Stocking up on Groceries

I used to watch this show on tv called Doomsday Preppers.

There was one episode about a woman that stocked her whole house up with food.

While most people would think that to be a crazy idea, I thought it was pure genius.

Canned food lasts for a few years, and she pickled all her produce.

In the case that the nuclear winter does not happen, that woman would never have to pay money for groceries again.

I'm not saying you should cram as much food into your house as possible, but it would be a good idea to keep extra food in your house in case of emergencies.

Maybe there is a storm and the power gets knocked out for a few days. Maybe floods and snow will prevent travel by car.

And storing extra food isn't a bad idea. Inflation is hitting groceries. Why not stock up on extra beans and chili before the prices rise next week.

I've heard from the black brigade podcast that it is good to store up 3 months of food in your house.

Something you should never do with life insurance

Earlier this month, I wrote a post about investing in life insurance if you have a family.

http://strategicalliving.blogspot.com/2014/05/how-to-create-legacy-make-your-children.html

If you have a family, life insurance is a good idea. However, I thought about different possibilities available with life insurance.

One idea that I had was to purchase a life insurance policy on my parents and pay the premiums myself until their passing and collect the death benefit.

This is a very terrible idea, I would not recommend people to do this.
Most people would jump to ethical reasons why not to do this, but there are two much more important reasons.

1. It's probably not legal. I don't know this for sure, consult with a lawyer if you want to.

The much more important reason is that

2. It's most likely not worth it.

If you think of this idea, it is fair to assume that you are in your 20's, 30's, or 40's and your parents do not have any sort of life insurance. Your parents may be in their 40's, 50's, and 60's.

Insurance companies aren't stupid, they hire actuaries to assess risks. They have to make money.

If you decide to buy a policy for your father, it is very likely that the premiums paid over the remainder of his life will outweigh the amount of the death benefit. If you do come out ahead, the return may be reduced to the point that your investment would have been better placed somewhere else.

A few months ago, my father proposed the idea to me. I had to point out why this was a bad idea.

The only way I can see this strategy would benefit someone is if their parents really did die in an accident within maybe 10 to 20 years. In that case, the death benefit would most likely outweigh the cost of your premiums.

Since doing this is similar to betting on forces that you cannot control, I would never recommend doing this.

Nickels are a hedge against inflation

This is an interesting one.

According to www.coinflation.com, the metal that composes a nickel (75% copper and 25% nickel) its worth slightly more than five cents (face value).

As inflation gets worse, I can only imagine that the price of copper and nickel will increase.

Not too long ago, I remember some story about some guy that bought 20 tons of nickels.

Keep in mind, it is illegal to melt down legal tender. However, if it becomes too expensive for the government to make nickels out of the current composition, they may start to make nickels out of something cheaper like zinc.

Most coins used to be made out of silver. In fact, pennies used to be mostly made out of copper until 1982. Today, pennies are made out of mostly zinc.

Speaking of which, each penny (1982 or before) is worth 2 cents (as of 5/12/14).

As these pennies get phased out of circulation, its possible they may gain some sort of numismatic value.

So, if you can't afford gold or silver, stock up on these nickels and pre 1982 pennies.
Don't coinstar them.

Building a CD ladder

A CD ladder is the concept of purchasing several certificates of deposit at different points in time.

In the past, people would purchases CD's at different times so they could wait around for a while to get the best interest rate possible.

When the CD matures, you can renew it if you like the interest rate.

This is a strategy for people who want a very safe way to invest money (won't lose principle).

I started this process back in 2011 but this was before my first job was terminated and before interest rates for most banks plunged.

In 2011, the best interest rate I could get at my primary bank was 2.4%. In the following months, I watched the rates dip towards 1.75%, 1.25%, then 1% and it kept going down.

Nowadays, the best interest rate you can get at the same bank is 0.3%. Three tenths of one percent.

Anything less than 2% interest did not seem worth it to me. I'd feel better having the liquidity of my cash.

One month ago, after some research, I found that there is still a bank today that will offer 2% on a certificate of deposit. 

As of 5/12/14, that bank is ---------------.

For fun, I put together this illustration if interest rates stayed at 2% for the next 40 years (I have no idea how realistic that is).

This illustration has a man putting $10,000 into a CD gaining 2% per year for 40 years.

age	amount	rate	addition	compound		principle	interest
27	10000	1.02	0	10200		10000	200
28	10200	1.02	10000	20604		20000	604
29	20604	1.02	10000	31216.08		30000	1216.08
30	31216.08	1.02	10000	42040.4		40000	2040.402
31	42040.4	1.02	10000	53081.21		50000	3081.21
32	53081.21	1.02	10000	64342.83		60000	4342.834
33	64342.83	1.02	10000	75829.69		70000	5829.691
34	75829.69	1.02	10000	87546.28		80000	7546.284
35	87546.28	1.02	10000	99497.21		90000	9497.21
36	99497.21	1.02	10000	111687.2		100000	11687.15
37	111687.2	1.02	10000	124120.9		110000	14120.9
38	124120.9	1.02	10000	136803.3		120000	16803.32
39	136803.3	1.02	10000	149739.4		130000	19739.38
40	149739.4	1.02	10000	162934.2		140000	22934.17
41	162934.2	1.02	10000	176392.9		150000	26392.85
42	176392.9	1.02	10000	190120.7		160000	30120.71
43	190120.7	1.02	10000	204123.1		170000	34123.12
44	204123.1	1.02	10000	218405.6		180000	38405.59
45	218405.6	1.02	10000	232973.7		190000	42973.7
46	232973.7	1.02	10000	247833.2		200000	47833.17
47	247833.2	1.02	10000	262989.8		210000	52989.84
48	262989.8	1.02	10000	278449.6		220000	58449.63
49	278449.6	1.02	10000	294218.6		230000	64218.62
50	294218.6	1.02	10000	310303		240000	70303
51	310303	1.02	10000	326709.1		250000	76709.06
52	326709.1	1.02	10000	343443.2		260000	83443.24
53	343443.2	1.02	10000	360512.1		270000	90512.1
54	360512.1	1.02	10000	377922.3		280000	97922.35
55	377922.3	1.02	10000	395680.8		290000	105680.8
56	395680.8	1.02	10000	413794.4		300000	113794.4
57	413794.4	1.02	10000	432270.3		310000	122270.3
58	432270.3	1.02	10000	451115.7		320000	131115.7
59	451115.7	1.02	10000	470338		330000	140338
60	470338	1.02	10000	489944.8		340000	149944.8
61	489944.8	1.02	10000	509943.7		350000	159943.7
62	509943.7	1.02	10000	530342.5		360000	170342.5
63	530342.5	1.02	10000	551149.4		370000	181149.4
64	551149.4	1.02	10000	572372.4		380000	192372.4
65	572372.4	1.02	10000	594019.8		390000	204019.8
66	594019.8	1.02	10000	616100.2		400000	216100.2
67	616100.2	1.02	10000	638622.2		410000	228622.2

Over 41 years, $410,000 was invested into CDs. The interest gained would have been $228,622.20.

Under this illustration, the average return per year is $5,576.15.

Save time and money by not voting

In the K-12 school system and in college, teachers and professors would talk about how important voting is.

It never made much sense to me.

The teachers would say it is a patriotic duty to vote, every vote matters, and some elections came down to one vote.

This just seemed like a load of to me. I get the impression they try to encourage as many people as possible to vote for democrats.


The president of the United States gets elected by winning the majority of the electoral votes, not the popular vote. The election many teachers refer to is the US presidential election of 1876. Rutheford Hayes vs Samuel Tilden. Rutherford won 185 electoral votes while Samuel won 184 electoral votes.

In this election, Rutherford won 4,034,311 popular votes while Samuel won 4,288,546 popular votes.

This would not be the last time in history this happened. I think most people still remember the presidential election of 2000. Bush vs Gore. Bush won 271 electoral votes while Gore won 266 electoral votes.  Al Gore won 500,000 more popular votes than Bush did.

With this evidence, voting seems somewhat irrational.

Most states tend to vote the same way, either democrat or republican. This is why swing states are the most important states to win in an election.

The best example of this uselessness I can give is the most recent election of 2012.

After talking to an old friend, she said she voted for Obama.

Living in Georgia, I came to the conclusion that everyone in Georgia who voted in the election completely wasted his or her time.

Georgia voted for Mitt Romney. If you voted for Obama, your time was wasted because the electoral votes for Georgia went to Mitt Romney. If you voted for Romney, your time was wasted because Mitt Romney lost the election.

It is difficult for me to believe that people think their vote actually matters.

If I had voted in the last election, either Obama or Romney would have become president.
If I hadn't voted in the last election, either Obama or Romney would have become president.
Either way, there will be a president.

By not voting, you save your gas and you save the time not waiting in line.

Maybe if it was possible to vote from the internet, I could feel a little better about it.

At least a man would not have to drive or wait in line.

The stuff I'm afraid of

My whole life, I'd have to say at least half of my motivation to do or achieve anything has been fear of something happening.

When I was younger, I came to the conclusion that if I didn't take the advanced classes in high school and go to college; I could expect to end up living homeless on the streets where I would eventually starve to death and die.

I was 14 to 16 at the time, I wasn't quite aware of how much welfare the United States provided.

I did my best to study as hard as I could, get the best grades I could, and maybe I could get accepted to college and have a chance for survival.

Nowadays, my biggest fear is the country falling to pieces because of expanding government, welfare programs, reduced economic growth, and fiscal irresponsible policies of the government.

I do my best to work hard, save up all the money I can, avoid any kind of debt, and keeping my expenses as low as possible.

In both instances, there were things I could control and things I could not control.

I could study hard or save lots of money. I can plan my entire life on spreadsheets and follow my plans as diligently as possible.

Despite all of that, I could get killed in a car accident tomorrow.

There are just lots of things that fall out of your control.


What is the best way to deal with fear?

I guess if you can do something about it, it might make you feel better.

Maybe the economy will collapse in the next 5 or 10 years.
Maybe the price of everything will become 10 or 20 times more expensive.
 That part is out of your control.
But if you feel like this is a threat, maybe it would be a good idea to start stocking up on some extra food.

Buy some precious metals, stock up on supplies, convert some paper money into tangible goods.

Go ahead and buy this stuff today when it is cheap. Buy it before prices increase.

Maybe you might want to research other countries and see if expatriation is an option.

If America falls apart, we are all going to be screwed. But if you spent a little time preparing for it, you might be able to cope with it a little better.

Want to be more successful? Quit smoking.

There are 3 difficult habits that plague most Americans.

Alcohol
Cigarettes
Marijuana

This post will focus on Cigarettes.

It is not easy, but if you can give up smoking, you can expect to live a more successful life.

While most people emphasize the fact that smoking causes cancer, I'll focus on the cost of habitual smoking.

Depending on where you live, a pack of cigarettes can cost anywhere from $5 (Kentucky) to $15 (New York).

http://www.theawl.com/2013/07/what-a-pack-of-cigarettes-costs-now-state-by-state

Assuming someone actually did smoke a pack a day, the cost of cigarettes over one year would be anywhere from $1875 (Kentucky) to $5475 (New York).

Thankfully, or hopefully, most smokers don't smoke 20 cigarettes in a day. I can assume a more reasonable amount would be 2 packs a week. Averages out to be 5 or 6 cigarettes a day.

This brings the annual cost of cigarettes to about $520 to $1560.

Over the course of 10 years, the cost of cigarettes would come out to be between $5200 to $15600 (not factoring inflation).

The $5200 to $15600 could have been saved or allocated to other expenses like gas, food, insurance, clothing, or housing.

If you decide to quit smoking, realize that the sooner you quit, the more benefits and savings you will realize in the long run.