Financial Crisis - more tips

I am continually surprised at the lack of concern generally about the gravity of the financial crisis that we are facing. Through these blogs, my website and my newsletters I am doing my best to raise the general consciousness so that as many people as possible can protect themselves and their hard-earned assets.

We are in the early stages of a massive financial crisis. There is still a little time left to take some action. I am not a doomster, and for many years, when I ran a very successful property investment company in the UK, I was one of those who was optimistic and invested very profitably between 2001-2005. During that time, the press and media reported frequently of an upcoming recession or depression, but nothing happened. However, in late 2005, I started to notice some cracks in the system and I could see that the market was changing.
It was becoming harder to sell properties, it was becoming more difficult to deal with tenants. The writing was on the wall, but only faintly. When I started to sell up my portfolio of properties in 2005-06, many colleagues and clients were astonished that I was getting out.
However, by summer of 2006, I could see that the property and investment business was not going to be fruitful for me for the foreseeable future and I decided to move to New Zealand.
It soon became clear to me that the NZ market was over-inflated and I chose not to go into the property business here either. Instead I focused on learning all I could about the stock markets, especially in the US, the currency markets and the commodity markets.
I did not like what I was seeing.
Bit by bit I could see that a major disaster was impending.

That disaster is only just beginning.

Here are my tips that you might wish to consider.
Time is running out.
Even if you think there is a very slight risk of systemic bank failure, you may wish to look at these actions as taking out insurance. Just as you have fire insurance on your property and the likelihood is a very small one that your house will burn down, you still take it out.
Look at these actions as insurance against the worst happening.
After all, isn't it better to PREPARE FOR THE WORST AND HOPE FOR THE BEST.

1. Get out of debt. Any kind of debt. Pay off those credit cards and each month pay off any balance you incur.
2. If you have a mortgage on the house you are living in, try to negotiate a better deal with the bank. Interest rates are coming down and the bank would much rather you kept the loan than defaulted on it. So there is negotiating room. Maybe more than you think. Be prepared to talk to your bank. They will be listening in ways that they have not been open to before.
Each time I go into a bank here in NZ, I can see that they are cutting their staff. In fact, one of them has done away with the reception and welcome area altogether. These are insidious signs and if you are aware, you will see that times are changing rapidly. Sooner or later, you will know someone who has lost money through a failing bank, or who has funds frozen for an indefinite amount of time and cannot access their money. How much closer to home does it have to get before YOU TAKE THIS SERIOUSLY?????
So, back to the debt on your home. Renegotiate a better rate. Work on it. Talk to different banks. Discuss the fees. Refuse to pay them. You will be surprised at how amenable they will be eventually. You just need to be very firm and not take no for an answer. It can be done.
Keep an eagle eye watch on the interest rates and check out what each bank is going. Be a "rate tart" and go from bank to bank. See what you can negotiate.
If you are on a fixed rate, make sure you are aware exactly when the fixed rate is ending, and be ready to go onto a floating rate. That will be much more to your benefit at the moment.
3. Have some cash on hand. Preferably at least 3 MONTHS LIVING EXPENSES. No one knows which banks will be all right and which ones will run into trouble. Think of how difficult it will be if you cannot get to your funds and how frustrated and angry you will feel if you do not have any cash that you can easily access. You really have nothing to lose by doing this - other than maybe a few dollars in interest, but why not consider this an insurance premium that you are paying in order to protect yourself.
It is going to get much much worse.
4. Inflation is inevitable as the governments take on more and more debt, print more and more money out of thin air, and you are going to have to work harder and harder just to stay afloat. One way to protect yourself from inflation to a degree is to stock up now on dried goods, tinned goods, toiletries, cleaning supplies. Anything that will keep for a long time. Stock up and store it. Another reason is that there could well be a disruption to the distribution chain and supermarkets may not have products to sell and if there is a panic, you will at least have the basics.
5. Buy some gold and silver coins before they are unobtainable altogether. There is a widespread purchasing going on worldwide of these commodities and even now many places are reporting that they have no reserves or that there is at least a 3 month delivery time before you can take possession of your coins.

I do hope that some of these points will resonate inside you and that you will take steps to protect yourself.

Obviously each person has a very different financial situation, attitude to risk and ultimate goals. However, these are a few straightforward tips that can be applicable to everyone.

If you need more specialised advice, please do get in touch with me.
My websites:
www.financemoneybusiness.com
www.yourastrologysigns.com

Barbara Goldsmith, MBA, CeFA, CeMAP, Cergi.
Qualified Financial Adviser, Business Consultant, Economist.