Moving to An Asset-Orientated Life by Greg G.

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If you're a long-time reader of this blog you know what to do to get prepared. Stock up on food for short and near term survival, find a location where like minded people live. Become physically fit and active, and train in self defense. But all of these things cost money. My article goes towards moving to an asset orientated lifestyle to achieve your goals.

When you're cash poor, it is tough to even think about planning. If you read these articles about guns and survival food, and retreat locations and wonder, while the dispute between .223 and .308 is interesting, or the decision to buy a retreat in Idaho County, Idaho versus somewhere in Eastern Oregon is interesting – the more practical and immediate matter is how to pay your current bills. Trying to focus on these long-term goals can be stressful if you are cash-poor or have lots of debt. But by readjusting your every-day purchases to be asset orientated, everything you buy or own can be a step towards your preparation goals.

Consumerism is America. We are inundated from the moment we turn on the computer, television, or radio with ads for something. We are told that the newer product is a must have, and is definitely worth buying. As we know, it usually isn't.

Most of us have bought a car, and are familiar with automobile depreciation. The car, from the moment it rolls off of the dealer’s lot, is worth less than when purchased. Magazines like Consumer Reports emphasize buying cars, if you buy them new or used, with resale values closest to the purchase price. This way you can recoup most of your purchase price when you sell or trade the car in. This mindset of asset orientated purchasing can be applied to everything you buy.

The first step towards becoming asset orientated is to view everything you own as having resale value, and everything you plan to buy as having future resale value. Marketplaces like Amazon, eBay, and Craigslist have revolutionized the marketplace for your possessions, and created a global instant market for them. In a pinch, you can sell most things in a matter of days for partial value on any of these sites. While in the past you were limited by who could come to your garage sale, or what you could sell or trade with your friends and neighbors, this is no longer the case.

So what stuff of yours has this resale value? Literally everything. Clothes, shoes, books, food, electronics, dishes. Anything. Now as you might imagine this resale value varies. Let’s use a purchase of a pair of jeans as an example.
Suppose you’re somewhat fashion conscious and have worn holes in your jeans that you wear everyday in the office. After staring at the jeans in disgust, you decide that you want to spend no more than seventy dollars for a new replacement pair. What do you buy? Do you go to department store A to buy Levis for $50 and keep $20, or do you go into debt using the store credit card at department store B to buy the Sevens for All Mankind you really want for $159?

As Margaret Thatcher would say, No. No. No. Debt is evil.
The first think you do for your jeans purchase, or the purchase of any item is to see what your purchase is selling for on Ebay or Craigslist. This will give you a base value for your purchase, or what you could get for it in a pinch if you needed the money you spent for it for other things. Suppose the average resale price of Levi's on eBay is $9.99, and the average resale price for the pair of Sevens you want are $65.

The next decision for you to make is to see if you could do with buying a used pair of jeans. This would be the cheapest and most efficient purchase, since your base purchase price would equal your resale price. Thus, the $9.99 or $65 investment you make into the pair of jeans could be almost fully recouped (assuming your treat your clothes carefully) upon resale. It is like getting free use of a pair of jeans for as long as you need. In realizing this, I do not buy new clothes or other items if used ones are available. But what about sizes or fitting you ask? You may be scared to buy an item online if you are unable to return it and it does not fit. So here is what you do. Go to wherever the item is sold, and try on the article. After trying it on, write down or record the the item details on your phone, and see if the item is being sold by a trusted seller on eBay or craigslist. That way you've “tried on” the clothes without having to buy
them, and can purchase them cheaply used online.

Now it is worth mentioning that eBay does take about 10% cut of the item should you list it for resale, but even still, a $1 loss on a $10 item or $6.50 loss on a $65 item is much better than the $40 loss you would take on the new Levis or the $84 loss you would take on the Sevens. Ouch. So by doing this, you learn to take care of your clothes and start thinking about resale value. Also, by routinely churning through your belongings you also lose attachment to material things – which is a good thing since they don't matter spiritually in the end.

Full Exchange Stores

One way to ensure a high resale value for your purchases is to shop at stores that offer 100% return policies - even if they are more expensive. If something were to go wrong or not work with an item you buy, you rest assured that it is exchangeable or returnable. Or if you need the money you spent for the item in a pinch, your purchases are easily returned if in saleable condition. Its the ultimate willing buyer, willing seller exchange. Now are these returns moral? Remember, the stores with more lenient return policies often have higher prices and build into their prices that people will return their items. Thus, the consumer is paying a premium for the cost to the store of returned items up front. So if the store offers the policy, use it if you have to, since it is included in the price. Some stores even recoup their returns by reselling the returned items – REI’s gear sales are great example of a resale of returned outdoor equipment and
clothing, especially barely-worn boots, for clearance prices. Find and use these sales where you can. Thus, it is my belief that if a store offers seemingly lenient return policies, they want consumers to use them. So keep those receipts and take advantage. But be aware that stores can change their policies at any time, so only buy necessary items with a resale value close to the purchase price to protect yourself should the store policies change. And if you don’t believe this to be morally correct, don’t do it.

Food

You can use the asset approach approach for food purchases as well. Make a list of food that you would like to stock up on. As other writers have suggested, try to mimic your usual diet in your preparedness food. So if you normally eat frozen pizza rolls, a preparation purchase at Costco for 50# of wheat germ probably would not be a wise choice for a smooth diet transition WSHTF. But then or now, you probably should not keep eating the processed frozen pizza either. Others have written about the diets you can plan, and how you can improve your diet. I offer nothing new here, except on how to buy the food you need.

When you buy the food, think of each purchase as the purchase of assets. Get the lowest price you can. Figure out the items you want and look at couponing sites to see if and when any coupons exist or the items. Coupons are money given from the manufacturer to you to entice you to buy their products.
The manufacturers print coupons every week to entice new buyers. Take them up on their offers. Say you really like Ocean Spray Cranberry Juice drink and would like to stock up on ten two-quart bottles for your provisions. Many people have gotten into the couponing craze, and there are coupon blogs for all parts of the United States that show when coupons are printed in the newspapers, and how to combine them with store advertised and unadvertised specials to stock up on really cheap food. Take advantage of them and clip them for the juice if they are available.

Because many of the stores in the blog are in my area, if I was purchasing the Ocean Spray drink, I would review www.frugallivingnw.com, to see if coupons for the drink are coming up for print. If they are, I would either buy the newspapers where the coupons are printed, and cut the coupons out of the papers myself, or buy already-cut ones on eBay., Then, I would use the coupons and combine them with any deals indicated in www.frugallivingnw.com to obtain the best deal.

Why pay $4.29 a bottle for the juice when, after couponing, you pay $1.99 - or sometimes if its a really heavily promoted by Ocean Spray, nothing at all. And if you “overbuy” or you don't use it, keep your receipts and return the food, again if it is in saleable condition. If you itemize your taxes, you can also donate to charity to recoup your unused food purchases this way as well. YMMV.

Preparation is achievable for anyone who becomes asset orientated. To avoid being overwhelmed, make a list of all the things you want to buy or need to get prepared. Only buy necessary things with high resale value. And shop, where possible in stores with 100 percent return policy. And help your neighbors with your “overbuys” when you can. Good luck.

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This page contains a single entry by Jim Rawles published on January 1, 2013 4:24 AM.

Resolving to Start the New Year Right was the previous entry in this blog.

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