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The Daily Grind

Working this plan to pay off your house doesn’t free you from the daily grind, in the short term. You’ll still need to:

  1. Keep making the payments on your mortgage.
  2. Keep making payments on other fixed debts and expenses.
  3. Scrape and save whatever you can.
  4. Store your savings into silver until you reach your target number of ounces.
  5. Keep your head above water during this disintegrating economy.
  6. Monitor the price of silver and be willing and able to cash in when the time is right.
  7. Cash in, pay the taxes, make large payments on your mortgage and lay low.

Doomed From the Start?

Are you paying on a mortgage from the overvalued bubble market?

The contrast between the difficulty of paying off a bubble mortgage and buying a new house in cash is going to get extreme. If it’s too much harder then consider a short sale, rent for a while and use your silver to purchase a new home when the time is right. You might as well benefit from lower housing prices.

As mentioned in Part 1 the money the bank ‘gave’ you was conjured out of thin air because of The Awful Truth of How US Dollars are Created. It’s morally wrong to break a legal contract and I’m not advising one to do that. However, many debtors are questioning whether a mortgage is a legally binding contract since the bank doesn’t provide equal consideration (The Bank brings no risk to the contract since the money is created out of thin air using your signature).

Tax on Standing Still

Standing still will cost more dollars in the future than it does now. If you manage to come up with more dollars to stand still you’ll be taxed as if you’ve gained something.

This double theft of inflation and more taxes is ridiculous, of course. But, you’ll have to put more silver aside to pay the taxes on your non-gain. Otherwise, you’ll fall short of you’re goal to pay off the house.

How much more silver you’ll need for taxes is a function of the size of your mortgage and your current and future tax rates. It’s a moving target, but, you’ll have to take a stab at quantifying it to achieve your goal.

Federal

Buying or selling back silver eagles require no 1099 broker reporting. $1000 face value of junk silver (752 oz silver) is the threshold of reportabability. Less than 1000 oz of other forms is not reportable. A tax advisor would probably tell you that its good to know the reporting rules, but, they don’t affect the definition of when you’ve realized a capitol gain. You may, however, want to sell in increments less than 1000 oz. to minimize paperwork.

Sales Tax

Purchase in increments greater than $1500 to avoid paying sales tax on the purchase. Check your state rules for the threshold.

How Much Silver Do You Need?

Enough to pay off your mortgage, pay taxes on the non-gain and cover the spread on the buy and sell of the silver. If you can swing it why not add all your fixed debts to the mortgage amount and buy your way out of all debts?

The 1980 price of silver was $50/oz. The inflation adjusted price of $50 in 1980 is $129 in 2008. And yet, the current October 2009 spot price of silver is $16.32/oz.

Based on your belief use a silver price of anything between $35 and $129 for your calculations of the number of ounces to purchase with today’s savings. Then pick the month and year you think it will be worth that price. My number is $75.

I believe the dollar will fall and silver will rise in dollar terms so that one ounce of silver will be denominated in at least 75 dollars within three years. Tell me that its November 2012 and silver is $75 an once and I wouldn’t think you were saying anything extraordinary.

Example

Principal owed = $100K
Silver Now = $16.32
Silver Then = $75
Cap gains tax = 15%
Spread on the buy = 6%
Spread on the Sell = 2%
Ounces needed = 1537 costing $26,589 in todays dollars with buy spread
Sale price of 1537 oz. after paying sell spread = $112,969
Cap gains paid = $12,957 (costing 173 ounces at $75/oz)
Net (After taxes and spreads) = $100,012

So, for every dollar you save in silver you’ll be able to payoff 3.8 dollars of mortgage after paying the taxes on the silver gain if silver goes to $75.

How does that compare to saving dollars in a bank at 0 interest? Let’s say every dollar you have now is worth 60 cents then. That means instead of having 3.8 dollars you’ll have 0.6 dollars. That means you’ll have 6.3 times more dollars in your hand if your savings is in silver rather than dollars (3.8 / 0.6 = 6.33).

Step-by-Step

  1. Decide what you think the price of silver will be in three years.
  2. Look up how much you’ll owe on your house in three years.
  3. Divide principal owed / silver spot in #1.
  4. Add in the buy spread on the purchase
  5. Add in the taxes on the gain.
  6. Add in the sell spread.
  7. Add 2, 4, 5 and 6 and recalculate #3 substituting the new number for the numerator (It’s recursive because of the taxes. I made a spreadsheet to calculate 1-7).
  8. Find a source to purchase the silver.
  9. Purchase the silver
  10. Purchase a gun safe, not necessarily shipped to your own property.
  11. Take physical delivery of your silver and store it somewhere safe — The gun safe being one of many options.
  12. Keep making your mortgage payments and other expenses
  13. Monitor the spot price of silver
  14. Get as familiar and comfortable with selling your silver as you did in buying it in step 9.
  15. Wait until the value of your silver hits your spot price.
  16. Sell the silver in increments that enable you to minimize taxes on the gain.
  17. As you sell the silver make huge payments on the principal of your mortgage.

Check the current spot price here and find a local coin shop.

That’s it! Don’t think about it too much or cash in the silver too early. Get back to your life.

If You Don’t Have the Money

The savings required to buy enough silver to pay off your mortgage is small in comparison to the size of a mortgage. However, it’s by no means a trivial amount of savings.

If you don’t have enough then either buy what you can or focus on other real assets. I keep a running list of my favorite real assets in Checklist for Hard Times. In that article I recommend not buying precious metals until you have the real things needed to fulfill the needs of your family. Providing shelter (Paying off the house) certainly qualifies as providing for the needs of your family, in my book.

With all this talk of money and sliver you might be surprised that my philosophy is that Everything is Worth More Than Money.

Belief is Good (And Downside Risk is Minimal)

The technique I’m proposing will work for balanced and financially conservative reasons. Yes, silver is undervalued, but, don’t bet the farm on it. Rather, payoff the farm with it. Use the rest of your savings to hedge risk and purchase tools and seeds for the harvest.

What I’m not saying:

  • Buy silver because you’ll make a lot of money.
  • Silver is your last chance at an investment of a lifetime.
  • Put every spare dime into more silver.
  • The silver market is manipulated and will spring back with a vengence.

I can’t make these statements because markets can be manipulated and investors can be wrong longer than you or I can remain solvent.

What I am saying:

  • The dollar will continue to fall and there is no government plan, action or will to save it.
  • The dollar will not be saved by deflation (Occuring simultaneously with overpowering inflation).
  • Silver is the most undervalued candidate among many other choices for hard assets in which to preserve savings.
  • Silver is not your only alternative for this plan. It’s just what I think is the best alternative.
  • Silver will preserve, though not necessarily increase your real purchasing power. It is the preservation, not the increase that this plan depends on.

Whether you execute the plan depends on your belief. Writers that specialize in precious metals are better sources to hone your beliefs than I can be in this article. I’ll list my favorites, below and suggest a reading sequence.

Belief is best when it comes from your own research. I recommend reading the following articles, in this order, to optimize your time.

  1. Refuting Myths about Gold
  2. “Why is Gold Money?”
  3. Then and Now
  4. The Great Silver Spike of 1980
  5. Find Your Local Coin Shop
  6. Future Gold & Silver Prices
  7. The Silver ETF: What’s the deal?
  8. The Money Chart
  9. How to Buy Silver, & Avoid Getting Scammed
  10. Silver: Questions and Answers
  11. Why Silver is better than Oil as an Investment
  12. Fekete Questions Me, & Why Banning Usury Won’t Work
  13. Fekete Answers Me & the Debate Continues
  14. Bar Graphs of Silver vs. Money
  15. FAQ
  16. The Money Charts – 2008
  17. What’s the Price of Silver? 
  18. Troubled Silver Dealers

In 1980 it took 814 ounces of silver to purchase a median-price home in the US.1 In today’s dollar 814 ounces would cost you $13,154.2

If this happens again you’ll be able to purchase a home, free and clear, for $13,154 of today’s dollar if stored in silver instead of the bank.

This article is not about buying new houses. It’s about a technique to get out of debt and own the house you live in. The debt I’m referring to, here, is fixed: Your rate and monthly payments are the same for the life of the loan.

You need only track the remaining principal on your mortgage and the spot price of silver to come up with input numbers for my proposed technique. Whether or not you execute the plan will depend on your belief.

Belief is best when it comes from your own research. I’ll provide some points of departure for that research but want to focus on execution, here.

Perhaps your belief will come easier knowing that what I’m proposing is just a . . .

Faster Version of the ‘Same Old Thing’

As a debtor, inflation helps pay off your mortgage if your wages keep up.

Every monthly payment is worth less to the bank. The inflation (Theft) is slow enough that wages get a chance to catch up. They rarely do keep pace, but, the number of dollars you receive usually does increase over time.

Three things are happening here on a normal basis as you pay off your mortgage:

  1. Your getting paid more dollars from your employer or customers as you attempt to maintain purchasing power.
  2. Each of your fixed payments are worth less to the bank.
  3. The value of the balance due on the mortgage decreases by the principal portion of your payment and the inflation adjusted value of the remaining debt.

To speed up this existing process I propose that more of the the fruits of your labor be stored in silver to preserve (And possibly increase) its purchasing power. In effect, you’ll be speeding up step 1, above, by translating back your silver savings into dollars at some future date and paying down your mortgage. By that time, however, the dollar will have fallen and silver will have risen.

The silver you cash back into dollars will pay off a larger chunk of the currency your mortgage is denominated in: Dollars. Those increased number dollars may or may not have more purchasing power. But, you don’t need them to. All you need is for the silver to buy more fiat dollars to satisfy the mortgage. In other words, the mere act of preserving existing purchasing power will give the same effect as an increase in purchasing power when it comes to ‘purchasing’ debt.

In this one respect the falling dollar can be used as a One Trick Pony to help you escape from fixed debt.

Give to Caesar What is Caesar’s

As the dollar falls silver (And gold) rise in dollar terms to accurately reflect their unchanging value through the prism of a disintegrating metric (The dollar). Happily for you that disintegrating metric is what you owe the bank. Your mortgage says you owe dollars, not gold or silver. So store real value. When that real value is inevitably worth more tokens in the future turn them over to the bank to purchase your freedom.

Give to Caesar what is Caesar’s: The tokens he conjured out of thin air that now enslave you.

This Bubble’s For You

As people start to catch on and gravitate towards true value more will flee the dollar and buy up real assets. Silver is one of the prime candidates. The above ground silver available for purchase starts to disappear. This secondary event, in turn, causes more flight from the dollar which feeds an even more rapid rise in the price of silver. Then silver, itself, starts to rise even above its true value being one of the few worthy recipients of the flight from the dollar.

The amplification effect on price between silver scarcity and flight from the dollar continues until it takes the familiar shape of historical bubbles we’re now all familiar with. However, knowing this in advance and setting aside a modest amount of silver means that This Bubble’s For You.

I base this on . . .

A Radical Prediction that What’s Happening Will Continue

The Dollar Has Fallen 40% in the Last Eight Years. Contemplating another 40% decline in the dollar is no more outrageous than expecting things to continue as they have been.

If the dollar falls another 40% then a mortgage of $100K will be worth $60K in current value. Before shedding too many tears for the bank recall that the money they ‘gave’ you was conjured out of thin air because of The Awful Truth of How US Dollars are Created.

Apart from some temporary uptick the MSM will seize on as ‘proof of recovery’ do you know of anything being done that will save our fiat tokens?

Get On the Short List

You won’t fully benefit from the decreased value of the mortgage unless you can manage one of the following:

  1. Your wages keep up with Inflation. If you increased your wages by 40% from 2001 to 2009 it was due to your own efforts not the silly CPI adjustments referred to as your raise.
  2. You get paid the same wages in a currency that maintains its purchasing power. If you can manage this you either don’t live in the US or I’m reading your financial columns and watching your youtube videos. Thank you and enjoy the fresh air of the Swiss mountains or I hope your Mandarin lessons are going well, Mr. Rogers.
  3. You use today’s dollar to purchase an asset or commodity that maintains its purchasing power.
    Bingo! Now, that’s I’m talking about.
  4. You come up with a money making idea that brings in tons of dough. Creating value for our fellow human beings is what it’s all about. Please don’t get lazy and keep the fruits of your labor in tokens.

With sharp inflation it’s a challenge to keep wages up even if you own the company. Business owners walk their own tightrope raising prices. Will the inevitable price increases be passed onto employees, immediately? Actually, they can’t.

Conducting business with a volatile currency is an expertise more likely possessed in a Banana Republic. If you’re trying to acquire such expertise there’s a fabulous little book that has a place on your nightstand: The Hyperinflation Survival Guide: Strategies for American Businesses

Stay Tuned for Part 2 of 2

I’ll get very specific in Part 2 of 2 with:

  • The Daily Grind
  • Tax on Standing Still
  • How Much Silver Do you Need?
  • Step-by-Step Implementation
  • If You Don’t Have the Money
  • Belief is Good (And Downside Risk is Minimal)

1Guide to Investing in Gold and Silver, Michael Maloney, Page 152. Maloney uses the Case-Shiller Home Price Index January 1980 home price of $42,747 divided by the silver price of $52.50/oz.

2It’s 10/30/2009 and silver is $16.32/oz. The dollar index is 76.38.

When something is rare, valuable and getting rarer, the price should go up. If the price goes down then something’s wrong. Since there doesn’t appear to be anything close to a free market for silver nonsensical behavior like this is frequent.

In situations like this you may be tempted buy shares of SLV. I don’t like all the layers between shares of SLV and the underlying metal. Owning Shares is not the same as owning the metal. It’s only the closest you can get to silver when trading on the AMEX. If you insist on pressing a button on the computer screen to “invest” in silver then you’re taking on a lot more risk than you would if you took the trouble of driving to a coin shop.

SLV is charged with buying and selling whatever amount of silver is needed so that the value of the shares match the spot price as closely as possible, after expenses and liabilities. The trades are purposely robotic: The spot price, not skill or market timing, drives the trade.

As ETF’s age, they have to sell more and more of the underlying commodity to pay for expenses and profits. The older the ETF the less correlation they have with the underlying commodity. GLD is two years older than SLV so has less correlation with physical Gold than SLV has with Silver which is still about 99% (And falling).

Another negative for SLV is the size of the stockpile the ETF has accumulated, now 206 million ounces. Such is a ripe target for state seizure or other theft. And, who knows if SLV is just leasing silver, for a day, to pass monthly inspections to satisfy investors of their “reserves”.

It wouldn’t make sense in a normal market to call Gold an investment. Gold is just Money, no more, no less. I do see Silver as an investment, however, even though it’s also money. As a commodity the scarcity of silver is bullish with respect to its industrial demand. This would be smoothly worked out in a free market, if there was one. But, like gold, the spot price of silver (Based on the futures market on the COMEX exchange) is manipulated to make the dollar appear strong. You’d have to be directly privy to manipulation decisions to understand “market” timing.

Eventually, as the physical market cannot meet industrial demand the price will go up irrespective of manipulation. A monetary premium would be a bonus.

Mike Maloney describes Gold and Silver ETFs:

Last April, I sent an urgent e-mail to my friends and family urging them to consider taking protective measures against the collapsing US dollar. Now that I have YourOptimal.com up and running I’d like to put forth a more formalized plan and make it available to a wider audience.

(For an update of this bailout plan, see Depression Proof Your Money)

You don’t have to agree with my future predictions to be inspired to protect yourself from our current 10% inflation rate. Do nothing and your $100 today will be worth $86 next year if its in the bank. I will be adding more articles, links and resources that will explore optimizing various aspects of life in light of the dismal state of our US and world economies. The purpose of the plan, below, is to provide an Optimal plan of action in case you are already convinced that action is required to protect yourself from the coming Hyperinflationary Depression. Here’s the plan:

  1. Pay off all debts, within reason.
  2. Move out of all investments dependent on US dollars.
  3. Move all but 3-months of expenses out of banks into tangible & liquid assets.
  4. Decrease your monthly overhead as much as possible.
  5. Get rid of all physical objects you don’t need.

That’s it. Although the economic problems we are experiencing may appear to be very complex Your Optimal Bailout Plan for protection need not be.

Ninety percent of the protections you can achieve from the collapsing US Dollar will come from your complete and thorough implementation of the above 5-Steps. In fact, if you live in the US it may not be possible to save the remaining 10% of your assets since you need to keep some US Dollars in the ‘pipeline’ just to conduct your everyday affairs.

There are many non-financial aspects of the crisis that we are entering. I look forward to addressing those in future articles. For now, there is no point in complicating the plan until you have a handle on the above 5-Steps. Let’s go into detail about each of these steps.

Pay Off All Debts, Within Reason

Since we are entering the most inflationary period in all of US History we have to look at debt a little differently. During hyperinflation some debts become assets for the debtor. You may stand to gain more by making the payments than paying them off. That’s because your debts are denominated in a currency that is losing its value on a daily basis. The contract you have with the bank to pay off your house requires you to pay US Dollars. The actual value (Purchasing power) of future dollars is much less than the value of the dollars now in your wallet. If you can find a way to preserve the value of your dollars, today, then you can exchange that value for many more dollars, tomorrow, and make your future monthly payments much easier.

To give an idea of just how much you can benefit from this technique let’s look at the history of the US Dollar from 1950-1990. The US Dollar lost 82% of its purchasing power from 1950-1990. And it has lost 47% of its 1990 value as of 2007. So there is nothing extraordinary about predicting it will lose its
remaining value. Seventeen other countries lost 99% of their currency value during the same period and Fifty-two fiat currencies lost even more value than the US Dollar! This is business as usual for any paper fiat currency. The worst performing currency on the list was the Argentinean peso. Here’s an interesting comparison between Argentina and the US.

Hyperinflation Can Pay Off Your House Loan

If the US Dollar is worth 50% of what it is today (7/15/2008) in 5 years then a mortgage of $100,000 today will be worth $50,000 in July of 2013. If you make your payments for the next 5 years you will have paid down your mortgage by whatever principle your payments could manage and the inflationary decline of the US Dollar will make an additional $50,000 payment for you!

The reason you rarely hear this advice is that its very tricky to manage. You will have to make sure you can manage all of the following variables:

  • Store your current dollars in something that maintains its current value.
  • Keep enough dollars on hand to make the debt payments.
  • Keep enough dollars on hand to pay for all of your other expenses.
  • Monitor the value of dollars and the value of your tangible asset.
  • Be willing and able to translate your tangible asset back to dollars.
  • Manage your bank account(s) so that you have just enough to meet expenses.
  • Have the mental and emotional fortitude to stay the course.

Using silver as an example, 1000 ounces of silver could have purchased a median value home in 1980. Some say it will again as as we enter this second round of the most hyper inflationary period in US History. You can purchase 1000 ounces of silver today for $14,000. As the dollar value falls you cash in the silver to make your house payments. If the economy goes like it did in 1980 that’s all the silver you need to purchase the note. But, make sure you buy the actual silver and keep it in your possession. The same technique can be applied with gold, of course.

Most financial people don’t want to get into these complexities. They want to keep things simple. They also know from experience that most people are overwhelmed with the details of everyday life and have limited time left over to tend to the financial aspects of their lives other than their job. You may also not be able to make your debt payments if you lose your job.

If you think you can manage all of the above variables then my advice would be to not payoff or accelerate the payoff of your fixed rate mortgage. If you have an ARM then this advice does not apply. In the case of an ARM you might want to consider a short sale while the climate is socially acceptable and you get the special tax break of not having to pay taxes on the amount that the bank let’s you off the hook.

If you have other long-term debts with an interest rate less than 7% (Student loans?) then you should probably not pay them off either. This is assuming you take the same approach as outlined above by purchasing other tangible assets that can be used to make future payments.

If you have long-term debts greater than 11% then you should pay them off despite the upcoming hyperinflation. Just getting free of the burden of these debts is enough incentive to pay them off. You’ll also be left with that much more resources to put towards the other 4-Steps of this plan.

Between 7 and 11% is the gray area and you’ll have to decide how well you can manage the complexities, above, in holding onto debt during periods of hyperinflation.

Move Out of All Investments Dependent on US Dollars

In 1944 we made an agreement with Saudi Arabia to provide military protection for them as long as they agreed to accept only US Dollars in exchange for oil. Since every country needs oil for energy, and many other things, every country had to start stockpiling large amounts of US Dollars to pay for their oil. This little known backdoor negotiation, along with the Bretton Woods Agreement in the same year, is how the US Dollar came to be the world’s predominant reserve currency.

Its important to understand the ramifications of the US Dollar being the world’s reserve currency in order to evaluate whether any given investment is dependant on the US Dollar. It gets even more complicated when other entire countries peg the value of their currency to the US Dollar. The effects of the good, bad and the ugly management of the US Dollar ends up getting exported to entire world in one way or another.

Because the US Dollar has a world effect unlike any other currency in the history of the world the US had the potential to effect the world in a very positive way. Unfortunately, the US defaulted on its international promise to exchange dollars for Gold in 1971.
This made every currency in the world into a fiat currency overnight. No longer tied to any objective value they have been freed to float at the whims of politicians, Central Banks, the World Bank and the IMF, ever since.

The history of fiat currencies, however, has proven that once a paper currency is not backed by any objective value the issuing government cannot resist the temptation to print more and more of them. Unfortunately, the US has been no exception to this historical rule. We did, however, manage to take the creation of US Dollars to a whole new level by skipping the difficulties of the printing press and going right to computer! And since other countries have to use Dollars to buy oil, and some even use US dollars as a backup or primary currency themselves, we’ve been able to get away with printing far and above the amount of paper dollars any country ever has before causing the currency to collapse.

As of 7/19/2008 the charts showing the value of the US Dollar against gold is remarkably similar to the charts of other countries just before they entered the final stages of hyperinflation. Here’s how it played out in Germany between 1919-1923:

What this means for moving out of any investment dependant on US Dollars is that almost nothing is safe. Conducting business during hyperinflation is very difficult and most US companies do not have the experience to manage the difficulties. To make matters worse, the individual equities of even the best run companies are psychologically tied to the broad market of all equities. When the broad market takes a hit so do all the rest, whether they deserve it or not. Therefore, even the stock of well run US companies is not a safe haven for your money.

Even moving US Dollars into another currency is dangerous because all the currencies of the world are fiat currencies. Although its the US and Zimbabwe in the news, lately, our mismanagement is already causing inflation around the globe as other countries continue to purchase our debt instead of investing the money into their own economies.

Bankruptcies and hyperinflation seem to be the plan for dealing with this crisis. Bankruptcies are the quickest way to deflate the amount of currency in circulation, either real or on the computer screen. And hyperinflation makes all of our debts much cheaper to pay off. What better way for the US to avoid defaulting on their unpayable debts then by paying them off with dollars made worthless through hyperinflation?

But, we don’t even get much of the benefit of the deflationary bankruptcies to balance out the inflation because the Fed conjures up however many billions of dollars necessary to ‘provide liquidity’ for failed large banks and mortgage lenders.

For all theses reasons I believe the only safe thing to do is to park your money in tangible commodities that preserve value. My personal favorite is silver, but, there is also oil, cotton, tobacco, sugar, wheat, copper, steel, gold, brass and anything else China and India need to keep their countries on the rise. If silver is your choice here’s how you can invest in silver.

The worst place to have money is in US Dollars, Checking or Savings accounts, CD’s, US Equities or indexes, T-bills or bonds.

Move All but 3-Months of Expenses Out of Banks Into Tangible & Liquid Assets

When you get a dollar in your hands that you don’t need for the next three months of expenses spend it on something of real value as fast as possible. Pay a bill, pay off a high interest debt, see if you can pay monthly bills in advance for the whole year, upgrade your slow computer and maybe even purchase food items with a long shelf life. When you’ve done all that and you still have money left over then its time to purchase more well known tangible assets.

I can only recommend Silver and Gold to fill this role because I have direct experience with them. The process is difficult enough without complicating it further by trading in and out of commodity stocks and keeping track of the tax ramifications. With silver or gold you can trade in and trade out as much as you need, almost anywhere, with no tax problems to worry about. The VAT makes it difficult to do this in the UK although I’ve read that you get it back upon selling.

If you have a 401K you can’t withdrawal without penalties then consider investing in a commodities ETF, Agricultural index, Natural resources and anything else that mankind requires and cannot do without like cotton, sugar, wheat, steel, iron, brass, silver, gold, corn, etc. If your 401K is limited in its options to invest then you have limited options to protect it.

Decrease Your Monthly Overhead As Much As Possible

Any extra money you have right now should go into purchasing tangible commodities that can preserve current value for when the US Dollar collapses. Therefore, any unnecessary monthly expenses should be cut back or stopped completely. Here’s a beginning list of things to get rid of:

  • Cable channel subscriptions you don’t watch
  • Internet subscriptions you don’t benefit from
  • Expensive Coffee
  • Excess minute plans for your cellular phone
  • Consider dropping phone land lines, altogether
  • Magazine subscriptions you don’t read
  • Eating out too often
  • Drinking out too often
  • Going to the movies when you can rent a DVD
  • Over insuring your house, car, health, life
  • Driving too far from home or work for errands or services
  • Overusing the A/C or Heater when fans, windows or firewood would do
  • Work at home a few days a week to cut down commuting time & money

Any money you save could go towards paying down debt. If you’re out of debt then consider taking the money saved and purchase silver coins at your local coin shop.

Get Rid of All Physical Objects You Don’t Need

Anything you own that you don’t need or use is a drain on your limited resources of time, effort, money, space, insurance, storage fees., etc. Your life will improve whenever you get rid of things you don’t need, now more than ever

  • Clean out the garage
  • Sell, donate or throw out the items in the garage you don’t need
  • Sell any cars you don’t use or need.
  • Hire a student or family member to put items on ebay and manage the sale
  • Donate items to others that are too bulky to sell

Copyright © 2008 by Terence Gillespie. Permission to reprint in whole or in part is gladly granted, provided full credit and a live link are given to McGillespie.com