Are You Practicing Financial Redundancy?

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After the stock market opened up this week on “Black Monday” and quickly dropped 1000 points, many people were surprised. The internet was abuzz with stories discussing the various reasons for the market turmoil and more than one educated source said these wild fluctuations are “perfectly normal”. Economists sounded a more positive note and talked about how it was a “buying opportunity”. I read another headline that was telling everyone to “take a deep breath and do nothing”. The advice implicit in all of these examples is that we sheep need not worry because everything is going to be fine. The financial experts on TV know what they are talking about and we would be foolish to do anything contrary to their advice.

I would agree with some of their advice. If you have the knowledge and resources, yesterday may have been a buying opportunity. If you have trillions of dollars of money that was created out of thin air, entrusted to you to invest, maybe there isn’t anything to worry about, at least in terms of the stock market volatility. I don’t recommend anyone panic and jump out of any buildings now. Markets do go up and down, but the long-term average is always up, right? Maybe there isn’t anything to worry about and yesterday certainly turned out to not be the global collapse feared by many.

On the other hand, I don’t think you should sit back and do nothing. Personally, I think we are in for a scary ride and yesterday was just the most ominous first signal. It was the beginning of a roller coaster ride that will eventually end up crashing into the parking lot coming out of the 4th loop. Yesterday was like the initial jolt you feel as the coaster shudders before the run up the hill. We still have some ride left, but I don’t think it will end well.

How can you prepare for economic collapse?

What can preppers do in the face of an economy that according to many experts (I certainly am not one) is dangerously close to collapse? There isn’t anything we can do to affect the markets. You won’t be able to shore up the economies of any other country around the world much less our own. However, the global economy will impact everything so even if you are like me and do not have any money in the markets you will be affected if they tank.

Your 401K might be perfectly fine in a year or it could lose all of its value completely. Yes, there are traders who are able to short the right commodities and make a fortune even in this financial climate. This article isn’t for them.

There are steps you can take to reduce your risk of exposure though if the financial markets take do end up taking a dive. You can begin to protect yourself so wild market fluctuations, maybe even crashes will impact you less in the short run. You wouldn’t only have one survival knife or way of making fire in your bug out bag, would you? You have backups and we call this redundancy. Shouldn’t the same principles apply to your financial health? Are you practicing financial redundancy? Instead of relying completely on your bank which could fail or simply refuse to give you the money you gave them for safekeeping, do you have an alternate way to get money? Instead of expecting your credit cards to work when you need to buy gas, do you have backup cash?

Time is running out I fear, but you can still take meaningful actions now to prepare your family. I will say again that I am not a financial expert and do not claim to know anything more than a 5th grader when it comes to economics but  the steps below are what I have chosen to do. You must make your own choices with the information and resources you have.

Step 1 – Get out of the market now

When we had our last little hiccup with world finances I along with many others watched the value of my 401K go down daily. It was a pitiful sight and I didn’t even have as much money as most people have in there. I certainly wasn’t anywhere close to retirement, but the money invested was my nest egg for what it was worth. It lost half of its value in just a few months. When it regained most of the initial value I had in there after a couple of years I decided to cash out. I took the interest penalty and turned most of my investments into precious metals that I physically have access to. This approach isn’t for everyone but now I am sure that my investment will not be worthless in October. There are many economists predicting losses of as much as 40% or more.

When banks don't feel like they need to give you back your money, this is what it looks like.

When banks don’t feel like they need to give you back your money, this is what it looks like.

Step 2 – Get as much cash out of the bank as you need to live for one month

or longer. Greece is still limiting withdrawals from banks. The money that people placed into the bank is not able to be taken out of the bank. They can use banks to pay bills but they can’t get money out when they want it. Don’t let this happen to you. I have set aside cash in the event that banks declare a bank holiday or severely limit withdrawals. This also works for power outages too when the ATM machines simply aren’t working.

Step 3 – Eliminate debt if you can

Some time back I asked the question of whether we should pay off our credit cards or buy prepping supplies. I do still believe that debt should be paid off. I don’t believe you should be incurring other debts either but must admit I fall short in this area. I haven’t lived an austere lifestyle of rice and beans to save pennies to pay off my mortgage. What happens when everyone is out of a job?

Step 4 – Have an alternate source of income

They can’t fire you if you’re the boss. There are millions of ways you can go into business for yourself and begin making extra money that you can use to pay down debt, purchase vital prepping supplies or simply augment your income. If you are like me and already have a day job, be thankful. A second or third part-time job isn’t without cost and effort, but it can pay off in big ways and give you some breathing room if you lose one job due to a downturn in the economy.

Always make sure you aren't completely dependent on ATM machines, credit cards or bank tellers.

Always make sure you aren’t completely dependent on ATM machines, credit cards or bank tellers.

Here are just a few examples of side jobs you can take:

  • Tutoring
  • Website design
  • Graphic Artist
  • Personal Assistant
  • Freelance Writer
  • Catering
  • Elder Care/Baby Sitter/Pet Sitter
  • Editor
  • Seamstress or Tailor
  • Landscaper/Mower
  • Odd Jobs/Handyman
  • Housecleaning

The possibilities are limited only by what you feel like doing and your own commitment. Will you look back after a job loss and miss all those reality TV shows you could have watched?

Step 5 – Start prepping now

If you haven’t started prepping already, it’s not too late! If you have started, make sure you reevaluate your prepping plans to make sure there aren’t any gaps you meant to take care of and forgot. You still have time to stock up on supplies you need. The basics haven’t changed. You need food, water, shelter and security. Do you have those bases covered?

The pages of the Prepper Journal are filled with over 740 articles devoted to Prepping so if you need a jump-start, here are a few links to help you.


We also have most of the articles available in PDF files that you can download to keep spare copies of the information on your computer or spare laptop. If you can’t find what you are looking for use the search bar at the top right of our page. If you still have questions, please use the comments below and the whole reader base will help you.

It’s going to get bumpy from here on out I fear. Are you prepared?

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Freedom-loving American doing what I can to help prepare and inform others. Editor and creator of The Prepper Journal 2013-2017, 2020 -

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I am not quite as worried about the debt bomb as I used to be. When the grid goes down and money is useless, who is going to collect? I would would rather put a few things on the card, then pay it off and have it. Then try to save up for it and not have it when something goes down. The Glock in hand paid for with the Visa is worth a million times more, then the Glock in the store and a wad of saved up cash in my drawer. I also suggest layaway if you don’t… Read more »

Pat Henry

I have considered that aspect of it as well LWJ, but what if the grid doesn’t go down, but the economy collapses? Those records will still be available to the people you have credit with. Even if all of the banks are shuttered, I am sure the NSA will have them.


If the economy were to collapse I would be pretty happy to have the stuff I put on the Visa. A wad full of cash will be less then worthless.

IF the economy were to collapse the only thing I could not pay off would be the house.

Mike Lashewitz

Wow! All great suggestions. Our most considerable worry is the Wealth defaulting on their own contracts. Mu income is entirely based on my contracts with the government and when it goes so does all my income. But I have skills and bartering will become paramount as even food will be worth more than gold. After the initial market collapse even that stored silver and gold will be temporarily useless, hold on to it for the other end when the financial system is rebuilt and stabilizes. Then buy that land you dreamed of as it will be much cheaper simply because… Read more »

Pat Henry

Thank you very much Mike! Your skills will be valuable indeed.

Thomas Paine in the butt

I would have to respectfully disagree that precious metals will be useless. As currency yes, but silver and copper have antimicrobial and antibacterial properties.

Mike Lashewitz

You are correct! and building the tools to make your own colloidal are simple and cheap. Including using solar to do it…

Mic Roland

The Alternative Income point is a good one, but a tough one. If times are bad generally, meaning that hard times are not isolated to just you, most of your would-be customers will also be in hard times. Side jobs in graphic design, websites, catering, etc. just may not be there. Side jobs in more necessary fields are much tougher to add on. But, a variation on the Alternative Income point would be to develop your own handyman skills. If times get tough, you can fix your broken things yourself instead of paying some other ‘professional’ to do it for… Read more »

Pat Henry

You are very right Mic at least in my experience. There are millions of ideas for jobs and I admittedly threw up some of the easier options that require some amount of economy to make them possible. Your handyman idea is another great way. Had I been able to be more handy myself I could have saved a good bit this year with equipment failures.

George V. Tucker

If I may suggest signing up for services like these:
… as a relatively easy way to make some side money? Easier than a full-fledged part-time job.

Also — you make a GREAT point about how being your own handyman will save you money. ANYTHING you can do to cut your expenses goes farther than generating more income — because when you cut expenses, you’re saving after-taxes money. When you generate more income, you still have to pay taxes on it.

Pat Henry

Great service ideas George!


Since you state several times you are not a financial expert and don’t claim to be you should probably not give financial advise. You said you rode the last correction down and then waited till it came back up to where you were and then sold. Not a Bad idea but had you stayed in the market you would have added aprox another 40-50 percent gains since then. You say you bought PM’s which if you bought in 2011 or 2012 which is about when the market came back to even you have lost your butt on that purchase so… Read more »

Pat Henry

Fair enough Poorman. I thought I couched my advice with enough caveats but maybe I should have stayed away from this topic. I can’t win them all, but felt compelled to give my thoughts. For what it’s worth. Yes I could have stayed in the market but the risk wasn’t something I felt comfortable with. I would rather have what I was able to get out than risk not having anything to rely on. It was a gamble I made and I don’t feel bad about it. I don’t think anyone who did stay in the market should feel bad… Read more »


I WISH I had far better “handyman” type skills. I do have some minute skills, but that’s it. I’ve got poor manual dexterity, (too many broken fingers, too many times) it’s hard to manipulate a lot of hand tools. As far as financial redundancy, we eschew all debt possible, almost completely paid off a very small amount left, (very small), continue on stocking up goods, food stocks, reloading supplies, and of course, hardware needed with the reloading supplies. Early spring, re-stocked a ton of hand tools, including non-power hand tools, as I am certain power tools will become redundant with… Read more »

Pat Henry

We have a few articles out there Egbert, but I will see what I can come up with in terms of guest writers. In the meantime, have you read any of these below?

George V. Tucker

Allow me! From: “Working for Bell Helicopter when the revolution started, thousands of anti- Shah rioter in the streets, the military machine gunning them down, every second building in Tehran (Banks, movie theaters, liqour shops, restaurants serving beer) torched and burnt to the ground, 90% of foreigners cars and homes firebombed, (no physical casulties, just property damage, the revolutionaries were careful about that). revolutionaries firing off the roofs all night, while government tanks cruise the streets randomly loosing the 30 cal. and 50 cal machine guns in every direction. Sleeping in the cellar to avoid the random fire. Living… Read more »

Pat Henry

I can appreciate that argument George and I think there is something to be said for not reacting emotionally. However, for me personally I challenge the very validity of the current market mechanisms we have to live with because they are completely manipulated now. This isn’t the free market at work. The market is highly controlled and the outcomes we are seeing are the direct result of manipulating currency, bad economic policies and completely fraudulent investment practices. From that standpoint, the article you mention rings hollow to me and so does the advice of every economist who is saying that… Read more »

George V. Tucker

Another perspective on “Step 1 – Get out of the market now” IF you do this, AND you’re wrong, you will be HURTING. I strongly advocate diversifying your wealth — not in a Harry Browne Permanent Portfolio way, nor in a John Pugsley Alpha Strategy way, but in a “I’ve got all my bases covered” way. “I’ve got all my bases covered” means diversification: US stocks, international stocks, bonds, real estate, emergency supplies/gear, insurance, and (most importantly?) training and education for yourself and your family. See for more thoughts on this. The vast majority of retail investors (meaning folks… Read more »

Ron Johnson

“Personally, I think we are in for a scary ride and yesterday was just the most ominous first signal.”
“Step 1 – Get out of the market now”

LOL. The DJIA is up 31% since you wrote this.

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