Oct222010

36 Comments

13 Ways to Prepare for Hyperinflation

A mom could get whiplash trying to keep track of the widely differing opinions of financial experts.  Many claim that America is headed toward deflation, others claim a deflationary depression is on its’ way, and yet many voices are crying, “Get ready for hyperinflation!”  Hyperinflation is particularly dangerous for families because the prices of necessary goods (think fuel, energy, and food) will skyrocket, leaving little money, if any, for anything else.

image by Andrew Turner

Most experts go into great detail explaining why hyperinflation may be on its way, and there is plenty of blame to spread around, but as a mom, my primary concern is how to prepare for this nightmare if, indeed, it becomes a reality.  Here are some common sense steps that will help you and your family be in a more stable position

  1. Pay off any debt that has an adjustable interest rate as quickly and as soon as possible.  Unsecured credit card debt, in particular, is vulnerable to increased interest rates that would demand more and more of a family’s income, already strapped to cover the most basic necessities.
  2. While interest rates are at historic lows, investigate the possibility of refinancing your mortgage.  If your mortgage rate is already low, and fixed, focus debt repayment on anything that has an adjustable rate.
  3. Consider ways to decrease your transportation expenses.  Should gasoline prices soar out of control, you may be very happy for a job that is within walking or biking distance.  Can you sell that second or third vehicle and pocket the savings in gas, upkeep and insurance?  Be strategic and purposeful in deciding which vehicles to keep, sell, and/or purchase.
  4. Never buy new if you can help it.  Craigslist, eBay, Freecycle, resale shops, and garage sales offer nearly everything you’ll ever need.  Refuse to pay retail and use the savings elsewhere.
  5. Have a back-up plan for every major appliance in your home.  If electricity prices become outrageous, do you have everything necessary for drying clothes on a clothesline, washing clothes by hand, and an old fashioned dish-drainer or two?
  6. Visit local coin shops and become educated about purchasing gold and silver.  It’s easy to make poor decisions in a panic, and this is no time to lose money making investments in the unknown.  As the dollar loses its value, precious metals increase in value.  Ferfal of Surviving Argentina says, “Not a day goes by when Argentinians who had money in the bank before the collapse don’t wish they had bought gold.”
  7. Continue stocking up on food and household supplies.  When prices increase, this will give you a much-needed cushion of time.  The price of food always increases during hyperinflation.
  8. If restaurant meals are part of your routine, cutting back is one of the easiest steps you can take to save money and learn how to make more meals from scratch.  That will be especially important if you ever need to rely on your stored food.

    image by One-Fat-Man

  9. Have a passport for every member of your family, just in case.  This isn’t paranoia, just a precaution if you ever need to leave the country.  Hyperinflation will affect government operations, and this is one document you can’t easily get from a local source.
  10. Discover new ways for your family to earn money.  I’ve written about this before here, here, and here, but every member of the family should have a way of earning a little extra money.  A side business that involves everyone is even better.
  11. Consider how you might establish sustainable sources of food and water.  This will involve gardening, planting fruit-bearing trees, and perhaps even purchasing land with a natural source of water.  There is no survival without food and water, so these should be a top priority.
  12. Beef up your home’s security and your own personal security.  Empty store shelves, scarce resources, and overwhelmed law enforcement are common in countries where hyperinflation is a fact of life.  Proactive steps in this area just make sense.
  13. Stay positive.  The future is unknown, but what is known is the importance of family, friends, and a positive mental attitude.  Survival experts say this is the key to surviving difficult circumstances.  You might as well start practicing now!

If hyperinflation never occurs, you’ll be enjoying a debt-free lifestyle, with investments in precious metals, stored food and supplies to rotate into your family’s daily life, and a secure home or apartment.  Being a SurvivalMom is being a smart mom, and smart means being proactive and postponing that panic attack for another day when you’re not so busy!

 

There may be links in the post above that are “affiliate links.” This means if you click on the link and purchase the item, I will receive an affiliate commission, which does not affect the price you pay for the product. Regardless, I only recommend products or services I use personally and believe will add value to my readers.

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I'm the original Survival Mom, and have been helping moms worry less and enjoy their homes and families more for 5 years. Come join me on my journey to becoming more prepared to handle everyday emergencies and worst case scenarios.

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(36) Readers Comments

  1. Stupid question : how do you get a passport? Where do you go to apply for one?

    • Go here, http://travel.state.gov/passport/get/first/first_…. You'll need to have your birth certificate handy, headshot photos, and money. Also, you have to apply in person for a first-time passport. Where I live, people have to set an appointment with the Post Office and apply there.

    • Call your local post office for information. That's where my husband and I went. A postal worker lead us to an office where we filled out the paper work. She even had a camera for our pictures. Everything was mailed together with a check for the cost. I forget how much it was – only that it wasn't cheap. Allow plenty of time for the mailing back of the actural passport with picture.

  2. Great article. I'm very concerned myself about hyperinflation. I remember learning in grade school about the hyperinflation that Germany experienced during WWII (I think that is right; been a long time LOL). But what stands out in my mind are stories about how it took a wheel barryl full of paper currency to buy a loaf of bread (though perhaps that was an exaggeration in the text book but I remember it). Also, people would burn the paper money for warmth because it was almost useless otherwise.

    I would think during types of hyperinflation that people would resort to a barter system. I think that woudl be something to keep in mind. Think of what you have (or could stock up on) that you could barter with later.

    • That was under the Weimer Republic, at the beginning of the Great Depression. That is part of the reason Hitler was able to get and maintain power. He was bat-$hit crazy, genocidal, homophobic, paranoid…but that doesn't mean people realized it all (or let themselves realize it), at least right away. He also wasn't elected based on any of the things he's become known for. He didn't win a majority of votes, he was put in place as Chancellor as part of a coalition. (They foolishly thought they could control him. Oopsy.)

      Anyhow, those who did vote for him did so not because they were anti-semitic, but because they thought he could help improve the "sagging" economy. He did. He "redistributed" a lot of wealth not by taxes, but by simply taking things from those who were "rich" and "greedy" and could afford it. In his case, it wasn't based on income taxes but, of course, on race. He started some massive new government schemes including creating auto-bahns and the car company Volkswagon (even a psycho mass murderer can create something good by accident). All of this, along with creating the war machine for WWII, did improve the economy in Germany for long enough to secure his power. It is also interesting to note that cities primarily voted for him, rural areas against, and they were right. His policies did not help farmers or small businesses and were better for the cities.
      As a side note, the cities voted for him, rural areas against.

      • BTW: Not trying to justify anything he did or his followers, since there is no justification for what they did. When he was first elected, Mein Kampf was kind of ignored, from my understanding of things, as being from when he was younger – as if he had outgrown those beliefs. A lot was ignored about him in the hope that he would change things for the better, not because they wanted a dictator.

        • That is a very interesting history about Hitler – I vaguely knew how he was put into power, but your account is fascinating. Is there a place I can read in further detail?
          Unfortunately the same exact conditions that put him in power back then are beginning to exist now, HERE, in the United States.

          • That's what I find worrisome, as well. But most of our ancestors moved here because they weren't just willing to follow what their home government told them, so I think Americans are a lot more to Just Say No if the government starts going too badly wrong.

            I'll see if I can find something to recommend to you. I'm a historian, from a family of historians (with an emphasis on military history by several family members), so there's a lot I just remember from college courses, reading, and family conversations.

          • We are the grey-haired generation. My husband and I were saying that people who saw Hitler and WWII in person are becoming fewer and fewer. The new generations haven’t seen how an entire country can be fooled into letting thugs, violence and prejudice end up in power, however we are heading that way. Even our history books are being rewritten to white wash what really happened. We all have to do some research and not just read a book from a school history book. Try to find older books that have been written by researching original documents. After saying all this, the History Channel had a series of programs on Hitler that were very good.

            One more thing that seems to be happening that seems a foreshadowing is the move by Hillary Clinton and the UN to take all guns away from people (everyone except the thugs) and her suggestion during the Bush/Gore election that we change the constitution so that it becomes the country’s popular vote that wins and not use the electoral college. That of course means the cities will choose our president from now on.

  3. Well my local grocery store doesn't qualify for HYPER-inflation (yet), but I've definitely noticed the prices going up. It has made me step up in my food storage more than ever. The funny thing is though, it seems that maybe 80 percent of things have gone up, about 15 percent have stayed about the same, but the odd thing is I've actually seen a few items go down, maybe it's just loss leaders, but overall grocery prices are definitely rising.

  4. The post-World War I hyper-inflation trauma still influences Germany's national policies and individual behavior (higher household savings rate than Americans). Economists and policymakers seem to be all over the map on what lays in store for us — deflation or hyper-inflation.

    The political repercussions of hyper-inflation in this country would vastly eclipse today's anti-government fervor. A mere 13% inflation rate helped propel the 1980 Reagan electoral landslide. In a hyper-inflation scenario I expect millions more Americans would be marching on Washington than leaving the country.

    If America is ever in that dire of shape, the rest of the world likely won't be much better off — American consumers remain the world's most significant economic force.

  5. We were in Russia in 1993, when the Russian government decided to dump their currency. It was announced that they would no longer honor any paper or coin minted before a certain year. The people could come and trade their currency in at the banks but they didnt get a direct ruble to ruble exchange rate. I know why that happened, if too many russians were hording old currency or if the government had over printed and was trying to beef up a sagging ruble. The russian people as a whole seemed to take it fairly well, hate to think what would happen here. We were given small coins from a few russians as parting gifts, they no longer held any monetary value. But none of the coins contained silver or gold.

  6. I don't really understand about the passport part. I don't see any place that we, as Americans, can go that would be better than here. I understand thoughts about it being smart for jews in Germany during pre WWII days though. Seems to me though that you would need to be pretty well off to get further than Mexico or Canada and meaningfully set up as anything but a refugee. Also I'm not sure exactly what would trigger your flight. Perhaps you could elaborate on this area either here or in another post? I guess I just don't quite get what you're shooting for here.

    • I wasn't thinking in terms of escape as much as the need for mobility and which documents might become difficult to obtain. With documentation and the right amount of cash, a person can get to just about anyplace he or she wants to go. If a certain commodity is scarce and I happen to live near a country where it's more plentiful, travel will be easier with a passport and cash. Also, passports for a family can quickly add up to some significant dollars.

      I've been struck by how often Ferfal of SurvivaingArgentina talks about having a passport, and since most Americans don't have one, it could be a very smart move. Currently, it's by far the best ID for proving citizenship.

  7. I know people who have retired to Mexico. They live in one of a handfull of towns that cater to American and Canadian retirees. Everything is cheaper and they enjoy the climate etc. It wouldn't be my choice though. I have relatives in Canada and we visit them regularly. I can't see myself imposing on them by moving there but I need a passport to visit them. I wouldn't leave America. For better or worse this is my country and I will stay here and do what I can for me and my family. So the message is prepare now while you still can. Don't underestimate this. This could be the worst crisis we have even gone through, perhaps worse then the great depression. It won't be just American it will be global. There will be countries who have it better or even countries where it is already so bad they don't notice any difference. But in general it will be bad almost anywhere you might actually want to go.

    • What about Canada? I am half Canadian although not a citizen. We visit relatives up there. Do you think the mess spread to their country? My husband is a (nothing bad is ever going to really happen) so getting him to do something different is like pulling teeth. I am a cancer patient with other stuff going on and don’t have much faith in the new medical system if it is complicated or expensive treatment.

  8. Depression/hyperinflation/deflation: everywhere I turn there is an economist warning about one or all of these; it can get confusing. These are all great steps we can take to secure or improve our situation and finances. We have passports but they will be expiring next summer so we need to move on renewing them; still trying to add some sources of income as mentioned in #10. It is easy to start feeling down with all the bad news around, thanks for reminding us to stay positive!

    • You can renew if you have less than 6 months left, so you can do it soon.

  9. Spotted another warning sign this afternoon!

    Last week our local news reported the possible rise in sugar prices. I intentionally went to our local Neighborhood Walmart and bought 25 lbs. of Great Value sugar for $11.68. (I've since bagged it in Mylar.) I stopped in today for standard milk & bread and checked the sugar prices. The EXACT SAME bag is NOW $17.68!!! After I picked my jaw up off the ground, I took a picture and emailed it to my husband. It just reinforces the instability of our economy! Prepare for price explosions on ANY made with sugar!

    • That will be hard. Everything is made with sugar!

    • I'll check on sugar prices around here, RWM. Maybe the Honeyville store has some insight into what is happening and whether or not I should be worried. A while back I asked their manager about rising wheat costs. He said that Honeyville buys their wheat in massive amounts a year ahead of time, so they aren't affected by current pricing conditions. Costco would be another good place to do some research about rising prices. I do know that a number of commodities have been increasing in price over the past couple of weeks.

      • Thanks for checking!

        Two things I've learned:
        1. Poor growing season caused by bad weather and uncertainty in the commodities market.
        2. America imports its sugar!!!

        • But a lot, probably most, of our sugar is imported and grown on land that poorer countries have taken from their own people and given to us to grow our sugar. Sugar is cheap for us but is often a poverty-maker for other countries. That is way some countries hate the US so much. But it is hard to get the information from anyone.

  10. Lisa and all, I have located a new (for me) site. augasonfarms.com Is anyone familiar with them or bought from them? I think I may purchase the 6 gallon pail of banana slices (honey coated, yum), I think the shipping charges are reasonable. I don't usually think buying in pails pays off, but 6 gallons of banana slices for 32.00 +/- some change and around 5.00 +/- shipping. Thinking I may give them a try.

    • Bought some of their Bisquit Mix of the "Deal of the Day". Very good and quick service. That's all I've purchased, but I check the deal of the day everyday. Been tempted a few times w/ items that don't didn't necessarily fit into my prep plans; but I generally return to Emergency Essentials out of Utah. I was, however, very happy with my one purchase from Augusen Farms.

    • Our Wal-Mart carries some of their products. I'm in Idaho, so YMMV. :o)

  11. 14. EDUCATE YOURSELF AND YOUR FAMILY: Take classes at your local community college, trade school, or learn from friends:
    a.) How to weld.
    b.) How to use a ham radio (and then get your ham license, too!) You no longer need to know Morse code, and the basic/rookie license just requires you to memorize about 100 questions? It can be done in about 3–5 days?
    c.) Get your private pilot's license (or at least take ground school, plus enough flights to learn to take-off, and land.) If/when you need to get out of Dodge (fast,) you might need to catch the first flight out (and the commercial flights might all be sold-out.) You only pay for pro-time (when the motor is running when you rent a plane.) So, if you fly four hours away (e.g. to avoid a hurricane) and then the plane sits on the ground for two weeks — you don't pay for those two weeks! You only pay for the four hours of flight time (and the four hours back, of course.) Heck, in the event of a hurricane or such, they might allow you to take it for FREE?!!! (e.g. to get their plane out and to a safe location.) But, without a pilot's license, they aren't going to allow you to take it ANYWHERE. Plus, learning to fly also teaches you basic (or semi-advanced) navigation skills.
    d.) Learn diesel mechanics. If Peak Oil hits critical-mass, or truckers stop delivering fuel, or whatever — you CAN make a diesel motor run via veggie fuels. (Gasoline motors will be useless.)
    e.) Learn CPR. <– The life you're saving might be MINE!!!
    f.) Learn to SCUBA dive. (I've seen fisherman fish all day — and catch nothing. Yet, with my dive gear, I ALWAYS encounter fish — sometimes in the most unexpected places. Plus, when you SCUBA dive, you can collect all the snagged lures that the fisherman left behind on the underwater stumps.

    Educate, Educate, EDUCATE!!

    Peace.

    Fla SD.

    • My hubby grew up in the South Pacific and can spear fish far better than with a rod and reel. Thanks for a great list of must-have practical skills. As some of my readers have pointed out, no one can take away your skills and knowledge.

    • What a great idea to educated yourself in mechanics for at least your own car! My husband is a chaplain so is not always that most practical skill set, although they should be!

  12. The value of the dollar will decrease in order to compete with China and Americans will have to work for less. Things will be less cushy from now on (no matter who is in government). You will have to work longer hours with less pay and less perks. The US simply cannojavascript:%20postComment(0);t compete with China and keep the status-quo. You'd better get used to it folks. The US is in decline as a world power and may even break up into several countries when the Federal government loses the respect of the people outside washington.

  13. He-he I am already out of Dodge. Live in a small town in New Mexico with the Rio Grande is my back property line. Have a small group of friends that will band togather if things head south.

  14. For those of you interested in precious metals, check out http://bullion.nwtmint.com/index.php I’ve been buying and selling with them for over 10 years now. Their prices include shipping and insurance and have the lowest over spot markup I've found. And best of all…

    “Sales of gold, silver, palladium and platinum are delivered promptly and are kept private and confidential. No reports to 3rd parties are made.”

    • At around the turn of the century the president bought everyone’s gold. The only gold they didn’t take was gold coins. They thought they were more of a collector’s item, but they don’t have as much gold as other forms. Anyone know about that? Before you had to had it in or face a huge penalty and sometimes prison time. I think it had to do with having our currency being backed up by gold which they gave up a little later. Now they just print more which is what is going to cause the inflation problem if we don”t stop it.

      • Sorry, I can’t type. I meant you had to hand it in or end up with a large monetary penalty or jail time.

  15. hey i know hyperinflation is bad but how bad and what really is it i hear junk 90% silver is the best way to prepare for hyper inflation how fast is it comeing and will this resort to people killing each other for resorses? i need to know how to survive if this dose happen i would hate to kill some one else for food! i got assult rifels but i am not out to kill how do i survive the economice colapse?

    • Prepare now, Matthew. It may not be an all-out collapse, but if you can stock up on what you need to stay alive, it will buy you time until society settles into some sort of order. You need to have food stored — at least three months worth. You need water stored. The guns and ammo are fine, but make sure you're getting range practice at LEAST twice a month, preferably ever week. Stock up on things like toiletries, toilet paper, soap, and be sure you can survive if the power ever goes out for more than just a few hours. Pay off debt, save money, but also buy some silver and gold, if you can afford it. That will preserve whatever wealth you have — even if it's just a couple thousand dollars. If you own an ounce of gold now, and it goes for 5K an ounce at some point in the future, you'll think you were a genius for buying it back when it was 'only' $1700.

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