Any one of us could give the seller a call and ask him for his email address, or to email you.

How big a crew would it take to utilize the sails on a boat like this?

What kind of range do you think it might have using just the diesel motor?

I wonder if there would be any deals on boats in Florida?

[hancocs]

Good questions Mike,

I got a couple PM's...So we are checking into it.

[The Future]

I think you might not be the only one on the high seas.  There are millions of people with sailboats.  Piracy is making a comeback!  Also, rough weather will dictate making landfall and under duress one could end of somewhere quite unsuitable for survival.  In general I think the whole boat as and out is very high risk.  I would rather stay locked down in a semi-urban area (or ideally more remote) with enough supplies to wait out the social storm under more a (literally in this case) more stable foundation.  Just a thought.