How To Thrive And Survive During An Economic Collapse

How to survive economic collapse

Will you be able to survive the next economic collapse? You might still have a small gap of opportunity left to prepare for the worst.

There is nothing worse than waking up the next morning, turning on the tv only to reveal that the country you live in is in a deep panic because the economy has fallen.

Your currency has lost most of its value. Your employer became bankrupt, and you now sit without a job.

How are you going to pay your mortgages?

Luckily you are not entirely helpless just yet as there are multiple things that you can do to prepare for this event. In this article, I am going to cover basic economics, how to prepare, what you can do to become more self-sufficient and also how to manage your finances more effectively.

Are you ready?

Economy 101

Before we can discuss certain matters on how to survive the collapse of the economy, we need to have a basic understanding of how the economy works. In this section, I will discuss the causes, history and the effect the economy will have on you.

a) What Is An Economic Collapse?

The term economic collapse has many other terms associated with it which include “financial collapse” and also “economic depression.” This event happens when a country is very deep in debt and has no money left.

Almost every sector in society is affected and ranges from single households up to large companies. Some of the symptoms might include hyperinflation; companies become bankrupt which leads to unemployment.

An event of economic collapse can happen in steps or overnight after a catastrophic event. It can also take years for a country to get back on its feet.

b) What Causes The Economy To Collapse?

Before we can discuss the causes of an economic collapse, we need to have a basic knowledge of how the economy works. The economy is heavily driven on psychology and follows the rules of supply and demand.We need to understand that supply and demand must be allocated to a specific product or service as they might vary across the board. The meaning of supply comes from the producers that manufacture a particular product. Demand comes from the consumers or buyers for that specific product.

Supply and demand on economic health

The supply and demand need to reach an equilibrium to determine the value of a specific product. The value of a currency has a massive effect on this equilibrium and affects both the supplier and consumer of that product.

As the inflation rate increases, so will the price level of goods and services in a specific country which stretches over a particular period of time. This is because of the amount of money being printed by a country. The more money in circulation, the lower will its purchasing power be.

Anything that disturbs the equilibrium of supply and demand might cause an economic downfall. Below are some examples of such events.

  • Natural resources such as oil (its price and supply).
  • An EMP attack which causes power grid failure in a country.
  • The unrest that comes from a war which might include civil war or another world war.
  • Natural disasters such as tornadoes, earthquakes, hurricanes, volcanoes, floods, etc.
  • Rising inequality can also lead to financial depression.
  • Massive debt within a government.
  • Shadow banking practices.
  • Corruption is another cause.
  • Political policies that can influence the economy.
  • Stock market crashes.
  • The devaluation of assets such as houses and properties.
  • The collision of other currencies. For example if the dollar crashed, the Euro will be next.
  • A Massive change in inflation.

c) It’s History And Track Record

In this section, I will cover the events of when the economy of a country collapsed or almost did. I will start from the credit crisis in Britain in 1772 to the Asian panic in 1997.

The credit crisis in Britain (1772)

The credit crisis escalated quickly when Alexander Fordyce fled to France to escape his responsibilities to repay his debt. This event led to massive banking panic and caused most of the creditors to withdraw all of their money from the banks. This event also spread to other parts of Europe.

French Revolution (1789)

This event happened right after the French monarchy collapse in 1789. This was an era when inequality reached its peak and allowed the wealthy elites to own most of the wealth in France. A ton of money was spent on the war of the American Revolution and resulted in massive debt.

french revolution

Railroads And Silver Crisis (1893)

Many people were reliant on railroads for transport during this era while the cost of laying them could not be covered. The Philadelphia and Reading Railroad could not include the cost associated with the railroads, and they became bankrupt. The silver market also crashed because of overproduction as there were not enough buyers for this metal.

The Great Depression (1929)

The great depressions were one of the most disastrous events related to the economy of the United States. It resulted in the highest unemployment rate in the US and a massive loss of income. The government has little control over the economy market prices reached a very high level. It also resulted from the stock market crash where most investors were wiped out.

The Asian Panic (1997)

This crisis developed because of the overextension of their credit and too much debt. A lot of investments were reversed because of widespread panic as investors realized that Eastern Asian countries were bankrupt. Thailand’s government also abandoned its exchange rate against the Dollar because of a lack of money. 

d) It’s Effect On You

Such an event will affect almost anyone living in the country in which it has happened. At first, you will not have access to credit as most banks will have to close down.

Interest rates will rise at a very high level, and everything will start to become very expensive. You might fall victim to retrenchment from your job or it might just close. As companies close, the supply of products will fall while the demand will stay the same which will also increase the cost of products.

Governments can also collapse which will affect the supply of electricity and water. The crime rate will rise as people will become desperate which will turn the country into anarchy. As an effect, you will need to learn how to survive on your own.

Preparing For Economic Collapse

You cannot always avoid an economic meltdown, but there are things that you can do to prepare yourself for if it happens. I am going to discuss the barter system as an alternative to cash and also other types of investments that do not rely that much on the currency of your country.

a) Using The Barter System

As you may have already noticed, the currency system will have little value when the economy collapses. Even if it has little value, you might not even be able to withdraw your money as credit.

You will need to make use of another exchange system where you need to trade assets or goods without using cash. Think of the olden days before money was invented where you had to exchange a chicken for a block of cheese.

Some resources will have more value than others. Their value will also be determined to the extent of the severity of the economy. You should also remember the supply and demand principle. Let me show you some examples below.

If the power grid goes off, then the supply will fall massively, but the demand will still be at the same level. If you have generators or solar panels, then you can either exchange them for some very valuable or you can exchange the power for other goods.

Some people will also not have access to clean water, where you can clean it for them with your filters in exchange for another resource that you might lack.

If you are homesteading and already have an abundant enough supply of chickens, then you can exchange those in excess.

You can also exchange for your services. For instance, if you are a handyman or mechanic, you could also fix houses and cars for food supplies and equipment.

If you have weapons, you can offer protection services to people that cannot protect themselves.

You can also focus on some simple necessities such as soap, blankets, alcohol, food and also chocolate.

b) Buy Precious Metals

Precious metals will mostly include gold and silver as they can be hedged against hyperinflation. These metals pose a complicated problem because it will have little value after a post-economic meltdown.


Because you cannot directly eat gold or wear it against the cold. It has little value for survival but will provide value for the long term. Some people will always value gold and be willing to exchange their last loaf of bread for it.

precious metals gold

If the economy manages to recover, you can then sell all of your gold to get a nice stash of cash which will help you to continue where you left off. If you own large bars of gold, then you should melt it down to something tradable such as coins. It is also better to lose one golden coin than to lose a whole bar.

You can also go for copper and platinum.

If you have a large stockpile of copper coins (which has little to no value), you can then melt them down and exchange them for something else because copper has a lot of properties.

c) Get Out Of The Country

Sometimes, you are far better off in another country which has a more stable economy. Some of the wealthiest people buy mansions in New Zealand as an escape route away from the adverse effects of a country which is under depression.

You can start by researching countries that are more stable and by updating your passport. You can also travel to one of those countries to better prepare yourself.

It is also important to note that corruption is everywhere and can pose a risk in almost every country. You also have the problem of leaving some of your relatives behind. You need to sit and carefully decide whether this option is worth it.

d) Invest in Bitcoin

The world of cryptocurrency also has tangible value when it comes to its exchange. It started from just under $100 per bitcoin up to more than $20 000 per bitcoin in less than 2 years.

This proves that Bitcoin has value and can be exchanged for goods. It also has the same problem as precious metals regarding its immediate value just after a financial crash. Some people might want to exchange for bitcoin while others won’t.

invest in bitcoin

Cryptocurrencies are not regulated by the banks which have its pros and cons. To invest in Bitcoin, you need to have a Bitcoin wallet. You can get one from its original website or other websites such as Coinbase or Bitfinex.

You can also wait until the economy has regained its health and then sell all of the Bitcoin to get some extra cash on hand. 

e) Buy Land

If you do not have any debt, then you have the option to buy land. If you have a piece of land, then you can grow your own crops and be more self-sufficient when it comes to food.

It will also be much safer if you are out of reach of desperate people that are willing to break into your house to steal. You should also try to buy land that has a well or borehole which can provide water for you and your family.

You also want to make sure that you are far enough from large crowds of people that are willing to attack you for supplies. Try to buy a property that is at least 10 miles away from the urban area.

Becoming Self Sufficient

If money has lost its value, then you need to be more self-sufficient to survive. You cannot always rely on the authorities to supply you with resources. You will need to learn how to store and purify water, store food, learn how to protect yourself, etc.

a) Learn how to Store & Purify Water

Even if you manage to get your hands on water supplied by your municipality, it will be far too risky to drink it.

Ask yourself this question.

If the municipalities are out of money, then how can they afford to clean the water supply. For all you know, the water can contain harmful bacteria which will cause diarrhea.

This is the reason why you need to learn how to purify the water just in case. There is also the risk of the water being shut off. You can start by buying water filters and purification tablets. You can also boil the water which will kill most of the bacteria present in untreated water.

You can also store clean water in large containers which might last you a month or two. Try to have at least one gallon of water per person per day. Another thing to realize is that water is a precious resource that you cannot go without, and people will pay a fortune for it.

You can also barter this resource in exchange for other items if water is scarce.

b) Store Enough Food

Do you even have enough food in your house that will last you at least a day or two? If your answer is “no,” then you need to stack up on it. You should also make sure that you only stack up on food that has a long shelf life.

It is important to note that the food industry operates on a small profit margin and will be the first to break when the economy falls. Food might also become too expensive in the case of higher inflation.

You also want to avoid most supermarkets as you will be faced with hungry looters and desperate people that will even steal the clothes that you are wearing.

food storage

What is the use in storing food that will spoil after a day or two if the freezers go off?

You can start by buying canned goods such as meatballs, spaghetti, canned meat, and vegetables. Make sure you have enough food for your pets as well.

Another mistake that people make is that they only focus on one type of food. You need to consider vitamins and minerals as well. Try to include at least ten different types of food ranging from vegetables to canned fish which has healthy oils.

You should also store rice and flour which are high in energy. You can also grow your own food which will be discussed later.

Your stored food should have enough energy, protein, vitamins, and minerals to have a healthy lifestyle still. You should also keep in mind that electricity might also become a problem. Try to store food that does not require it to be cooked or focus on cooking methods that do not require power.

c) Learn How To Defend Yourself

I already mentioned that desperate people would lose all of their morality to get what they want or need. If you know some karate or any other self-defense style, then good for you. If you do not know how to defend yourself, then you need to get that aspect of your life in order.

This might mean that you will need to possess a firearm and learn how to use it. Just make sure that you do not break any laws related to that of your country because guns can be a sensitive topic.

For both men and women and would recommend a 9mm handgun which would be more than enough to defend yourself. If you are a boy that loves big guns then why not?

If guns are not for you, then I would recommend tasers or pepper spray. You do not need to have a license to own any of these and everyone can use them with some basic training. They will also be more than enough to stop your attacker in his tracks.

I would not recommend that you become the next Rambo or Steven Seagal regarding hand-to-hand combat. Fighting with your fists might be very useful when the odds are even, but I have learned one thing, and that is that the world is not fair.

d) First Aid & Meds

During these desperate times, you might not even be able to afford a doctor, or you might not even have access to doctors in the first place. It is because of this scenario that you will need to learn how to treat yourself and other people properly.

You might not be as professional and experience as a medical doctor, but at least, you will be able to treat minor wounds and cuts. You can start by storing up on a broad spectrum antibiotic that can treat most of the infections that you might be exposed to.

first aid

This skill can save a life and is well worth it. You can also invest in a medical or first aid kit which has most of the supplies that you need to treat minor wounds.

The medical kit needs to have a at least the following items:

  • Disinfectant
  • Gauze pads
  • Bandages
  • Latex gloves,
  • Tweezers
  • Scissors
  • Antibiotic ointment
  • Broad-spectrum antibiotics
  • Pain relievers such as Aspirin

e) Protecting Your Home

Desperate people will go very far to get what they want, and some will even follow you to your house to know where you live. It will give them an opportunity to spectate you from afar to find the right chance to break in and steal all of your valuable supplies.

You went through all the trouble and effort to build up supplies for your survival while those lazy pestering individuals to take it. Protecting your home does not need to be that hard, and you can start with the basics.

You can start by identifying weak points around your home such as the windows and doors. You can then strengthen these areas with burglar bars on your windows and putting extra hinges connecting your outside doors and putting on a deadbolt lock.

If you have valuable items outside solar panels or generators, then you can put on an electric fence or a devils fork fence. You can also install solar powered motion lights to spot movement easily. By installing an alarm system in your home, you can have a better sleep at night, and hidden cameras can also help at keeping criminals away.

f) Learn Homesteading

If you want to live the 18th-century lifestyle, then you will need to learn how homesteading works. Homesteading involves a lifestyle where you need to undertake self-sufficiency to provide food for yourself.

If you have a small piece of land which you can turn into vegetable gardens, then you will have the opportunity to do so. I can still remember the times when I had a small piece of land. I planted sweet corn, green beans, beetroot, carrots, onions, pumpkins, watermelons, etc.

If you do not have a lot of space, then you can buy large pots and start a garden in them.

I also canned the excess vegetables for preservation. I had a small chicken coop where I had a fresh supply of eggs each day and meat all year around. I also used chicken manure, so it was a win-win situation.

You can also raise rabbits in a small area which will provide you with meat as they bread all year around.

Proper Financial Management

Sound financial management can go a long in easing the effect of an economic downfall in your household. It will involve good spending habits, building up an emergency fund, clearing your debt and also having more than one source of income.

Proper Financial Management

a) Clear Your Debt

We all know that inflation will skyrocket once the economy has taken a hit and you do not want to spend the little money you have to survive on monthly payments to pay off your debt. You do not want to lose your home because of this.

There is also the risk of you losing your job, and you do not want to endure the stress to pay off any monthly payments. If your debt is paid and you lose your job, then you can focus on finding a new job.

You can start by living a simpler lifestyle which will improve your cash flow to which you can use to pay off your debt faster. You can also sell unneeded assets to gain capital which can be used to pay off debt.

When paying off debt, you should start with the loans which have the highest interest rate. Once they are paid off, you can move over to those with a lower interest rate. You should always start with budgeting in order know how much money you can set aside to pay off any debt.

You can also start an additional job or get an extra source of income which can also help in paying off debt. If you do not have a clue on where to start, you can always seek the help of a credit counselor.

b) Develop Frugal Spending Habits

The first step at spending less money is to know exactly how your spreadsheet looks like. The part is also integrated into the previous section on how to clear your debt. Once you have the data, you can then start to develop a plan.

You can start by asking yourself if you need to buy the items that you usually spend money on. You may want to cancel cable tv, eat out less, sell your car (if you can go without it or taking public transport) or try to work from home.

I will also note that homesteading can also help you a lot at saving money as you can grow everything yourself. You can generate your power with solar panels (which will also help you if SHTF). You can also practice recycling which can also take you a long way.

c) Save Money For An Emergency

Once you have already paid off your debt, you can start to save money into an Emergency Fund. This will allow you to have enough money for when the dark times arrive. If you are living from paycheck to paycheck, then you are in trouble.

How to save money

Make sure you have enough money to last you at least five to six months for if SHTF. You should also not touch this fund and only use it if you need to. You should also keep this fund separate from your checking account so that you do not tempt yourself.

If you plan to move out of the country when the trouble starts, then you should make sure you have enough cash to buy flying tickets. You can also spend some of this money on precious metals because cash might lose its value when the economy falls.

d) Live Without Credit

Most people do not take this to heart, but it is a great principle to follow especially if you can afford to do so. First, let explain the difference between a credit and debit card.

  • Credit card. A Credit card allows you to borrow money from the bank for each time you buy something at the store. It means that you do not need to have the money to check out at the store. Each time you swipe the card, the credit company or bank will pay for the purchase. At the end of each month, after you have received your salary, you will then need to repay the bank every month. You will also have a spending limit as to how much you can spend each month. This monthly limit will depend on your creditworthiness.
  • Debit card. If you pay with a debit card, the transaction will take money directly from your bank account. The monthly limit will depend on how much money you have in the bank.

At first, it is best to start with a credit card if you have no money in the bank and to move to a debit card once you have enough money to support yourself and your family for a couple of months. You can always keep a credit card at hand for when your bank account starts to become thin.

e) Diversify Your Income Sources

The chances are very high for you to lose your job if the economy falls. To better prepare for this, you might want to have more than one income source. If all of your income comes only from one source, then you will lose ALL of your income if should lose that source.

As the saying goes, never put all of your eggs in one basket.

You can start with maybe an extra job or have a business on the side. It might also be a good idea to diversify your skillset as well. You should also never stop at learning new skillsets and expanding your knowledge.

diversify your income sources

The online world offers many opportunities to generate extra income. You can start with freelance writing or learn basic handyman skills.

It all depends on your strong points.

You can also start with homesteading and begin to sell some of your produce. It will also be a great practice run for when the economy falls. The skillset of selling your food will also help to improve your bartering skills.

You should also not be afraid to use your talent in a way which will increase your cash flow.

Are you ready?

Hopefully, you are now better off than most of your peers and better prepared for what might be coming your way.

The economy as it stands is bad enough but for it to collapse is much worse. Make sure you go through this article and learn how to take care of yourself and your family.

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