Are you one of those people who believe that you should save money to get rich? If so, ask yourself these questions:
- How much do you have in your savings account TODAY?
- How much was that amount worth 10 YEARS AGO?
- How much will that amount be worth in 10 YEARS?
- When you look at these questions, you will realize that by SAVING money, you are, in fact, LOSING money.
Now I’m going to tell you something that will make you think I’m crazy: You can benefit more from being IN DEBT than from owning money. And by “money” I mean: paper money. The kind of money your government makes: counterfeit money, monopoly bills.
But before you call me crazy, let me ask you the same questions in a slightly different way:
- How much debt do you have TODAY?
- What was the value of that debt 10 YEARS AGO and
- What will the value of that debt be in 10 YEARS?
First of all, you need to realize that the value of most major currencies is decreasing every year (and therefore the value of less important currencies also decreases, because they are pegged to major currencies). If you bought a car in 1900 for $ 1,000, that same car would cost you $ 26,800 today.
The food you bought in 1975 for $ 100 would cost you $ 405 in 2010. That’s 400% more.
If you paid 81.87 euros in 2000 for a nice shirt, you would have to pay 100 euros for the same in 2010. If this is happening in the rich countries of the first world, what would be the effect in the poorer countries?
How does that happen? Ask the bankers who steal your money and then save at their banks with your money. Bankers fill their pockets with their money instead of pushing it into the economy, then print more money to fill the void (this is how inflation is created). And you pay the bill.
What are the effects on your debts and financial (monetary) assets when the value of money decreases? It is quite simple:
- The value of your savings decreases, but also
- The value of your debts goes down
- In other words: each year you can do less with the money you saved. And every year your debts are worth less. Or: earn more debt than having money in the bank.
Let me give you a quick example. Let’s say today is September 1, 2012. The president of the United States of America has just announced that the dollar will devalue. In Brussels, the president of the European Union declared that the euro will cease to exist, as the rating agency Standard & Poor’s lowered France’s rating from AA- to A. In Italy and Spain, the police shot hundreds of people who they robbed supermarkets in the worst food riots since December. 2011 when President Berlusconi was sent to jail.
You had 100,000 euros in the bank. Your 100 grand are now worth 100 euros.
You had a $ 500,000 mortgage. Now that mortgage is worth 500 of today’s dollars.
You had gold bars and silver coins in your private vault, worth $ 50,000. When paper money goes down, precious metals tend to go up. Now his bullion and coins are worth $ 5,000,000.
What is the lesson here?
If you want to save $ 100 today, and you want to make sure it is still worth $ 100 or more next year, you need to save on something that will hold its value. That could be, for example, oil, real estate, precious metals.
Personally, I would not prefer oil, as most oil fields are in politically unstable regions. And I don’t like investing in damaging our environment.
Real estate is an option, but I’m too lazy to own it; I don’t like people calling me on Sunday mornings complaining that their roof is leaking.
However, precious metals are a good option for me. The most popular precious metals to invest in are gold and silver (and some will even consider platinum).
The problem with gold is that it is out of my reach as a beginning investor. Gold prices are not within the current range of my portfolio (although: there are methods to buy small amounts, which make gold easier to buy).
Silver is in very high demand, because it is used in everything that has to do with communication. The Internet, for example, could not exist without the money used in components, telephones, computers, etc.
At the same time, the price of silver is still quite low (but on the rise). Silver could give you a very high ROI, perhaps even more than gold.
What does this have to do with you?
The next time you
- note that you have to pay more to fill your car’s gas tank
- notice that you can buy less food with the same money
- notice you’re broke faster than in the past
- gold
- when you hear about hungry hungry people
- when you hear people burning cities and looting supermarkets:
- then you must realize that it is the process that I described in this article in action. The famous author Robert Kiyosaki (Rich Dad, Poor Dad), predicting the next one says: “Buy food that you can store. Then buy a gun.”
And it will affect you, if you don’t take the precautions. The most important preventive measure you should take is: secure your finances. Save some cash for daily expenses and transfer the rest of your money to precious metals.
Stop saving money in the bank. The only thing you do by saving money in the bank is making a banker rich.
Do not trust bank vaults. Did you know that when you rent a bank vault, what is in that vault can actually become the bank’s property? Read the fine print when you do business with a bank.
Start buying gold and silver. You can get some gold and silver for as little as $ 20 to $ 50 a month. Of course, I am not talking about certificates, but about real gold that you can get your hands on.
And start doing it today. You don’t have much time left.
