RPF0666-How_to_Prepare_for_the_Coming

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00:00:30.620 | It is official.

00:00:32.260 | In the United States, the yield curve has inverted.

00:00:35.600 | The 90-day T-bill interest rate is now higher

00:00:40.000 | than the 30-year T-bond rate, barely.

00:00:43.600 | And so we now have an inverted yield curve,

00:00:47.380 | which is an excellent sign that we look to

00:00:50.180 | to predict a future and coming recession.

00:00:53.920 | So today on Radical Personal Finance,

00:00:55.480 | I think it's timely that I talk to you

00:00:57.220 | about how to prepare for the coming recession.

00:01:01.060 | ♪

00:01:17.040 | Welcome to Radical Personal Finance,

00:01:18.480 | a show dedicated to providing you with the knowledge,

00:01:20.080 | skills, insight, and encouragement you need

00:01:22.280 | to live a rich and meaningful life now

00:01:24.680 | while building a plan for financial freedom

00:01:26.280 | in 10 years or less.

00:01:27.820 | Today on the show, we're gonna talk about avoiding catastrophe

00:01:31.020 | because I'm gonna talk to you about avoiding

00:01:32.980 | the catastrophic or potentially catastrophic effects

00:01:35.960 | of a recession on your financial life.

00:01:38.060 | I'm gonna give you the strategies, the steps,

00:01:39.960 | and the actions that you need to take to prepare now.

00:01:42.900 | ♪

00:01:49.400 | If you are not familiar with the concept

00:01:51.080 | of the inverted yield curve,

00:01:52.400 | it has been in the past decades

00:01:54.240 | one of the more reliable indicators of recession.

00:01:58.040 | And the most important thing is when the 90-day T-bill rate

00:02:01.420 | rises above the 30-year Treasury bond rate.

00:02:05.180 | So I want you to imagine what that means.

00:02:06.560 | That means that if you give money

00:02:09.060 | to the United States government,

00:02:10.800 | you are promised a lower rate of return

00:02:14.100 | if you give that to the government for 30 years

00:02:17.000 | than if you give it to the government for 90 days.

00:02:20.600 | That violates all of the normal expectations

00:02:23.900 | about investing.

00:02:24.900 | You say, "Well, I'll give you my money,

00:02:26.100 | but pay me 2% for 90 days,

00:02:27.640 | but pay me 6% for 30 years."

00:02:29.340 | Well, when that gets out of whack

00:02:31.420 | and you have people saying, "Pay me 2% for 90 days,

00:02:34.240 | but pay me 1.5% for 30 years,"

00:02:36.380 | it signals that people are more interested

00:02:39.480 | in the return of their money and safety

00:02:42.520 | than the return on their money.

00:02:44.120 | And this particular inverted yield curve

00:02:46.820 | has historically, fairly predictably,

00:02:50.200 | been a signal of coming recession.

00:02:52.740 | Now, it's not exclusive.

00:02:53.840 | There's no guarantee.

00:02:55.200 | I always try to keep in the back of my mind

00:02:57.840 | that quip that economists have successfully predicted

00:03:00.740 | 28 of the last seven recessions

00:03:02.580 | or whatever your version of that is.

00:03:04.740 | And I think it's true.

00:03:05.580 | I think certainly fears and concerns

00:03:08.280 | over recession can be overblown.

00:03:10.120 | All a recession means

00:03:11.260 | is that the gross domestic product decreases

00:03:13.820 | for, what is it, two quarters, two consecutive quarters?

00:03:15.820 | That's all it means.

00:03:16.820 | So it doesn't mean that the end of the world is here.

00:03:18.300 | It doesn't mean that people are going to be

00:03:20.100 | pointing guns at your house and stealing your food.

00:03:22.560 | It doesn't necessarily have to be extremely catastrophic,

00:03:26.000 | and we don't necessarily have to even be right.

00:03:27.800 | It's possible that things could change,

00:03:29.240 | and there may not be a recession.

00:03:30.740 | Predicting the timings of the movements

00:03:33.540 | and the aggregate indicators

00:03:35.400 | of hundreds of millions of people's

00:03:37.180 | individual financial activities is, of course,

00:03:39.540 | a very difficult and risky business.

00:03:42.180 | So I want to start today by talking about recession

00:03:45.260 | and talk to you about my planning philosophy

00:03:48.120 | when it comes to things like recession.

00:03:50.120 | You'll notice that in that intro,

00:03:51.260 | I said, "The coming recession."

00:03:54.220 | Long listeners of the show know

00:03:55.660 | that I actually have a course called

00:03:57.060 | How to Survive and Thrive

00:03:58.660 | During the Coming Economic Crisis.

00:04:01.340 | And that sounds extremely sensational

00:04:03.580 | when I say, "The coming recession."

00:04:06.140 | And I intend it that way.

00:04:07.580 | I want to grab your interest.

00:04:08.980 | I want to be sensational.

00:04:10.340 | But astute listeners will always notice

00:04:13.280 | that I never personally assign a specific time period.

00:04:16.320 | And although I have a fairly

00:04:20.580 | catastrophic-sounding course,

00:04:21.960 | How to Survive and Thrive

00:04:22.820 | During the Coming Economic Crisis,

00:04:24.500 | that course is extremely practical,

00:04:26.960 | and there is not a single prediction of a single date.

00:04:30.660 | And just like today, I'm not making,

00:04:32.000 | I'm not competent to make any prediction

00:04:34.100 | of any certain date.

00:04:35.480 | All I know is that a recession is coming.

00:04:38.500 | When it comes, I don't know.

00:04:40.400 | And it could be, you could allege

00:04:42.140 | that's kind of a weasely statement

00:04:43.640 | because you can at any time say

00:04:46.080 | that a recession is coming,

00:04:47.080 | even if you're in the middle of a recession,

00:04:48.760 | and you may be right.

00:04:49.580 | You're gonna be right,

00:04:50.420 | bear with me.

00:04:51.260 | It might take 10 years,

00:04:52.080 | but you're gonna be right at some point.

00:04:53.080 | There will be a recession.

00:04:54.860 | We live in an economy where,

00:04:56.420 | due to the way the economy has managed and influenced,

00:04:58.900 | we go through periods of boom times and bust times.

00:05:02.100 | So that's where we live.

00:05:03.160 | That's what we do.

00:05:04.220 | But it is important to remember

00:05:06.360 | that recessions are nothing new.

00:05:07.560 | They come along just like buses, pretty regularly.

00:05:10.300 | But yet it's been quite a while

00:05:11.940 | since we've had a recession in the United States.

00:05:15.300 | It goes back to 2008, 2007, 2008, 2009,

00:05:18.660 | that period there was the last time

00:05:20.460 | that we officially had a recession in the United States.

00:05:23.540 | And so if you think about it,

00:05:25.180 | there's actually a whole generation of people today

00:05:27.900 | who have never experienced a recession,

00:05:29.740 | who haven't gone through a recession.

00:05:31.300 | And I want to prepare you for that

00:05:33.260 | by talking to you about the planning steps

00:05:35.660 | for you to be thinking about to prepare for recession.

00:05:39.060 | Because recessions can be really, really difficult.

00:05:42.340 | Now, I will never make my bets

00:05:44.620 | based upon something that has to happen.

00:05:47.220 | I, with the exception of perhaps some speculative moves

00:05:50.980 | that you want to make, which there is a place for that

00:05:54.180 | in your investing life and your business life,

00:05:56.340 | I generally, being a fairly conservative person,

00:05:58.900 | I want to have a plan no matter what happens.

00:06:02.180 | So I'm not going to make my bet upon

00:06:03.920 | recession coming in 2019, or recession coming in 2020,

00:06:06.900 | or recession has to come in 2021.

00:06:08.900 | I'm not going to give myself over to a prediction

00:06:11.540 | of recession coming in 2020,

00:06:13.420 | and then find myself in 2021 with a booming economy

00:06:17.040 | and then I've got no participation in that.

00:06:20.340 | I make my bets based upon being prepared for whatever comes.

00:06:24.460 | And everything in this show,

00:06:26.500 | every step I'm going to talk to you about

00:06:29.220 | will be practical and useful,

00:06:31.620 | and it will not hurt you to do,

00:06:34.340 | even if recession doesn't come.

00:06:36.940 | The only thing that you will lose,

00:06:39.560 | at the worst case scenario,

00:06:41.420 | by following the recommendations that I give in today's show

00:06:45.540 | is some time from your schedule.

00:06:48.220 | Perhaps you won't quite get through the latest series

00:06:50.820 | on your subscription TV plan

00:06:53.580 | because you're doing some financial work instead.

00:06:56.420 | Or perhaps in theory, with some of my suggestions,

00:06:58.960 | you might pay a few more dollars in interest

00:07:02.420 | on maintaining some of your debt

00:07:03.860 | or something in the coming months.

00:07:05.100 | But beyond that, I'm not going to give you

00:07:06.580 | a single suggestion in this show that will cost you,

00:07:10.100 | that will be bad for you if recession doesn't come.

00:07:14.180 | So I am concerned that recession may come.

00:07:18.180 | It may come fairly soon.

00:07:20.380 | And I think there are very good reasons to think

00:07:22.980 | that the next recession in the United States

00:07:25.500 | could be a very significant and deep one.

00:07:28.360 | But I'm swayed by the arguments in that direction,

00:07:31.620 | personally.

00:07:32.700 | But I'm not going to bet the farm

00:07:34.420 | on that being the absolute guaranteed plan.

00:07:37.060 | I'm going to be prepared

00:07:37.920 | if there's a deep, long, hard recession.

00:07:39.940 | I'm going to be prepared if there's a mild, short recession.

00:07:42.980 | I'm going to be prepared if there's no recession.

00:07:45.220 | And I'm going to make sure that I have plans in place

00:07:47.400 | for all of those.

00:07:48.580 | And that's what I invite you to come along with me

00:07:51.060 | in today's show.

00:07:52.300 | I want to give you additionally a few important reasons

00:07:55.940 | to prepare for recession.

00:07:58.500 | You may not remember the depth and pain

00:08:01.180 | of the most recent recession,

00:08:03.340 | because perhaps for you,

00:08:04.300 | it wasn't a deeply painful experience.

00:08:06.820 | But it was a deeply painful experience

00:08:09.580 | for many millions of people.

00:08:11.860 | And recessions hurt.

00:08:14.280 | People get hurt during times of bad economics.

00:08:20.460 | And those hurts can go deep,

00:08:23.420 | and they can have broad ranging ripple effects.

00:08:26.560 | There was an entire generation

00:08:30.200 | that was transformed for their entire lifetime

00:08:33.340 | by their experiences in the Great Depression.

00:08:36.780 | If you interact with your parents and your grandparents

00:08:39.100 | who went through the Great Depression,

00:08:40.500 | almost every person could,

00:08:42.140 | for the rest of those people's lives,

00:08:43.980 | point to the things that they did

00:08:46.180 | because of their experience in the Great Depression.

00:08:48.620 | It transformed an entire generation.

00:08:52.100 | It transformed the politics of the nation.

00:08:55.220 | If you go back and you study US American history,

00:08:57.660 | the Great Depression was a deciding point

00:09:00.800 | in the change in the direction of the US political system.

00:09:07.460 | It turned my grandparents

00:09:08.620 | into diehard lifelong Democrats.

00:09:11.820 | Franklin Delano Roosevelt

00:09:13.020 | and his work during the Great Depression

00:09:14.260 | turned an entire generation of people

00:09:16.300 | into lifelong diehard Democrats.

00:09:19.020 | And it completely changed the political system.

00:09:21.740 | Now, it's interesting to look and say,

00:09:22.820 | "Well, what actually happened?"

00:09:24.180 | But the reality is none of that matters.

00:09:26.620 | It did change people.

00:09:28.420 | And recessions hurt.

00:09:30.980 | When people are in financial distress,

00:09:34.180 | there's almost nothing good that comes from it.

00:09:36.420 | As your stress levels rise,

00:09:37.900 | your health is likely to go down.

00:09:39.540 | The stress creates acid in your body.

00:09:41.260 | It causes you to be unhealthy,

00:09:42.620 | causes you not to sleep well.

00:09:44.100 | People start drinking more,

00:09:45.820 | abusing drugs more to try to escape,

00:09:47.860 | watching more TV,

00:09:48.900 | doing things that are unhealthy

00:09:50.020 | to try to deal with the stress.

00:09:51.540 | All of that has a ripple effect in their life.

00:09:53.700 | Family relationships are often harmed.

00:09:55.460 | It's a whole lot easier to yell at your children

00:09:57.500 | and abuse your children when you're feeling stressed

00:09:59.920 | than it is when you feel good.

00:10:01.900 | It's a whole lot easier for the things

00:10:03.920 | that your spouse does that,

00:10:05.980 | in good times, they don't really bother you.

00:10:07.660 | It's a whole lot easier to blow up and yell at them

00:10:10.060 | when they do something,

00:10:11.340 | when you're feeling intense stress.

00:10:13.260 | The financial impacts of a recession go long and deep.

00:10:19.380 | If you start missing payments,

00:10:21.820 | your credit score is destroyed.

00:10:23.060 | That has an effect for years.

00:10:25.260 | You lose your house, you get foreclosed.

00:10:26.700 | That can have an effect on your family for years.

00:10:29.580 | Can have an effect on your ability

00:10:30.940 | to buy another house for years.

00:10:34.780 | When you lose your job,

00:10:35.700 | it can have an effect on your career for years.

00:10:38.140 | And if you lose your job in the middle of a recession

00:10:40.220 | and you have several years of either no earnings

00:10:42.740 | or subpar earnings,

00:10:44.700 | that will have a dramatic ripple effect

00:10:46.420 | throughout your life.

00:10:47.260 | You can't save as much money,

00:10:48.220 | can't invest as much money.

00:10:49.620 | Even things like your social security credits

00:10:51.460 | are messed up by that.

00:10:53.860 | So recessions hurt,

00:10:57.820 | but they don't have to hurt you

00:11:00.540 | as much as they might hurt other people

00:11:03.180 | if you are prepared.

00:11:05.340 | And always remember this,

00:11:07.060 | the best way to help the poor

00:11:10.260 | is to start by not being one of them.

00:11:12.520 | The best way to help those who are hurting

00:11:16.300 | is to start by not being one of them.

00:11:18.900 | So collectively, you and I have an opportunity

00:11:25.020 | to prepare so that we are positioned

00:11:27.300 | to help our neighbors during what could be

00:11:30.600 | a very difficult time.

00:11:32.460 | I've worked hard to strengthen myself

00:11:35.300 | so that I can help you if you are in a weaker position.

00:11:39.220 | Now I want to strengthen you

00:11:41.220 | so that you'll be in a position to help your neighbor

00:11:44.280 | if they're in a weaker position.

00:11:46.060 | And that's how one by one,

00:11:47.980 | we can impact one another

00:11:49.540 | and we can help one another

00:11:51.400 | and we can collectively build stronger communities.

00:11:54.780 | I'll repeat for you again,

00:11:57.040 | one of my favorite lines

00:11:57.940 | from my friend Jonathan Walton's poetry.

00:12:00.400 | "We are people pebbles tossed into a pool.

00:12:03.120 | "Every ripple I create in turn ripples you.

00:12:06.400 | "So in unison we are rippling,

00:12:08.420 | "a type of ripple rhythm,

00:12:09.860 | "but we need to ripple in a way that benefits our living."

00:12:13.340 | So I'm hoping to impact you in today's show

00:12:16.440 | with some very useful, thoughtful things

00:12:19.100 | that you can do to prepare for the coming recession.

00:12:22.900 | The number one most important thing that you can do

00:12:26.620 | to prepare for the coming recession

00:12:29.020 | is to focus on maintaining your job,

00:12:32.740 | maintaining your employment,

00:12:34.900 | maintaining your income.

00:12:37.420 | That is your number one highest priority in a recession

00:12:40.620 | is to maintain your income.

00:12:43.360 | If you do nothing else that I recommend,

00:12:48.500 | but you maintain your job,

00:12:50.460 | your life and your lifestyle during a recession

00:12:54.020 | is likely to be just about the same as it is now.

00:12:57.280 | But if you lose your job,

00:13:01.340 | everything else in your life is impacted.

00:13:04.940 | So your highest priority in a recession

00:13:08.260 | or preparing for a recession is to maintain your job.

00:13:12.260 | Now, how do you do that?

00:13:13.140 | Well, there are a number of things that you can do,

00:13:14.420 | but first recognize there's not the time to be a slacker.

00:13:17.060 | And if you're gonna slack off at work,

00:13:18.180 | this is not the time.

00:13:19.300 | You want to make sure that you are on the list of employees

00:13:23.300 | who is always seen as the most valuable employees.

00:13:26.140 | If people are gonna be cut,

00:13:27.140 | you wanna be the last to be cut.

00:13:29.140 | Because if you can maintain your income through a recession,

00:13:32.540 | the recession won't personally impact you all that much.

00:13:36.620 | But if you can't, you will remember the recession.

00:13:39.560 | So how do you maintain your job?

00:13:42.060 | Well, this is gonna be one of the most important things

00:13:44.820 | I'm gonna release in the coming days.

00:13:46.660 | I'm gonna re-release a replay of three shows

00:13:49.460 | I recorded several years ago

00:13:51.120 | that's entirely focused on this specific question.

00:13:54.660 | It's that important.

00:13:56.100 | So I think that that three to four hours of audio

00:13:59.440 | on this one question is going to be sufficient to answer it.

00:14:02.220 | So I'm gonna breeze over it today.

00:14:04.060 | But recognize that you are in competition

00:14:07.340 | with your coworkers and with all of the other

00:14:10.700 | potential people that are available in the marketplace.

00:14:13.700 | Remember that employees compete with employees for work.

00:14:18.200 | Employers and employees are not in competition

00:14:20.620 | with one another.

00:14:21.660 | They collaborate, they work together.

00:14:23.540 | But employers do compete with employers

00:14:26.260 | and employees do compete with other employees.

00:14:29.020 | When you go and apply for a new job

00:14:32.020 | that you're trying to get,

00:14:33.420 | you simply have to be better

00:14:35.420 | than all of the other applicants for that job

00:14:37.740 | and show that you're a better fit,

00:14:39.100 | you're a better candidate.

00:14:40.220 | That's your job.

00:14:41.040 | That's how you get the job.

00:14:42.420 | And so the same thing happens

00:14:44.220 | when you are on the list for being cut.

00:14:49.020 | Corporate executives and leaders look down and say,

00:14:52.220 | we're having problems.

00:14:53.460 | Sales are going down.

00:14:54.380 | That's what, when gross domestic product contracts,

00:14:57.900 | what that's measuring is that sales in different companies

00:15:01.060 | and different industries are decreasing.

00:15:02.820 | Companies are not able to sell and produce

00:15:05.020 | as much product as they otherwise are.

00:15:08.060 | So when sales contract,

00:15:10.340 | that starts to eat into the profit margins of a company.

00:15:13.020 | And so the managers of that company start to look and say,

00:15:15.180 | well, what's happening?

00:15:16.420 | And as they look at their profit margins being squeezed,

00:15:19.420 | they usually will wait a little bit

00:15:21.540 | to see whether this is just a temporary thing.

00:15:23.580 | After all, sales can wander around all the time.

00:15:25.740 | Some people have seasonal sales problems.

00:15:27.500 | They sell more in winter than in summer, et cetera.

00:15:29.660 | And so they wait to see what's happening.

00:15:32.540 | As the managers see that the sales decline is continuing,

00:15:35.940 | then they start to make plans.

00:15:37.340 | Now they may not act right away.

00:15:39.220 | Most companies would maintain some kind of reserves.

00:15:42.060 | They may start to eat into those reserves

00:15:44.180 | because they've built a company infrastructure

00:15:47.100 | that they feel serves their needs,

00:15:48.980 | and they wanna maintain it.

00:15:50.100 | They don't immediately wanna start axing things.

00:15:52.700 | But if sales continue to go down and to stay down,

00:15:55.380 | then company management has to make changes.

00:15:57.940 | They have to start cutting expenses.

00:16:00.060 | The only way to maintain profitability

00:16:02.260 | if sales are going down is to either increase sales

00:16:06.660 | or to cut expenses.

00:16:08.580 | So if the company managers can't figure out a way

00:16:10.460 | to increase sales, they then have to go to expenses.

00:16:13.340 | Now, when you look at expenses

00:16:14.980 | and you look at many companies, if not most companies,

00:16:17.780 | the single greatest expense that most companies face

00:16:20.580 | on an ongoing basis is generally going to be

00:16:23.220 | the cost of employees.

00:16:25.180 | Employees are extremely expensive.

00:16:27.860 | Not only is it your salary, but it's your benefits.

00:16:30.740 | It's also the plant and equipment necessary

00:16:32.580 | for you to do your job.

00:16:33.740 | And employees are also some of the most easily adjusted,

00:16:38.380 | maybe too strong of a statement,

00:16:39.980 | but there's some things that can be easily cut off.

00:16:41.700 | If a company has a big factory

00:16:43.060 | and they need that factory to produce their wares,

00:16:46.580 | it's easier to lay off a third of the factory workers

00:16:49.060 | and then plan to hire them again in two years

00:16:51.540 | than it is for them to sell the factory.

00:16:54.420 | 'Cause building a factory is generally a lot harder

00:16:57.820 | than hiring new factory workers.

00:17:00.060 | Now, don't get me wrong.

00:17:01.300 | Hiring and training good employees is very difficult.

00:17:04.100 | It's extremely expensive and time-consuming

00:17:05.900 | for an employer to do.

00:17:07.780 | But in general, human capital, the employees,

00:17:11.380 | is going to be easier for them to decrease and increase

00:17:14.180 | to keep pace with the times.

00:17:16.260 | So company management is going to sit down

00:17:20.140 | and they're going to look at the cost structure

00:17:21.860 | of their company.

00:17:22.700 | The first thing they'll do is they'll try to trim off

00:17:24.980 | any non-essential workers.

00:17:27.180 | Now, if you are in a job that you don't think is fundamental

00:17:31.020 | and core to the productivity and the profitability

00:17:34.060 | of that company, that probably means you

00:17:36.900 | as a non-essential worker.

00:17:38.980 | And so you should be prepared for that.

00:17:41.820 | This is why if you're involved

00:17:43.660 | in a highly compensated position

00:17:45.220 | where you are directly impacting the productivity

00:17:47.900 | and profitability of the company,

00:17:49.140 | you're much more likely to keep your job

00:17:51.020 | than if you're just an ancillary assistant.

00:17:53.500 | If you work as an assistant to a mid-level manager,

00:17:57.180 | chances are that mid-level manager can get by

00:17:59.380 | without an assistant, or they can lay off three assistants

00:18:02.620 | and bring on and have one assistant

00:18:04.540 | serve four mid-level managers.

00:18:06.340 | But if you're a key and star salesman for the company,

00:18:09.420 | they can't lay you off.

00:18:10.540 | First of all, of course, you have the benefit

00:18:12.260 | that your compensation is directly tied

00:18:14.420 | to the profitability of the company.

00:18:16.620 | They know how much to pay you because they only pay you

00:18:19.100 | when money comes in, and they need you

00:18:21.740 | because they need income to rise.

00:18:23.780 | They're going to maintain profitability

00:18:25.260 | either by increasing income or decreasing expenses.

00:18:28.060 | As a salesman, you help to increase income.

00:18:31.540 | So non-essential jobs, non-essential positions

00:18:34.020 | are largely going to be cut.

00:18:36.700 | The other thing that's going to happen

00:18:38.020 | is the managers will look at a recession

00:18:40.500 | as an opportunity to conveniently,

00:18:42.580 | without a lot of stress, without a lot of bad press,

00:18:45.740 | to conveniently make the company more efficient.

00:18:48.460 | What tends to happen during periods of expansion

00:18:51.260 | in a good, booming business cycle

00:18:54.100 | is managers, in preparing for future growth,

00:18:57.220 | tend to overhire.

00:18:58.620 | And they wind up with people who,

00:18:59.900 | yeah, they're doing something,

00:19:00.900 | but they're not particularly important.

00:19:03.220 | And so when you go into a recession,

00:19:05.420 | you have a convenient opportunity

00:19:06.900 | to get rid of the people who are poor performers,

00:19:09.980 | to get rid of and streamline some of the jobs

00:19:12.500 | and make things more profitable.

00:19:14.460 | And so it's a really unique opportunity

00:19:16.700 | where you can do that where people understand.

00:19:18.500 | If you start laying people off

00:19:19.780 | when there's a good economy, et cetera,

00:19:21.340 | then the workers say, "What's going on here?"

00:19:23.060 | But if you lay people off in a recession,

00:19:24.700 | the rest of your workforce is going to be

00:19:26.380 | more understanding of your moves as a manager.

00:19:29.780 | So if the CEO says to each of the department heads,

00:19:32.820 | "You need to trim your expenses by 20%,"

00:19:35.260 | well, the department heads can simply sit down,

00:19:37.180 | look at their employee roster,

00:19:39.300 | and trim off the 20% of the employees

00:19:41.900 | that they don't like, that aren't productive,

00:19:43.420 | that aren't team players,

00:19:44.340 | or whatever their personal criteria are.

00:19:46.580 | So your first job is to make sure

00:19:48.700 | that you're not in that bottom 20%.

00:19:50.820 | This is why it's so important in any job

00:19:52.700 | that you're always in at least the top 20% of the workforce

00:19:55.660 | because almost no company would ever cut positions

00:19:58.420 | in the top 20% of workers.

00:20:00.340 | The company has to go totally bankrupt in that situation

00:20:02.900 | to cut people there.

00:20:04.260 | But if you're in that bottom 20%,

00:20:06.540 | there's a very good chance you're out.

00:20:08.780 | So your job is to be a more important,

00:20:11.980 | valuable employee to your employer

00:20:15.140 | than all of your fellow employees.

00:20:16.740 | You're competing against your fellow employees

00:20:18.760 | to be higher on the list and thus later in the cuts

00:20:22.980 | to be laid off.

00:20:24.180 | Now, this may come in and be a factor also

00:20:27.380 | with regard to your pay.

00:20:29.740 | You can't necessarily predict in all circumstances

00:20:32.060 | it's just based upon performance.

00:20:33.620 | It might be that you are a very highly paid employee.

00:20:36.620 | And this is one of the biggest challenges for older workers,

00:20:40.060 | workers who are established,

00:20:41.140 | who've been at a company for a very long time,

00:20:43.060 | they've generated increases in pay,

00:20:44.820 | they have a lot of pension benefits, et cetera.

00:20:47.760 | Those workers can be very expensive

00:20:49.460 | for a company to maintain.

00:20:51.460 | And so that's also a risk.

00:20:53.220 | So I'm gonna release replay of three episodes

00:20:55.940 | into the podcast feed that are hours and hours

00:20:58.300 | on this subject to help you prepare

00:20:59.780 | for to not get laid off in the coming recession.

00:21:02.620 | I think the titles are

00:21:04.420 | how to not get laid off in the coming recession,

00:21:06.740 | what to do if you just got laid off in the coming recession.

00:21:09.060 | And the third one was,

00:21:10.920 | or how to prepare to get laid off in the coming,

00:21:14.260 | if you get laid off in the coming recession.

00:21:15.700 | And the third one was

00:21:16.540 | what to do if you just got laid off in the recession.

00:21:19.620 | So we'll deal with some of these

00:21:20.460 | career strategies exhaustively.

00:21:22.720 | The key thing for you to recognize

00:21:24.420 | is your number one target, your number one goal

00:21:27.520 | is don't lose your job in the coming recession.

00:21:31.980 | So start thinking about what you can do now

00:21:35.100 | in your current job so that you don't lose your job

00:21:38.620 | in the coming recession.

00:21:40.500 | Now, if you do lose your job,

00:21:43.000 | recognize that this is not necessarily a disaster.

00:21:46.740 | A job loss can be an opportunity in and of itself.

00:21:51.160 | I personally was laid off just prior to the 2008 recession.

00:21:56.860 | And it turned out to be a great blessing for me.

00:21:58.940 | I did not see it coming.

00:22:00.320 | I had been working at a marketing

00:22:01.720 | and brand management consulting company.

00:22:03.220 | I was working as a mid-level analyst,

00:22:05.140 | junior analyst, whatever.

00:22:06.420 | And I had decided that it wasn't a good fit for me.

00:22:09.420 | Basically the industry, the corporate structure

00:22:11.220 | wasn't a good fit for me.

00:22:12.660 | And I was planning to leave in January of 2009

00:22:16.340 | because I just didn't see

00:22:18.680 | how I had any long-term career there.

00:22:20.940 | But I was sticking it out

00:22:21.820 | because I was trying to fulfill my,

00:22:24.660 | I wanted to leave on good terms.

00:22:25.740 | I wanted to have worked there enough

00:22:27.220 | to make my boss a lot of money

00:22:28.500 | for the risks that they had taken in hiring me.

00:22:30.740 | And so I was planning to leave in January of 2009.

00:22:33.340 | I was unexpectedly laid off in June of 2008.

00:22:36.700 | And at the time, I couldn't believe it.

00:22:38.460 | I had gotten great performance reviews.

00:22:40.500 | I had, I thought I was doing,

00:22:41.940 | I'd just gotten a nice pay raise.

00:22:43.200 | I thought everything was good.

00:22:44.860 | And I don't think it was really my fault.

00:22:46.600 | They reorganized the company

00:22:47.660 | and they eliminated all of the people that were at my level.

00:22:51.180 | And they kept the senior level management

00:22:53.060 | and the junior level employees.

00:22:55.620 | And they kind of cut away my level,

00:22:57.660 | but it was a shock.

00:22:58.500 | I did not expect it.

00:23:00.380 | I didn't know what to do

00:23:01.220 | 'cause I didn't have a clear plan.

00:23:02.440 | I had some ideas of what I wanted to do,

00:23:04.480 | but it wound up in hindsight

00:23:06.100 | being a tremendous blessing for me

00:23:08.180 | because the recession hit in the fall of 2008.

00:23:11.580 | And that was when the world was falling apart.

00:23:13.820 | And I remember that in,

00:23:16.540 | as I looked in January of 2009,

00:23:18.380 | I looked around and I said to myself,

00:23:19.580 | "You know what?

00:23:20.780 | If I were still working,

00:23:22.020 | I would not have the guts to quit in January of 2009.

00:23:27.020 | I would be so scared by the economy

00:23:30.860 | and the recession and whatever

00:23:32.500 | that I wouldn't have been able to follow through

00:23:33.680 | on my own plans."

00:23:34.520 | And so it turned out to be a great blessing to me.

00:23:37.020 | And I remember in the fall of 2008,

00:23:39.180 | I had decided to become a financial advisor.

00:23:40.860 | I'm driving to classes and taking classes.

00:23:42.660 | And every day I'm driving home.

00:23:45.020 | I was commuting back and forth to Miami

00:23:46.980 | and I'm driving home,

00:23:48.300 | hour, hour, hour and a half in the car,

00:23:50.820 | listening to NPR talk about TARP

00:23:53.180 | and deal with the financial crisis and everything.

00:23:56.300 | And I started my career in the depths of a recession

00:23:59.580 | as a financial advisor.

00:24:01.220 | And I built it all through the period.

00:24:03.140 | And so I just simply say from personal experience

00:24:05.600 | that if you do lose your job,

00:24:06.820 | it can be an opportunity.

00:24:08.820 | But it's most likely to be an opportunity

00:24:10.780 | if it's one you're prepared for.

00:24:12.660 | Because if I had not been financially prepared

00:24:15.180 | for being laid off,

00:24:16.260 | I was out of debt,

00:24:18.100 | I had a big emergency fund,

00:24:19.140 | I had a very simple life at the time,

00:24:20.420 | I had few obligations,

00:24:22.100 | was a single man,

00:24:23.220 | but being out of debt,

00:24:24.300 | having a big emergency fund,

00:24:25.740 | six months of expenses, et cetera,

00:24:27.500 | that made it possible for me to pivot,

00:24:30.660 | to start a new business

00:24:32.860 | where I didn't earn any income in the beginning

00:24:35.060 | and build to where I ultimately do today.

00:24:38.820 | But financial planning makes a difference.

00:24:40.740 | And so that's why we're gonna talk about financial planning

00:24:42.860 | in detail now.

00:24:44.940 | Step one of preparing for a recession is

00:24:47.060 | make sure you focus and don't lose your job.

00:24:50.140 | Step two is this,

00:24:51.100 | today, make a plan of what you would do

00:24:54.540 | if you lost your job.

00:24:57.420 | If you're a dual income household,

00:24:58.900 | what would you do if you both lost your jobs?

00:25:03.260 | What would you do if today,

00:25:04.580 | you got called into your boss's office

00:25:06.580 | and your boss said,

00:25:07.540 | "Thank you very much for your service.

00:25:09.020 | You've been a great worker,

00:25:10.300 | but unfortunately we can't keep you."

00:25:13.320 | And you're laid off.

00:25:14.420 | You have a cardboard box,

00:25:15.420 | you pack up and you're ushered out the door by security.

00:25:17.340 | What would you do in that circumstance?

00:25:20.900 | I want you to think this through very, very carefully.

00:25:24.860 | And what we're doing here is called war gaming.

00:25:27.940 | I want you to imagine and plan

00:25:29.860 | what you would do in that circumstance if you had to.

00:25:32.820 | And that way you'll be prepared to do it

00:25:37.380 | when you have to, if you have to.

00:25:40.340 | And this mental exercise

00:25:42.820 | makes all the difference in the world.

00:25:45.340 | I'll tell you too, I thought it was funny,

00:25:48.300 | an embarrassing anecdote of how big of a deal this makes.

00:25:52.780 | In 2008, when I got laid off,

00:25:56.580 | prior to that time,

00:25:57.820 | I had been deeply influenced by Dave Ramsey's books

00:26:01.420 | and his programs.

00:26:03.140 | I had organized,

00:26:04.480 | I bought his Financial Peace University program.

00:26:06.620 | I organized a group of my friends.

00:26:08.100 | I paid for all this stuff

00:26:08.940 | and I took a group of my friends

00:26:09.960 | through Financial Peace University.

00:26:11.380 | And in that iteration of Financial Peace University,

00:26:14.220 | I have no idea if it's still in his current versions

00:26:16.420 | of those courses, but in that course,

00:26:18.300 | when he was talking about the value

00:26:19.980 | and the importance of an emergency fund,

00:26:21.940 | he made a humorous anecdote about what it would be like

00:26:25.380 | if you got laid off and you had an emergency fund.

00:26:27.260 | And he said something analogous to this quote.

00:26:30.060 | He said, "If you've got a six months of emergency fund

00:26:32.700 | "and you get called into your boss's office

00:26:34.300 | "and you get laid off, you can just laugh and say,

00:26:37.020 | "'Well, that's okay, how big's the severance?'"

00:26:39.260 | And it was a funny joke 'cause,

00:26:41.020 | hey, I'm not so concerned about losing my job

00:26:43.180 | because I have six months of expenses saved up.

00:26:46.300 | And I'm out of debt.

00:26:47.620 | And it stuck with me.

00:26:48.540 | I remember things very easily when I hear them

00:26:51.180 | and it stuck with me.

00:26:52.140 | And so I remember I was so shocked

00:26:54.800 | when I was getting laid off.

00:26:55.900 | I'm sitting there looking at the president of the company

00:26:58.020 | and the executive vice president or whomever.

00:27:01.140 | I'm sitting there looking at them.

00:27:02.180 | And at first I didn't understand what was happening.

00:27:04.140 | I had no concept that I was being laid off.

00:27:06.380 | And then I realized I was being laid off

00:27:08.620 | and they were very solemnly going through

00:27:11.100 | and saying whatever their politically,

00:27:16.100 | oh, we can't, I don't know what their political stuff was,

00:27:18.580 | you know, that HR cover your butt stuff.

00:27:22.540 | And finally I realized I'm being laid off and I just,

00:27:26.100 | I laughed and I said to their face, I went,

00:27:29.500 | "How big's the severance pay?"

00:27:31.140 | And they both looked at me.

00:27:32.900 | I still remember, they both looked at me shocked at my joke

00:27:36.420 | and I immediately backpedaled and I said, "I'm sorry."

00:27:38.860 | And I explained that, "I'm sorry.

00:27:42.220 | I just spent the last couple of years of my life

00:27:44.580 | getting out of debt.

00:27:45.660 | I worked really hard and I've done nothing but save money.

00:27:48.940 | And I, you know, just a few months ago,

00:27:50.700 | I saved six months worth of expenses."

00:27:52.620 | And that was, I did it to be prepared

00:27:55.420 | in case I ran into a significant financial problem like this.

00:27:59.260 | And I explained that I heard Dave Ramsey say this thing

00:28:01.660 | about how big's the severance.

00:28:02.940 | And so it diffused it, but that's how big of a difference.

00:28:06.460 | That's how big of an impact war gaming

00:28:08.180 | can make on your life.

00:28:09.460 | You might even just say verbatim what I just said.

00:28:12.540 | But if you will think things through in advance

00:28:14.700 | of what would I do in that circumstance,

00:28:16.620 | you'll be prepared to move quickly.

00:28:18.700 | So here are my questions for you.

00:28:19.660 | That's what we're doing.

00:28:20.980 | Thus, the scenario is simple.

00:28:22.940 | You just got fired.

00:28:24.860 | How would you cut your expenses immediately

00:28:28.420 | so that you could live on your income?

00:28:30.160 | If you're a dual income household,

00:28:31.420 | how would you cut your expenses by 50%?

00:28:34.100 | What would you do?

00:28:35.260 | What would you cut?

00:28:36.420 | How would you get another job quickly?

00:28:38.620 | What would you do if both you and your spouse,

00:28:40.780 | if you're a dual income household,

00:28:41.820 | if both of you came home and you said,

00:28:43.380 | "Hey, I got news."

00:28:44.500 | And she says, "I've got news."

00:28:46.340 | And both of you lose your income.

00:28:48.280 | How would you do that?

00:28:49.500 | Or if you're running a business,

00:28:50.860 | what would you do if your business revenues

00:28:53.500 | would decline by 50%?

00:28:55.540 | And I think 50% is a useful metric to use.

00:28:58.460 | There's nothing precise or academic about it.

00:29:00.340 | Just that it's a lot.

00:29:02.020 | It's pretty severe to lose 50% of your income.

00:29:04.460 | It's really severe.

00:29:05.580 | It's a lot harder to figure that out

00:29:06.860 | than what would I do if I had a 10% cut.

00:29:08.420 | You could have a 10% cut immediately,

00:29:10.020 | but it's not so desperate as 0%.

00:29:11.740 | So it gets you in the mindset of cutting.

00:29:14.420 | It's also very useful to think about

00:29:16.300 | because many people might be able to,

00:29:19.940 | let's say you're gonna get laid off

00:29:21.260 | and you're concerned about it.

00:29:22.500 | You might be able to negotiate

00:29:23.620 | simply taking a pay decrease.

00:29:25.500 | Perhaps your company would like to keep you,

00:29:27.120 | but if you'll take a 35% pay cut, they'll keep you,

00:29:30.300 | but they won't at your current salary.

00:29:31.900 | So you might be able to keep some of your income.

00:29:33.780 | It's also an important number

00:29:34.820 | because many people could replace 50% of their income

00:29:37.860 | through either taking another job quickly

00:29:40.180 | or through taking some kind of side work,

00:29:42.700 | side hustles, part-time work,

00:29:44.420 | putting together a mishmash of part-time jobs

00:29:46.580 | and just personal hustles in some way.

00:29:49.460 | In general, it'd be unusual,

00:29:51.380 | you'd probably be pretty lazy

00:29:52.880 | to go from 100% of income to 0% of income

00:29:55.500 | and not be able to make anything.

00:29:57.060 | So most people that are motivated and willing to work

00:29:59.300 | at doing whatever is available

00:30:01.040 | could at least make some money.

00:30:02.740 | And so thinking 50% of my pay is gone,

00:30:05.120 | how do I live on 50% puts you in the right mindset.

00:30:08.540 | So I want you to think about that.

00:30:09.980 | What would you do?

00:30:10.940 | How would you cut your expenses by 50% overnight?

00:30:14.220 | I want you to make a plan.

00:30:15.340 | I want you to imagine this through

00:30:16.780 | and ideally write it down.

00:30:18.860 | The scenario is simple, you get fired.

00:30:21.020 | And so just take a few minutes on your lunch break today

00:30:23.680 | and make an action checklist.

00:30:25.040 | You go home, honey, I lost my job.

00:30:27.760 | You walk to your home office and what do you do?

00:30:30.500 | Well, on the way maybe you crank the thermostat

00:30:33.100 | up a few degrees.

00:30:33.940 | Sorry, we can't run the AC at 72 degrees,

00:30:35.740 | we gotta run it at 78

00:30:37.660 | because we can't afford the electricity bill

00:30:40.260 | or flip the AC off or the heater or whatever.

00:30:42.740 | You pull out your cable bill, you call the cable company,

00:30:44.700 | you cancel the cable, you cancel Netflix,

00:30:46.940 | you cancel your subscription boxes,

00:30:49.620 | you cancel the cell phone plans.

00:30:51.580 | We can't do $300 a month on our family plan of cell phones,

00:30:54.760 | we just can't do it, we cancel them.

00:30:56.560 | By the way, if you're ever in that situation,

00:30:59.580 | that's one of the things, most people don't do that

00:31:01.300 | 'cause they don't know how to keep their number.

00:31:02.820 | You can do that by just simply porting your number

00:31:06.660 | either to a prepaid plan or what I recommend

00:31:08.980 | is port that number to something like Google Voice

00:31:11.740 | or some other solution where it's super cheap.

00:31:14.020 | Google Voice charges either 10 or 20 bucks

00:31:15.780 | to port your number in,

00:31:16.860 | but then there's no more ongoing calls

00:31:18.280 | and you can swap your cell phone out all along the way.

00:31:20.900 | It's one of the biggest savings that many people could have

00:31:23.300 | is going from two or $300 a month to $0 a month.

00:31:27.340 | There have been many months where I've maintained

00:31:29.180 | a cell phone just through using apps,

00:31:31.060 | Google Voice, Voice over IP phones, MySudo,

00:31:34.340 | and then switching everything to messaging apps,

00:31:36.620 | whether that's WhatsApp, Facebook, Wire, Signal,

00:31:40.780 | that kind of thing.

00:31:42.140 | By switching everything to messaging apps,

00:31:43.580 | you can cut your cell phone

00:31:44.460 | and that's a big one for many people

00:31:46.780 | when you got a family plan at $200 a month.

00:31:49.100 | So you cancel the cell phone plans that day,

00:31:51.420 | you call the internet company and you say,

00:31:53.020 | well, we're gonna have internet

00:31:54.020 | 'cause I'm gonna be looking for work,

00:31:54.840 | but you drop the internet speeds to slow and cheap

00:31:57.020 | instead of fast and expensive like they are now.

00:32:00.020 | You cancel the lawn service, you cancel the pool service,

00:32:02.020 | you cancel the house cleaner,

00:32:03.220 | you cancel the kids tutors and the piano teachers,

00:32:06.460 | you call the kids private schools and tell them

00:32:08.140 | you're pulling them out at the end of the semester,

00:32:09.540 | you're not gonna make next semester's premium payment

00:32:11.860 | or tuition payment.

00:32:13.580 | You call your life insurance company

00:32:14.940 | and drop the additional premiums off

00:32:16.340 | your life insurance policies and drop them to the basics.

00:32:19.260 | You cancel the restaurant budget,

00:32:20.540 | you drop the food budget by 50%,

00:32:22.100 | you say, we're going to basic foods, staple foods,

00:32:24.720 | cheap foods instead of the fancy pre-prepared foods

00:32:27.640 | that we normally enjoy eating.

00:32:29.720 | You park the second car in the garage immediately,

00:32:31.880 | you drop the insurance on it immediately

00:32:33.640 | 'cause you park it.

00:32:34.880 | You file for unemployment that day,

00:32:36.940 | you sign up for food stamps that day,

00:32:39.480 | you go to the food bank that evening

00:32:40.980 | and you get some food, et cetera.

00:32:42.840 | The point is that plan out what you would do.

00:32:45.400 | That's just cutting the tip of the iceberg.

00:32:47.080 | I'm trying to use generic examples

00:32:48.440 | that would be broadly applicable.

00:32:50.080 | But you look at your budget, you look at your expenses

00:32:52.360 | and say, I've got to cut my household expenses by 50%.

00:32:55.720 | How do I do that?

00:32:57.520 | And the thing is, you want to be ruthless and move fast.

00:33:00.960 | If you lose your job, be ruthless and move fast.

00:33:04.880 | That is painful, but it's less painful

00:33:08.600 | to be ruthless and move fast than it is to kind of say,

00:33:11.960 | well, this is bad and I don't want to upset the family

00:33:14.160 | and I don't want to upset the family budget,

00:33:15.480 | I don't want the kids to be scared.

00:33:17.160 | And so we're just going to wait and keep things as normal

00:33:20.100 | to try to maintain some semblance of normality.

00:33:23.000 | Maybe I'm wrong on this, right?

00:33:25.000 | Maybe 10 years from now when I'm dealing with teenagers,

00:33:27.720 | I'll think differently as a parent.

00:33:29.680 | But as a financial planner,

00:33:31.160 | I have watched this again and again and again.

00:33:34.000 | And there's this idea that somehow parents are immune

00:33:36.800 | from circumstances and if they just hide from their children

00:33:39.600 | that things aren't going well, we just lost our job,

00:33:42.200 | that things will be,

00:33:43.040 | that it'll help their emotional equilibrium.

00:33:45.480 | I don't buy it.

00:33:46.720 | I think emotional equilibrium is maintained

00:33:49.120 | by the quality of the relationship,

00:33:51.660 | the confidence of the person.

00:33:53.020 | And I think that children are perfectly capable

00:33:55.020 | of engaging and helping the family.

00:33:57.100 | It may be that you say, son, I lost my job,

00:33:59.560 | you're out of private school, we're homeschooling,

00:34:01.260 | and what's more, you need a job this afternoon,

00:34:03.220 | let's go start, 'cause now you got to pay for your clothes.

00:34:05.740 | That's fine, that's not child abuse.

00:34:08.980 | And yet from a financial planning perspective,

00:34:10.980 | when people move slow,

00:34:12.500 | they wind up paying for their slowness for years.

00:34:15.700 | Giving you probably the hardest example.

00:34:19.060 | You lose your job.

00:34:20.000 | I think it's better for you to pull your children

00:34:21.940 | out of school, out of the private school immediately.

00:34:25.080 | Finish the semester or whatever you have

00:34:26.740 | with the tuition you've paid up

00:34:27.980 | and then pull them out of school right away.

00:34:29.780 | And so let's say you pull them out for the next semester.

00:34:31.740 | It saves you the tuition payments.

00:34:32.880 | That can be hard to predict based upon school payments,

00:34:34.740 | but the point is you pull them out

00:34:36.100 | and you pull them home and you homeschool for a semester.

00:34:38.420 | And then wind up two months later,

00:34:40.180 | you got a job, another job,

00:34:42.480 | and you're in a situation now where you can easily make it,

00:34:44.380 | well, put them right back into school.

00:34:46.060 | They'll still have all their friends.

00:34:47.500 | They just were at home for two months

00:34:49.060 | and make up the tuition payments

00:34:50.420 | and get them right back in two months later

00:34:52.020 | when you get a better job.

00:34:53.300 | That is a far better scenario to be in

00:34:56.180 | than for you to say, well, I don't want to upset the kids.

00:34:58.840 | And so we're just going to go ahead

00:35:00.420 | and put this semester's payment on the credit cards.

00:35:03.500 | And then all of a sudden now you can't get a job.

00:35:06.020 | The recession grows deeper and longer

00:35:08.100 | and you can't get a job because your industry is roiling

00:35:10.700 | and you weren't prepared to pivot to another industry.

00:35:13.060 | And so now six months you're out of work

00:35:15.460 | and now you've got $15,000 of additional credit card debt

00:35:18.700 | for the kid's tuition payment.

00:35:19.860 | And now you got to pull them out six months later.

00:35:22.580 | And then it takes you another six months to find a job.

00:35:24.700 | And now you've got to take six months, 12 months,

00:35:26.460 | 18 months paying off your debt.

00:35:28.860 | As I talked about in a recent episode on the Back to Basics

00:35:31.860 | where I talked about the problem with debt,

00:35:33.780 | the problem of not moving slow

00:35:35.700 | is that you extend the pain to a long period of time.

00:35:39.660 | If you followed my plan,

00:35:40.760 | you pulled the kids out immediately

00:35:41.940 | whenever your tuition runs out

00:35:43.300 | and you homeschool for two months,

00:35:44.540 | you can put them right back in.

00:35:45.500 | You had two months of pain

00:35:46.620 | or maybe your kids had enjoyed two months of pleasure.

00:35:48.860 | I don't know, sitting at home instead of going to school.

00:35:50.540 | You had two months of pain versus two years of pain

00:35:53.560 | because you move too slow

00:35:54.980 | and you were super stressed the whole way through.

00:35:57.100 | So be ruthless and move fast.

00:36:00.400 | Next, resolve to move quickly

00:36:02.860 | and resolve to make at least enough income

00:36:06.180 | to keep your lean budget going forward.

00:36:09.020 | Resolve to make enough to pay the basics

00:36:12.740 | and set those plans up now.

00:36:14.340 | How would you do it?

00:36:16.260 | If you say, well, I'd go and drive for Uber

00:36:18.420 | or whatever the competitor is

00:36:20.100 | at the time that the recession comes,

00:36:21.820 | then make that plan now.

00:36:24.220 | Research, make sure your car qualifies.

00:36:26.540 | You may even go ahead and get signed up,

00:36:27.940 | become an Uber driver, get the inspection on your car

00:36:30.300 | and drive once every month or two.

00:36:32.300 | That way you're ready to go.

00:36:33.860 | And so you lose your job,

00:36:35.160 | the next day you're in the car for 12 hours

00:36:36.860 | making $4.25 an hour.

00:36:39.100 | But hey, $4.25 an hour

00:36:41.000 | might be enough to pay your mortgage bill.

00:36:43.180 | So make that plan now.

00:36:45.140 | If you're gonna do freelance consulting,

00:36:46.640 | then go ahead and keep those contacts alive.

00:36:48.700 | Make contacts with the person and keep it ready

00:36:50.920 | so that you could, on your way home from your job,

00:36:53.780 | you could call somebody and say,

00:36:56.220 | hey, I know you wanted me to do that gig

00:36:57.660 | and I didn't have time, but I just got laid off.

00:36:59.980 | Can I start on this tomorrow?

00:37:01.540 | Keep things fresh.

00:37:02.380 | Think now about how you generate

00:37:03.860 | some extra income from your house.

00:37:05.820 | Would you rent out the spare bedroom?

00:37:07.940 | Would you move the kids into one bedroom

00:37:09.540 | and rent out the spare bedroom to somebody who needs it?

00:37:12.700 | Then make plans for it now.

00:37:14.380 | Think about it now so that you're ready.

00:37:16.340 | You may not wanna do it now

00:37:17.300 | 'cause you don't need the money,

00:37:18.120 | but hey, an extra $500 a month coming in

00:37:20.220 | from a part-time tenant

00:37:21.700 | could make a big, big difference for you.

00:37:23.900 | Resolve to make at least enough income

00:37:26.620 | and resolve not to go backwards in the recession.

00:37:30.380 | Don't borrow money.

00:37:34.220 | Earn it.

00:37:35.940 | I repeat, don't borrow money.

00:37:42.480 | Earn it.

00:37:43.780 | Again, back to the pain.

00:37:45.840 | Problem with debt.

00:37:46.680 | Go back and listen to that episode

00:37:47.700 | called "Back to Basics, The Problem with Debt,"

00:37:49.180 | something like that, about five, six, seven,

00:37:50.820 | eight episodes ago.

00:37:52.220 | If you borrow money in a recession,

00:37:54.900 | you wind up coming out of the recession broke.

00:37:57.860 | If you work and cut expenses in a worst-case scenario,

00:38:03.420 | you at least come out of the recession

00:38:05.180 | where you were before it.

00:38:06.580 | And then as soon as you get well-employed again,

00:38:08.700 | you can get back on track

00:38:11.020 | instead of having to spend a year or two years

00:38:12.820 | or three years making up for the recession.

00:38:15.760 | This is the exact same problem that governments have

00:38:18.520 | and that the US government is going to have.

00:38:20.880 | If the government would simply let,

00:38:24.320 | back to 2008,

00:38:25.880 | if the banks had simply been allowed to fail

00:38:28.800 | and all of the malinvestment

00:38:31.280 | and the badly placed capital

00:38:33.040 | had been allowed to be destroyed

00:38:35.200 | and taken care of through the markets

00:38:36.840 | and the courts and the bankruptcy process,

00:38:39.320 | the whole thing would have been over.

00:38:41.220 | But because everyone said, "Oh, we're gonna bail it out,"

00:38:43.860 | it would have been a lot of short-term pain.

00:38:46.160 | But within the bailouts,

00:38:47.180 | what we do is we extend the pain out

00:38:49.180 | and now it's decades and decades and decades of pain.

00:38:52.420 | Take the pain, take the pain now,

00:38:55.140 | make it short, make it fast, make it deep,

00:38:57.720 | and then on the other side, rebuild.

00:39:01.860 | So resolve not to go backwards in the recession.

00:39:04.620 | Resolve to work at least enough part-time

00:39:07.580 | to make your way forward.

00:39:08.860 | Don't go backwards, don't lose net worth.

00:39:10.860 | You may not, let me rephrase that.

00:39:13.540 | You may not be able to affect your net worth

00:39:15.160 | because your investments may go down

00:39:17.500 | in their current market value.

00:39:19.680 | So you may not be able to keep from losing net worth,

00:39:22.420 | but don't go cash backwards.

00:39:24.740 | Keep your cash cushion and work, earn,

00:39:27.820 | do whatever is necessary to keep going forward.

00:39:31.020 | Don't go backwards.

00:39:32.300 | Next action step.

00:39:34.340 | If you see recession coming

00:39:37.140 | and you are preparing for recession,

00:39:39.660 | pay attention to the indicators

00:39:42.620 | and start stockpiling cash.

00:39:44.380 | If today you would be in a difficult situation,

00:39:50.360 | if you lost your job,

00:39:51.740 | you need this to be stockpiling cash.

00:39:53.880 | I gave this advice recently to a consulting client,

00:39:56.840 | was paying thousands of extra dollars a month

00:39:59.600 | towards a mortgage payment,

00:40:00.940 | very focused on getting the mortgage paid off

00:40:03.980 | in a couple of years.

00:40:05.300 | I said, "Good job, stop, stockpile cash."

00:40:10.300 | Didn't have enough cash,

00:40:12.260 | didn't have enough in emergency fund,

00:40:14.140 | and was too much at risk of losing the job.

00:40:17.580 | And if he'd lost his job,

00:40:18.980 | it would have been potentially very, very difficult.

00:40:22.420 | So stockpile cash.

00:40:26.140 | You may not be able to predict with certainty

00:40:28.660 | when the next recession is,

00:40:30.480 | but when there are giant yellow lights

00:40:32.220 | flashing all over the economy,

00:40:34.060 | when there are giant yellow lights and this says,

00:40:35.740 | "Hey, this is the inverted yield curve."

00:40:38.580 | And we got the interest rates of 90 day T-bills

00:40:42.280 | above 30 year bonds,

00:40:44.040 | that is a giant warning light for imminent recession

00:40:47.980 | in the coming year, months, years.

00:40:51.720 | But you have enough time to stockpile cash.

00:40:56.500 | So stockpile cash.

00:40:58.600 | If you are not currently stockpiling cash

00:41:01.180 | and you're not currently in a very comfortable situation,

00:41:03.940 | significant investments, significant cash stockpiles,

00:41:06.100 | fully funded emergency funds, et cetera,

00:41:08.180 | this is your time to prepare.

00:41:10.060 | Stop paying extra on debt.

00:41:12.140 | As long as your debt is at reasonable interest rates,

00:41:14.780 | paying 25% debt, credit cards, things like that,

00:41:17.620 | stop paying extra on debt.

00:41:19.180 | Now, keep your momentum towards your debt-freeness,

00:41:22.320 | but stockpile your cash instead.

00:41:24.700 | And it'd be much better for you

00:41:26.980 | to stockpile cash for a year,

00:41:29.420 | and then all of a sudden all the yellow lights go away.

00:41:31.780 | Eh, it was once again,

00:41:33.120 | the economists were predicting recessions

00:41:34.660 | and it was, eh, President Trump fixed it all, right?

00:41:37.860 | So at that point in time,

00:41:40.220 | you just go ahead and take the cash and pay off your debts.

00:41:42.860 | What was your cost?

00:41:44.220 | Well, your cost was 12 months worth of interest payments

00:41:46.540 | in that situation.

00:41:47.700 | That's why I say,

00:41:48.520 | as long as your debt is at reasonable interest rates.

00:41:50.220 | What is the actual cost of that?

00:41:52.100 | In most cases, not much.

00:41:53.540 | Most listen to the show, that wouldn't be all that much

00:41:55.640 | compared to the safety of having that 12 months of cash.

00:41:58.700 | So stockpile cash,

00:42:00.540 | stop paying extra on your debt and pile it up.

00:42:03.360 | You can always take the cash and pay off your debt,

00:42:06.480 | but you can't always easily borrow more money

00:42:09.180 | in the middle of a recession.

00:42:11.360 | Stockpile cash.

00:42:12.960 | Next, refinance now any debt

00:42:16.960 | that is not intelligently set up

00:42:19.080 | for long-term low-cost maintenance.

00:42:22.240 | This is the time to refinance.

00:42:24.240 | This is the time, back to that 50%.

00:42:27.840 | Let me give you a real problem.

00:42:29.000 | How would you solve this?

00:42:30.980 | Your household budget is currently $5,000 a month.

00:42:34.700 | Your monthly mortgage payment is $2,000 per month.

00:42:38.680 | And you have other expenses.

00:42:41.140 | You have utilities, you have food,

00:42:43.420 | just basic expenses of life.

00:42:44.940 | And so I say to you, how do you cut your budget by 50%?

00:42:47.580 | I give you $2,500 a month.

00:42:49.420 | So you go through and you say,

00:42:50.300 | well, I could drop my electrical expense by 30%.

00:42:54.460 | That would save me $37.

00:42:56.340 | We could lower our food expenses by $200 a month.

00:42:58.900 | And you go through all this math

00:42:59.980 | with all these little frugality things

00:43:01.380 | and you look at it and you say,

00:43:02.340 | but the reality is there's no way

00:43:05.420 | we could adjust our budget to go from $5,000 a month

00:43:07.980 | to $2,500 a month 'cause I got a $2,000 mortgage payment.

00:43:12.420 | You're right, you can't do it.

00:43:14.220 | It's not gonna be possible for you.

00:43:16.620 | But what you can do is refinance your mortgage.

00:43:19.900 | So if you have 12 years left on your mortgage

00:43:24.340 | and you're in a situation, you say,

00:43:25.980 | well, I got a $2,000 monthly mortgage payment.

00:43:28.460 | Now's not a bad time to refinance your mortgage.

00:43:31.380 | So refinance your mortgage to a 30-year payment.

00:43:34.580 | Drop your monthly payment from $2,000 to $1,100.

00:43:39.580 | But if you want, either stockpile the cash now,

00:43:42.160 | but stay focused and pay that thing off fast,

00:43:43.980 | but make a $2,000 monthly payment.

00:43:46.120 | What you've done in that situation

00:43:47.860 | is you've increased your safety

00:43:49.540 | because you've lowered your mortgage payment.

00:43:51.780 | So you lower your mortgage payment

00:43:54.740 | by extending the terms, that buys you more time.

00:43:57.900 | Now you can live on less money,

00:43:59.940 | but you can still pay the mortgage off fast.

00:44:02.420 | Now today, that's probably pretty easy for you to do

00:44:06.640 | because you are well-employed.

00:44:08.620 | But the day you lose your job

00:44:12.160 | and you call up a mortgage broker

00:44:14.060 | and say, I'd like to refinance my mortgage,

00:44:15.980 | and they say, what's your income?

00:44:17.500 | $0.

00:44:19.140 | That is a whole lot harder to do.

00:44:22.020 | It's tough to refinance a mortgage

00:44:23.500 | when you're unemployed and current.

00:44:26.180 | Yes, you can go behind on your mortgage,

00:44:27.980 | miss months of payments,

00:44:28.860 | and then they might work with you

00:44:30.260 | and rejigger the mortgage for you.

00:44:32.940 | But you don't wanna do that.

00:44:34.740 | So refinance your mortgage now.

00:44:36.760 | And that cash may be extremely valuable for you.

00:44:42.120 | In a moment, we'll talk about bankruptcy planning,

00:44:45.040 | just a second.

00:44:45.980 | But pulling that cash and that equity out,

00:44:48.160 | as long as you're not an idiot and spend it,

00:44:51.020 | can be very much within your best interest.

00:44:52.980 | Talk about that in a moment.

00:44:54.500 | Remember, you can always pay down a mortgage again

00:44:57.180 | as long as you have the cash and you haven't spent it.

00:44:59.740 | So set aside the cash and stockpile the cash,

00:45:03.920 | refinance the mortgage until you're in a position

00:45:06.100 | where you can just simply pay it off.

00:45:08.000 | If you can show a check and pay off the mortgage,

00:45:11.180 | that can be a great thing to do

00:45:12.380 | because now you have the house debt-free.

00:45:14.780 | And now you don't have any monthly payment coming out,

00:45:17.540 | which is very safe.

00:45:18.860 | But if you got 12 years of payments coming out

00:45:21.220 | and $2,000 a month that you owe,

00:45:23.580 | and you don't have a huge amount of savings,

00:45:25.260 | that could be a very precarious situation

00:45:27.460 | because you can't make a $2,000 a month

00:45:29.420 | mortgage payment driving for Uber.

00:45:31.500 | But you could make a $1,200 a month

00:45:33.060 | mortgage payment driving for Uber.

00:45:34.740 | So refinance any debt that isn't properly set up

00:45:39.520 | for easy, comfortable, long-term maintenance.

00:45:42.580 | This is the time also to refinance your credit card debts.

00:45:45.740 | It's much easier to do what I teach

00:45:47.720 | in my credit card course, to apply for higher,

00:45:50.860 | you can get easily approved for much higher credit limits

00:45:53.620 | when you can report income.

00:45:55.460 | But the day you lose your job

00:45:56.620 | and you have to fill out that application

00:45:57.980 | that says what's your annual income,

00:45:59.180 | and now you say, "Oh, well, it was $150,000,

00:46:04.180 | "and today it's zero."

00:46:06.100 | Whole lot easier to get more credit limit

00:46:07.700 | when you got $150,000 income

00:46:09.460 | that you can honestly, truthfully report than $0.

00:46:13.060 | So maybe you use the cash from your mortgage refi,

00:46:15.940 | take my credit card course, refi,

00:46:18.580 | take the cash, pay off your credit cards,

00:46:21.220 | raise your credit score, and then re-borrow the money

00:46:23.160 | at 0%, they're much more favorable terms,

00:46:25.740 | stack the excess capital up in a bank account,

00:46:28.420 | and have it available to you

00:46:29.380 | to pay off the credit cards again or pay off the mortgage.

00:46:31.780 | So take my credit card course,

00:46:33.760 | or at least listen to all the free shows

00:46:35.020 | I put out a year ago when I launched that course,

00:46:36.700 | and you'll get the idea of some ways to do it.

00:46:39.000 | So refinance any debt that isn't intelligently

00:46:41.420 | and comfortably set up for the long-term.

00:46:43.140 | Take a look at every bit of debt that you have.

00:46:45.540 | Next, protect your assets.

00:46:48.060 | This is the time to do pre-bankruptcy planning.

00:46:51.580 | Do it now.

00:46:52.640 | This is the time to do pre-bankruptcy planning.

00:46:55.400 | Most people who wind up in bankruptcy

00:46:58.740 | never expected to be there.

00:47:00.940 | Yes, some of them made foolish decisions

00:47:03.100 | where they said, "I'll have this great thing,"

00:47:04.780 | and they just didn't think.

00:47:06.360 | But many people wind up in bankruptcy

00:47:09.340 | through circumstances that they didn't anticipate.

00:47:11.900 | A recession came along

00:47:13.020 | right when they had a major health crisis,

00:47:14.860 | and now all of a sudden, they're deeply in debt,

00:47:17.020 | and they wind up in bankruptcy.

00:47:18.740 | This is the time to do pre-bankruptcy planning.

00:47:21.800 | So sit down, take all my shows that I did

00:47:24.380 | on credit or asset protection for,

00:47:26.560 | can't even remember,

00:47:28.860 | you know you have bad show titles

00:47:30.400 | when you can't even remember the names of your own shows.

00:47:33.300 | Asset protection for mere mortals.

00:47:36.140 | The whole series of show,

00:47:37.360 | I work back and forth with bankruptcy planning.

00:47:39.700 | Read a book on bankruptcy planning.

00:47:40.940 | You can do it yourself.

00:47:41.780 | Consult with a bankruptcy planning attorney,

00:47:43.660 | and do pre-bankruptcy planning when everything is good,

00:47:46.040 | when you're well-employed, et cetera.

00:47:47.900 | This is the time to think about what would happen

00:47:50.540 | if this recession forced me into bankruptcy.

00:47:53.040 | See, we get used to three-month recessions,

00:47:55.380 | six-month recessions, year-long recessions.

00:47:58.500 | What if the next recession is three years long?

00:48:01.660 | What if it's twice as bad as the one in 2008?

00:48:04.720 | What if that was the great recession,

00:48:06.460 | and now this is the greatest recession?

00:48:08.380 | Are you prepared?

00:48:10.640 | Do pre-bankruptcy planning now.

00:48:13.300 | So what do you do?

00:48:14.300 | Well, you re-finance, let's say in the mortgage example,

00:48:17.340 | you have 12 years left on your mortgage,

00:48:18.580 | $2,000 monthly payment,

00:48:19.700 | normal household income, $5,000 per month.

00:48:22.220 | Pretend you don't live in a state

00:48:24.780 | that protects 100% of your homestead.

00:48:26.980 | You don't live in Florida.

00:48:28.240 | You don't live in Texas.

00:48:29.200 | You don't live in Kansas.

00:48:30.540 | You live in Georgia or North Carolina,

00:48:32.820 | where they give you this measly little

00:48:34.220 | $15,000 homestead exemption.

00:48:36.460 | Well, what I say is in that situation,

00:48:39.980 | re-finance your mortgage.

00:48:42.540 | Re-finance it to strip the equity off the homestead,

00:48:45.660 | and make sure that this year you fully fund your 401(k),

00:48:48.900 | fully fund your IRA.

00:48:50.340 | If you're worried about market declines,

00:48:52.120 | just keep the money in a cash account inside your 401(k),

00:48:55.020 | inside your Roth IRAs, et cetera.

00:48:57.160 | But the money in your 401(k), your Roth IRA,

00:48:59.220 | depending on the bankruptcy laws of your state,

00:49:00.820 | should be protected in bankruptcy.

00:49:02.740 | And so it's a very safe place for you to keep it,

00:49:05.140 | whereas the money in your home is not protected.

00:49:08.420 | Now, if you live in Florida, Texas, Kansas, et cetera,

00:49:10.860 | some of the states that are generous

00:49:11.880 | with homestead exemptions,

00:49:13.180 | then that advice is different.

00:49:14.960 | But you still maximize your 401(k),

00:49:17.220 | and in that situation, make sure that you maximize

00:49:19.280 | the amount of equity in your house,

00:49:20.420 | because now that's protected.

00:49:21.460 | So do the pre-bankruptcy planning in your state now.

00:49:24.620 | Fund your 529 plans, fund your health savings accounts

00:49:27.620 | if they're protected in your states.

00:49:29.900 | Let's say your state gives you

00:49:31.500 | bankruptcy protection on one car.

00:49:33.940 | Well, pay off the one car that you'd keep

00:49:35.780 | that comes in within the appropriate values

00:49:37.920 | for your state's bankruptcy laws,

00:49:39.980 | and then just pay minimums on the second.

00:49:42.480 | Take some of the cash from a non-bankruptcy-protected

00:49:45.600 | account and stock the pantry full of canned goods

00:49:48.640 | and long-lasting food that would see your family fed

00:49:51.900 | in difficult times.

00:49:53.320 | Pay minimum payments on the credit cards,

00:49:55.120 | but maximize your 401(k) and IRA contributions.

00:49:58.600 | This is the time to do bankruptcy planning

00:50:00.400 | when you're long away from it,

00:50:01.820 | when you don't think it could ever happen.

00:50:03.740 | Now, what's the worst that could happen?

00:50:06.520 | Well, worst that could happen is, of course,

00:50:08.960 | that three years you're into a recession,

00:50:11.260 | you've been unemployed for two years,

00:50:12.520 | and you wind up in bankruptcy court.

00:50:14.180 | Well, you're gonna be happy with the advice

00:50:15.740 | that I've just given you.

00:50:17.160 | But in a better situation,

00:50:19.120 | yeah, you don't even lose your job.

00:50:21.080 | What do you do?

00:50:21.920 | You don't lose your job, you continue stockpiling cash,

00:50:24.680 | you're out and already you have enough money

00:50:26.400 | to comfortably pay off the house,

00:50:28.160 | you refinance, you just keep things going.

00:50:30.600 | And when the recession indicators lift,

00:50:32.220 | your career seems very stable,

00:50:34.180 | you've got plenty of money, plenty of savings,

00:50:36.320 | just simply pay it off.

00:50:37.320 | You paid a few thousand dollars of mortgage interest,

00:50:41.320 | hopefully paid relatively almost close to zero

00:50:43.520 | on your credit cards, car payment, whatever.

00:50:46.560 | Protect yourself.

00:50:47.760 | I'm not advocating for you to borrow money.

00:50:50.300 | I'm not advocating for you to go into debt.

00:50:52.120 | I'm advocating for you, if you're in debt,

00:50:54.280 | to be intelligent and understand the law.

00:50:56.800 | This is the time, when you're not anywhere near bankruptcy,

00:51:00.040 | to do pre-bankruptcy planning

00:51:01.720 | in the preparation for the unfortunate circumstance

00:51:05.640 | of three years from now, you wind up in bankruptcy court.

00:51:08.160 | You don't wanna be there

00:51:09.080 | and not have maximized your opportunities.

00:51:11.180 | Now, the other reason for you

00:51:14.520 | to be doing what I'm encouraging you,

00:51:16.680 | stockpile cash, refinance debt, et cetera,

00:51:19.920 | is to prepare for opportunities.

00:51:23.520 | If you see recession coming,

00:51:25.880 | yes, you want to be defensive, correct,

00:51:29.420 | but you also wanna be prepared

00:51:32.240 | to take advantage of opportunities.

00:51:34.920 | So as the recession nears, as you see signs,

00:51:37.880 | start cutting expenses and stockpiling cash

00:51:40.560 | to free up money for either making good use

00:51:43.640 | of the recession for your personal benefit

00:51:45.840 | or to free up money for your investment.

00:51:48.200 | Let's talk about personal benefit before investment.

00:51:50.320 | Think now about how you would creatively use the recession

00:51:55.000 | for your personal benefit,

00:51:58.200 | to advance you in the direction that you desire to go.

00:52:01.800 | I'll give you an example.

00:52:02.800 | Pretend that I'm working a job.

00:52:05.280 | It's good, it provides for me,

00:52:07.520 | but it's not necessarily what's been on my dream list,

00:52:10.280 | but it has seemed irresponsible for me to quit my job

00:52:13.100 | at this point in time.

00:52:14.800 | But I've always had a dream

00:52:16.340 | of starting a publishing business.

00:52:19.240 | I've always had a dream of starting a media business

00:52:21.680 | or something online, et cetera.

00:52:23.320 | And I'm using that just to give an extreme example here.

00:52:25.480 | Maybe I've always had a dream

00:52:26.600 | of starting a carpentry business

00:52:27.800 | or opening a restaurant or a coffee shop

00:52:29.440 | or a plumbing business, whatever your thing is.

00:52:32.300 | I'm just using an extreme example for fun.

00:52:35.040 | So it's never seemed intelligent for me to quit my job,

00:52:40.040 | but I recognize that I don't necessarily

00:52:42.240 | wanna do this forever.

00:52:43.840 | But I've got a mortgage, I've got a car payment,

00:52:47.300 | I've got some credit card debt,

00:52:48.760 | and my kids are in private school,

00:52:49.920 | and that's important to me.

00:52:51.800 | So now I go in, boss says, "Sorry, buddy,

00:52:54.120 | today's your last day."

00:52:55.120 | I lose my job.

00:52:56.160 | And my industry is in turmoil,

00:52:57.800 | employment's down or unemployment's up,

00:53:00.600 | sales are down.

00:53:01.520 | And I just think, you know what?

00:53:02.840 | I'm probably not gonna get another job in my industry.

00:53:05.680 | So what would I do in that situation?

00:53:07.640 | Well, conveniently, of course,

00:53:09.640 | I've tailored my example to fit my radical personality,

00:53:11.760 | but here's what I would do.

00:53:13.000 | I would immediately pack up my stuff

00:53:14.860 | and I would rent out my house.

00:53:16.940 | I would sell all my cars

00:53:18.640 | to pay off as much of the car payments as I possibly could.

00:53:21.760 | I would pull my children out of private school

00:53:24.320 | and I would use the money from the sale of the cars

00:53:25.940 | or my savings or whatever,

00:53:27.120 | and I'd fly my family to Thailand.

00:53:29.680 | I'd rent an apartment in Chiang Mai, Thailand.

00:53:32.200 | I'd homeschool my children,

00:53:33.880 | and I would work day and night

00:53:35.280 | to start my publishing business.

00:53:37.800 | Because with that move,

00:53:38.940 | I've probably just adjusted my budget,

00:53:40.880 | my household monthly budget,

00:53:42.040 | from $5,000 a month

00:53:43.680 | to being able to live on $1,000 a month,

00:53:46.320 | including a perfectly nice place,

00:53:48.720 | beautiful beach, lots of food,

00:53:50.480 | just because of the change of the costs of living.

00:53:53.800 | Now, in that situation, how do I do it?

00:53:57.200 | Well, remember, most people,

00:53:58.640 | we're talking about normal situations,

00:54:00.440 | most normal houses can be rented out at high enough rates

00:54:04.480 | to cover the mortgage payment with some extra.

00:54:06.740 | Maybe you had that house

00:54:09.360 | where your monthly mortgage payment was $2,000 a month,

00:54:12.560 | but by refinancing now,

00:54:14.200 | you've dropped your monthly mortgage payment to $1,200 a month

00:54:17.400 | and you've freed up several tens of thousands of dollars

00:54:19.520 | of extra cash, which you've then gone ahead

00:54:21.120 | and stuffed into your 401(k) and your Roth IRA

00:54:23.320 | to do good bankruptcy planning in place

00:54:25.040 | and have some protection,

00:54:26.160 | and you keep a bunch of extra money

00:54:27.200 | in your checking account as well.

00:54:29.000 | I'm not saying don't have money in your checking account,

00:54:30.960 | but now your mortgage payment is $1,200.

00:54:33.680 | Well, most houses in that range

00:54:35.960 | could probably be rented out for 1,800 to $2,200 a month

00:54:39.680 | across the, at fair market rents across the country,

00:54:42.080 | sometimes higher, but very comfortably.

00:54:45.040 | So you rent out your house for $2,000 a month

00:54:47.040 | and you got a $1,200 mortgage payment.

00:54:49.480 | Selling the car, so that creates $800 of income

00:54:54.700 | that I didn't have previously.

00:54:57.260 | Because I had to pay that mortgage payment of $1,200,

00:54:59.660 | but now I rent the house out,

00:55:01.300 | I've got 800 extra dollars of income.

00:55:04.100 | Selling the cars clears out a massive monthly outflow.

00:55:07.140 | Maybe I had two car payments at $400 a piece.

00:55:09.460 | Oh, I sell both of them.

00:55:10.580 | Now I've dropped my expenses by $800.

00:55:13.540 | I've also possibly freed up some equity

00:55:15.800 | that was locked in that car that can be put to better use.

00:55:19.380 | By moving to a place where I don't need a car,

00:55:22.180 | I can easily bum around on a scooter

00:55:24.060 | or hitch a ride on the rickshaw and pay a taxi.

00:55:26.580 | It's very affordable, take Uber, whatever.

00:55:29.260 | But I've freed up, I don't even need a car.

00:55:30.980 | So I don't have to solve that problem anymore.

00:55:33.540 | So I've lowered my expenses,

00:55:35.500 | both now by clearing the car payments,

00:55:38.820 | and I've moved to a place where I don't need the car.

00:55:41.900 | Now, I surf my credit cards around

00:55:44.000 | with small minimum payments, keep all that at 0%.

00:55:46.420 | Just keep that stable, but keep those payments current.

00:55:49.500 | And now with my big move to Thailand,

00:55:51.740 | I've lowered my cost of living from $5,000 a month

00:55:55.100 | to $1,000 a month, because of moving

00:55:57.420 | from a high cost of living place

00:55:58.760 | to a low cost of living place.

00:56:00.300 | My rent, instead of paying $1,200 a month

00:56:04.740 | on a mortgage payment, my rent is $400 a month

00:56:07.420 | for a two bedroom, three bedroom on the beach.

00:56:10.460 | My food expenses dropped massively.

00:56:12.820 | I can eat out my whole family for $300 a month.

00:56:16.220 | We've probably potentially dropped other expenses.

00:56:18.380 | Maybe you don't need health insurance

00:56:19.700 | because you're in a place where the cost of doctor bills,

00:56:23.540 | et cetera, is not nearly so catastrophic

00:56:25.580 | as the United States.

00:56:27.140 | So I can drop my health insurance.

00:56:28.420 | That saves me $900 a month

00:56:30.260 | that I would be paying with COBRA.

00:56:31.960 | There'll also be a massive change in my taxes.

00:56:35.980 | Pretend I've got two or three children.

00:56:39.020 | Well, if my income goes from,

00:56:40.620 | say it was $120,000 per year before, and now it's zero,

00:56:44.960 | all of a sudden this year,

00:56:47.980 | instead of paying $30,000 of income taxes,

00:56:51.340 | I'm gonna get some nice big fat child tax credits

00:56:54.620 | and earned income tax credits back on my tax returns.

00:56:59.540 | And yet I can still live on this lower amount.

00:57:02.540 | I've got $800 a month of cash flow

00:57:05.520 | from renting out my house.

00:57:07.380 | And now with extra savings, freeing up some cash,

00:57:12.380 | I just need another couple $300 a month

00:57:14.620 | for a couple $300 a month from my

00:57:19.100 | (smacks lips)

00:57:22.100 | savings, just pulling from my savings to cover me.

00:57:24.780 | So then I pour myself into the business,

00:57:26.500 | get the business really building successfully.

00:57:28.740 | It takes me two years.

00:57:29.780 | I bring it back to three, $4,000.

00:57:32.060 | We call up our tenants,

00:57:32.900 | say you're out at the end of this year,

00:57:34.340 | and we fly back from Thailand.

00:57:35.380 | The biggest added expense of that is plane tickets.

00:57:38.720 | And in my example, you had to want to move to Thailand.

00:57:42.100 | Now, I've used an extreme example

00:57:45.860 | just to show you what can happen

00:57:48.220 | if you think ahead about this.

00:57:50.820 | Some of you would hear that example and say,

00:57:53.700 | why didn't I think of that?

00:57:54.980 | That's exactly what I'm gonna do.

00:57:56.500 | And some of you are looking at that and saying,

00:57:58.260 | I've always wanted to start an online publishing business,

00:58:00.300 | and now you've just showed me how I can do it.

00:58:01.700 | I chose Chiang Mai because there's a bunch of,

00:58:04.340 | it's kind of an internet entrepreneur hotspot

00:58:06.940 | in today's world.

00:58:08.420 | But some of you listen to that and say,

00:58:10.380 | I'd never moved to Thailand.

00:58:11.900 | But think about what you would do.

00:58:13.260 | That can be done locally.

00:58:15.820 | That kind of movement can be done locally.

00:58:19.060 | And so now you can have the opportunity

00:58:21.820 | to use a recession and a job layoff.

00:58:23.980 | That's what I was forgetting.

00:58:24.820 | You got severance pay.

00:58:27.020 | So I've just taken your months of severance pay,

00:58:30.340 | and I've stretched it out where previously

00:58:33.740 | you're gonna get $4,000 a month of severance pay

00:58:36.060 | for six months.

00:58:37.140 | Well, that $24,000 was only barely gonna keep you

00:58:40.580 | in your house for six months.

00:58:42.180 | Whereas now that $24,000 mixed with the cost

00:58:46.060 | of renting your income out gives you,

00:58:47.500 | even after plane tickets to Thailand,

00:58:49.220 | $4,000 to plane tickets,

00:58:50.900 | that still now gives you two years of runway

00:58:53.180 | where you don't have to make a dime in your new business

00:58:55.300 | for the next two years.

00:58:56.940 | And so you invest in your business,

00:58:59.540 | take those business expenses, keep your taxes really low,

00:59:02.260 | maximize your refundable tax credits in the United States,

00:59:05.020 | and now I've freed up extra money

00:59:06.580 | and we've got three years of runway.

00:59:08.460 | And you can build the business,

00:59:09.460 | keep it very, very profitable,

00:59:13.060 | enjoy hanging out on a Thai beach,

00:59:15.820 | taking your kids all over on scooter tours of Thailand,

00:59:18.220 | enjoy learning Thai, it's a wonderful place.

00:59:20.460 | So, but it can also be done locally.

00:59:24.740 | You don't have to go to Thailand.

00:59:26.420 | I've done this, I've taught people how to do this

00:59:29.660 | in the United States.

00:59:30.820 | I had a consulting client one time,

00:59:32.580 | got laid off from a very high level job.

00:59:34.980 | Their entire life and their entire lifestyle and structure

00:59:38.500 | was built around this high paying, high status job

00:59:42.580 | in a major metropolitan city.

00:59:45.300 | Well, they got laid off

00:59:46.700 | and they got an extremely generous severance package,

00:59:49.340 | but that severance package wouldn't have gone all that far

00:59:52.060 | in that high paying metropolitan city.

00:59:55.020 | Convince them to get rid of their stuff, buy an RV,

00:59:58.620 | they'd always wanted to write a book,

00:59:59.660 | convince them to write a book and to adjust.

01:00:02.460 | And now that one year of severance

01:00:04.020 | turned into three years of runway to make this life change.

01:00:07.940 | And you can always get another job.

01:00:09.340 | You can always get another high paying job

01:00:10.780 | and move back into the high status lifestyle,

01:00:12.700 | but you can use a recession as an opportunity in your life.

01:00:17.300 | You can use severance pay as an opportunity

01:00:19.540 | to start the new business, buy the subway franchise,

01:00:22.260 | do, you know, build the, write the book,

01:00:25.180 | become a public speaker, become a circus performer,

01:00:28.100 | what, become a meditation guru, I don't know.

01:00:31.380 | You can do it, you can do it locally.

01:00:32.820 | You don't have to go to Thailand.

01:00:33.740 | You can do it right in the United States.

01:00:35.260 | You can do it right in downtown Chicago.

01:00:37.780 | Next, if there's a recession,

01:00:40.900 | think about what deals you may be able to get

01:00:44.220 | that would fit your personal desired goals.

01:00:46.900 | Always wanted to buy an RV, too expensive.

01:00:51.300 | People start selling RVs in recessions

01:00:54.300 | because they got to dump their monthly payment.

01:00:57.100 | You step in, take over their loan even,

01:00:59.520 | but solve their problem for them,

01:01:02.300 | take their RV off their hands,

01:01:03.740 | you've solved their problem, get yourself a nice deal.

01:01:06.500 | Always wanted to buy a boat.

01:01:08.060 | You can get some really nice deals

01:01:09.940 | a couple of years into a recession.

01:01:11.980 | Always wanted to go on a cruise.

01:01:13.980 | Well, the time to do it is a couple of years

01:01:15.580 | into a recession.

01:01:16.940 | Do your buying when people are hurting

01:01:20.580 | so that you can get your deals.

01:01:22.380 | Do your selling when people are doing well.

01:01:25.220 | So plan ahead and free up the cash

01:01:28.580 | so that you're in a position

01:01:29.940 | to take advantage of the recession.

01:01:31.980 | And then finally, this is the time for you

01:01:35.340 | to prepare for investment opportunity.

01:01:38.900 | Recessions, depressions, generally create

01:01:42.180 | buying opportunities for those who are prepared,

01:01:45.180 | for those who have an idea, for those who have money,

01:01:48.980 | for those who have a plan,

01:01:50.420 | and for those who have the clarity of purpose to move.

01:01:54.400 | Now, that might be buying stocks.

01:01:56.900 | You wanna be, maybe you do this in your 401k.

01:01:59.620 | You pull your money out and you're sitting there waiting.

01:02:02.060 | And that day when all your fellow coworkers,

01:02:05.020 | you hear just the listening over the wall of the cubicle,

01:02:07.700 | man, I sold, I got out.

01:02:09.780 | That's the day you click buy and you move back in.

01:02:12.840 | So maybe it's buying stocks.

01:02:14.520 | There are throughout history, many investors

01:02:17.020 | who made their mark buying stocks

01:02:20.460 | when everything was bad.

01:02:21.540 | My favorite is John Templeton.

01:02:22.900 | He started in the midst of the Great Depression

01:02:25.900 | buying companies that were considered worthless.

01:02:29.460 | So maybe it's stocks.

01:02:30.940 | Maybe it's real estate.

01:02:32.820 | You can come in during,

01:02:34.380 | usually real estate seems to decline

01:02:36.220 | a couple of years after a recession starts.

01:02:38.220 | People start, they lose their jobs

01:02:39.620 | and there's an ongoing cycle.

01:02:40.620 | People lose their jobs and they start getting behind

01:02:42.540 | on their mortgage payments.

01:02:43.380 | Then they move in foreclosure.

01:02:44.900 | And now you may be able to come in,

01:02:46.580 | take over the mortgage, negotiate short sales,

01:02:49.580 | negotiate purchases, a whole long world into that.

01:02:53.820 | But it's a really great time to get started

01:02:55.540 | building your investment portfolio

01:02:57.780 | when you come in in the middle of a recession.

01:03:00.580 | The trick is you either gotta have cash

01:03:02.060 | or have access to cash.

01:03:03.700 | So that's the time to do it.

01:03:05.140 | Maybe it's starting and buying a new business

01:03:09.060 | or expanding one.

01:03:10.700 | You can get great deals on rents

01:03:13.740 | because in the middle of the recession,

01:03:15.020 | landlord was renting out this storefront space

01:03:17.380 | for $2,500 a month, but he drops to $1,500 a month

01:03:21.160 | because he cannot stand to have his strip mall vacant.

01:03:23.420 | That just makes everything go down.

01:03:25.020 | So you come in and you get a very significant discount

01:03:27.680 | on renting his space, or you start a business on the side

01:03:31.900 | and all the new tools of your business are super cheap

01:03:34.500 | because the competitors are going into bankruptcy.

01:03:37.300 | Whatever your investment opportunities are,

01:03:39.020 | whatever your investment plans are,

01:03:40.660 | plan ahead and try to be prepared

01:03:42.340 | to take advantage of them in a recession.

01:03:44.340 | I close out with this.

01:03:47.240 | I don't think that you should wait on a recession

01:03:52.860 | in order to pursue your plans.

01:03:54.980 | If you're ready to go now to invest in real estate

01:03:57.260 | and you find a deal that fits your parameters, buy.

01:04:00.640 | If you're ready to start a business

01:04:01.780 | and you're ready to make that transition now, go.

01:04:04.340 | Make the transition.

01:04:06.300 | But if it just so happens that the recession aligns

01:04:12.000 | with your personal movements,

01:04:14.140 | and if it just so happens that you're ready

01:04:16.320 | to buy real estate and then a recession comes along,

01:04:20.320 | make it happen.

01:04:22.220 | This is the time.

01:04:24.740 | Don't miss the opportunity.

01:04:26.540 | What does Rahm Emanuel say?

01:04:28.260 | Never let a good crisis go to waste.

01:04:30.820 | Never let a good crisis go to waste.

01:04:33.420 | This is your chance.

01:04:34.520 | I am concerned, significantly concerned,

01:04:40.420 | about the potential for recession in the United States

01:04:45.180 | in the coming months and years.

01:04:47.260 | It will be fascinating to see how it works out.

01:04:49.620 | If the recession arrives soon,

01:04:52.900 | it's arriving much later than I thought it would.

01:04:55.820 | So I was wrong on my previous predictions.

01:04:59.980 | I thought we'd be in recession in 2017.

01:05:03.260 | I thought we'd be in recession in 2018.

01:05:06.740 | Here we are in 2019, we haven't been in recession.

01:05:09.740 | But just because I was wrong in my personal guesses

01:05:16.020 | doesn't mean that I was hurt by preparing for recession.

01:05:20.200 | I'm convinced this is the secret to good planning,

01:05:24.100 | is be positioned as best you can for different things.

01:05:27.900 | Now you can't be positioned for all markets

01:05:32.900 | and all opportunities and be optimized

01:05:34.660 | for every one of those.

01:05:36.300 | If you are stockpiling cash, preparing for a recession,

01:05:39.140 | and you're not paying off debt,

01:05:40.300 | yes, you are paying more interest.

01:05:43.220 | You are using up time, perhaps.

01:05:45.760 | But that cost is probably pretty low

01:05:48.940 | compared to the opportunities.

01:05:51.060 | So I'm convinced that there's a very decent chance

01:05:54.940 | that recession is coming soon,

01:05:56.060 | which is why I'm trying to seek to prepare you.

01:05:58.420 | But I haven't sat around and waited on,

01:06:02.980 | I haven't sat around and waited on recession

01:06:04.780 | to move forward, and I don't think you should either.

01:06:07.620 | If you think back to the recommendations I've made,

01:06:10.460 | what you'll see is that, ironically,

01:06:13.020 | many of these things apply just as much

01:06:14.820 | in boom times as in bust times.

01:06:17.500 | I'm just trying to leverage the news and the concern,

01:06:21.100 | et cetera, to try to get your attention

01:06:22.700 | to break through with some plans.

01:06:24.540 | I do think it's worth it to prepare for recession,

01:06:27.080 | but the time to prepare for recession

01:06:28.300 | is when things are going well.

01:06:30.220 | If you're gonna be a contrarian,

01:06:33.400 | then you've gotta think differently.

01:06:37.620 | So you prepare for recession when everything is going well.

01:06:40.740 | And then when everybody else is freaking out,

01:06:45.940 | that's the time that you're Mr. Optimist,

01:06:49.060 | going all in on your plans for optimism.

01:06:51.060 | And if you can cultivate the psychology

01:06:55.220 | and then buttress that psychology

01:06:56.820 | with some good, useful, technical planning ideas,

01:06:59.500 | et cetera, like hopefully I've given you a handful today,

01:07:02.300 | then I think you're positioned well for success.

01:07:05.440 | I am grateful that you are here.

01:07:09.280 | I would strongly encourage you,

01:07:12.400 | if your personal finances are not robust

01:07:15.980 | and prepared for recession, you have time.

01:07:19.960 | If you are not well-employed right now,

01:07:22.760 | I don't know what you're waiting on.

01:07:24.440 | Unemployment at record low levels, this is the time.

01:07:28.060 | So get busy.

01:07:29.960 | If you've got three months or six months

01:07:33.320 | of preparation time or a year, whatever, whatever,

01:07:38.280 | I don't know, I'm trying to stay away from prognostications.

01:07:42.280 | If you've got three months, six months, or a year,

01:07:43.960 | and you use that effectively,

01:07:45.780 | then you'll be positioned to win in the next recession.

01:07:49.280 | That's what I want for you.

01:07:52.320 | So think carefully.

01:07:53.840 | If you've got additional suggestions, contributions,

01:07:57.160 | then go ahead and share those with me here.

01:08:00.360 | As I close, I would just really encourage you,

01:08:04.760 | I have two courses currently on the market.

01:08:07.040 | I've pulled my career and income planning course

01:08:08.760 | off the market because it conflicts

01:08:10.520 | with something else that I'm doing.

01:08:11.880 | But I have two courses available on the market.

01:08:13.920 | Both of these courses are ideally suited

01:08:15.960 | for preparing for recession.

01:08:18.160 | If you have not taken my courses, I ask you to do it.

01:08:22.600 | It is worth your money and worth your time

01:08:24.880 | to take my courses.

01:08:26.360 | I offer an unconditional money-back guarantee

01:08:28.240 | if you don't think it was worth your time

01:08:29.640 | and worth your money.

01:08:30.680 | I have had almost no returns or requests for a refund

01:08:35.520 | on those two courses out of many, many students.

01:08:40.320 | They are good.

01:08:41.640 | If you liked any of the ideas in this show,

01:08:44.280 | you will like the ideas in those courses.

01:08:46.840 | The first one that I'm offering right now

01:08:48.360 | is called "How to Borrow Money Safely

01:08:51.000 | and Never Pay Interest Using Credit Cards."

01:08:53.360 | Most people use credit cards wrong.

01:08:56.280 | And they use credit cards as an emergency mechanism

01:08:59.600 | instead of properly understanding the system

01:09:02.320 | so that they can exploit it to their benefit.

01:09:04.920 | Credit cards can be a wonderful tool for you

01:09:08.360 | if you know what you're doing

01:09:09.880 | and if you can exercise proper self-control

01:09:12.560 | so that you don't wind up spending money on consumption.

01:09:15.920 | But if you have a credit card today

01:09:18.040 | or you think you might ever have a credit card

01:09:19.840 | in the future, I would ask you

01:09:22.380 | to please consider taking my course.

01:09:24.760 | I can potentially save you thousands and thousands

01:09:27.640 | and thousands of dollars on interest payments

01:09:31.100 | if you actually understand how to do the market,

01:09:33.280 | how the market works.

01:09:34.200 | Give you a very simple example.

01:09:36.360 | I did this recently with a consulting client.

01:09:37.960 | I have a consulting client, runs a very large business

01:09:40.760 | and uses credit cards in his business

01:09:44.720 | and generally has a six-figure balance month to month

01:09:48.000 | but pays it off month to month.

01:09:49.720 | But he was annoyed, has a perfect payment history,

01:09:53.960 | uses six figures of credit every single month,

01:09:57.280 | but he's got a credit score, I forget the exact number,

01:10:00.160 | but it was,

01:10:01.000 | it was 686.

01:10:05.280 | He had a 686 credit score, FICO score.

01:10:07.720 | It was frustrating.

01:10:10.720 | Why do I have a 686 FICO score

01:10:12.640 | when I have a perfect credit history,

01:10:14.000 | great mix of credit, long, never missed a payment, et cetera.

01:10:16.160 | Why do I have a 686 FICO score?

01:10:18.520 | Well, it's because he's got a six-figure balance

01:10:20.800 | on a monthly basis with all the money that's going through.

01:10:23.520 | Now, he has one simple practice.

01:10:25.680 | He uses a credit card and then on the day

01:10:28.240 | that the credit card payment comes in,

01:10:30.560 | he strokes a check and pays it off.

01:10:32.120 | Sorry, the day the bill comes in,

01:10:33.440 | he strokes a check and pays it off.

01:10:35.440 | So he pays off his credit card balance every single month.

01:10:38.720 | But here's the trick that most people don't recognize.

01:10:41.880 | The balance that's reported to the credit reporting agencies,

01:10:46.280 | which is the data that's used to make your credit score,

01:10:49.360 | is the balance that you have on the date,

01:10:51.960 | the closing date of your statement.

01:10:54.280 | So if you've got $100,000 balance on your credit cards

01:10:58.720 | and that balance is,

01:11:01.760 | and then they close the statement,

01:11:03.880 | then they send you your bill and then you pay it,

01:11:06.080 | you're reported as having $100,000 balance

01:11:08.520 | to the credit agencies.

01:11:10.440 | I made one simple suggestion.

01:11:12.640 | I said, very simply,

01:11:13.480 | this month, write your $100,000 check

01:11:16.440 | on the day before the statement closes.

01:11:18.400 | So he did it.

01:11:20.100 | The day before the statement closed,

01:11:20.960 | instead of a week later,

01:11:22.160 | he just wrote the $100,000 check,

01:11:24.400 | paid off the balance,

01:11:25.640 | and thus the balance that was reported

01:11:27.400 | to the credit agency was zero.

01:11:31.380 | That month, after that was filtered through

01:11:33.340 | to the credit reporting agencies,

01:11:34.640 | his FICO score was 788.

01:11:37.720 | He had over a hundred point increase in his FICO score

01:11:40.560 | from one little silly detail,

01:11:43.500 | one silly thing.

01:11:45.880 | And that helped him immeasurably

01:11:48.000 | to do some other refinancing that he was working on,

01:11:50.880 | because being able to simply show a 788 FICO score

01:11:55.080 | makes a huge difference rather than a 686.

01:11:59.640 | There was no factoring of interest.

01:12:02.360 | There was no, he wasn't paying interest.

01:12:03.740 | He was paying it off before interest was due.

01:12:05.680 | There was no factoring of being in debt.

01:12:07.340 | He wasn't in debt.

01:12:08.380 | He was simply using the credit cards in his business.

01:12:12.420 | But the weeks different of the date of writing a check

01:12:15.060 | made a hundred point increase in his FICO score.

01:12:18.420 | Now, that's just the tip of the iceberg

01:12:20.020 | of what's available with credit cards.

01:12:21.740 | But the key time that you establish

01:12:24.620 | a credit card infrastructure that helps you

01:12:26.900 | is when you don't need it.

01:12:29.180 | When you don't need it at all.

01:12:31.060 | When you're well-employed,

01:12:32.460 | when there's no recession, et cetera.

01:12:34.500 | But the time that that helps you

01:12:36.400 | is when you lose your job, when there's a recession,

01:12:38.660 | when you're trying to take advantage of opportunity,

01:12:40.460 | et cetera.

01:12:41.780 | So consider taking my course,

01:12:44.820 | How to Borrow Money Safely

01:12:45.880 | and Never Pay Interest Using Credit Cards.

01:12:48.100 | If you've already taken that course,

01:12:49.460 | I think I'm selling, I can't remember,

01:12:50.540 | 40 bucks, 50 bucks, it's cheap.

01:12:52.420 | And I offer you unconditional money back refund.

01:12:55.060 | If you've already taken that course,

01:12:56.620 | take my course, How to Survive and Thrive

01:12:58.520 | During the Coming Economic Crisis.

01:13:01.180 | Because everything in that course

01:13:03.660 | is applicable to surviving and thriving during a recession.

01:13:08.660 | Surviving and thriving during a personal job layoff.

01:13:11.860 | Now, I talk about some hardcore scenarios.

01:13:13.940 | If you wanna be prepared for the next Great Depression,

01:13:16.900 | how to survive and thrive

01:13:17.780 | during the coming economic crisis.

01:13:19.060 | That'll talk you through it.

01:13:20.520 | If you wanna be prepared for the hyperinflation

01:13:22.940 | of the US dollar, I'll walk you through it.

01:13:25.620 | That's in that course.

01:13:26.680 | I'm not shying away from the tough stuff.

01:13:28.940 | But the techniques and tactics

01:13:31.820 | to prepare for losing your job in a recession

01:13:34.980 | are ironically very similar to the techniques and tactics

01:13:38.840 | for preparing for hyperinflation of the US dollar.

01:13:42.380 | So if you haven't taken that course,

01:13:45.340 | I ask you to do it,

01:13:46.640 | How to Survive and Thrive During the Coming Economic Crisis.

01:13:49.140 | You can find both of those courses

01:13:50.340 | at radicalpersonalfinance.com/store.

01:13:53.100 | radicalpersonalfinance.com/store.

01:13:54.900 | Just go to radicalpersonalfinance.com

01:13:56.140 | and click on store.

01:13:58.340 | Got a lot coming in the coming weeks.

01:14:00.020 | I will be releasing the next three shows will be replays.

01:14:03.180 | If you have not heard them, listen to them.

01:14:04.820 | If you have heard them and didn't do what I said,

01:14:08.020 | consider listening to them and taking action.

01:14:10.180 | Because just listening to these next three shows

01:14:12.340 | two years ago or three years ago, that won't prepare you.

01:14:15.580 | But taking some of the actions will.

01:14:18.100 | Thank you for listening to my show,

01:14:19.100 | radicalpersonalfinance.com/store

01:14:20.740 | and I'll be back with you very soon.

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RPF0666-How_to_Prepare_for_the_Coming_Recession