Hey guys,
I’ve been away from the forums for a while due to family issues. I’ve been doing a lot of reading, however, and I just finished up John Perkins “Confessions of an Economic Hitman” and before that Schiff’s book.
For a while now, I’ve feel the need to do something to secure myself economically for our coming (unstable) future, but every time I try to formulate a plan I end up frustrated. In the past I’ve looked towards our community here for guidance and suggestions, so I’ll try it again.
Here’s my situation:
I am 25 and I work as a Software Engineer for a large American market analysis firm. I’ve lived in Prague, Czech Republic for a little over two years now. I plan on remaining here (or at least in Europe) for the foreseeable future. I have no credit card or car debt, but also no cash savings. I have about $20,000 in student loans (some high-interest private from Citibank and more FAFSA, low interest for life). I have begun paying off the Citi loan, with only $7,000 remaining which I expect to be gone in the coming months as I complete a side project I am doing for a US client on weekends.
So besides the soon-to-be $13,000 in low-interest FAFSA student loan debt, my only other debt is in the form of a 10% holding of a Czech private real estate company. The other 90% is held by my father, who wanted to diversify his real estate holdings. The firm holds three new apartments in Prague, all financed with 15 and 17 year mortgages holding a fixed interest rate for the first 3 or 5 years. The 10% ownership is for tax reasons; in reality it’s more of a 50/50 split. This was part of my “savings for the future” and what I use to justify my zero cash-on-hand savings.
Here is where I go from here:
My day job doesn’t pay so well. My plan is to use this money to live and to travel. On the side, however, I expect to continue doing development work that could generate between $5,000-$20,000 extra a year in cash, sitting in my US bank account. I would like to split this money to accomplish one or possibly two goals. The first - and important - goal is to cover my ass, as much as possible with these limited funds, from a global recession. To this end I have been looking at buying metals, though I can’t find a good place to buy in Czech Republic (all the guides/suggestions are for US companies). Suggestions? The second goal, if possible, is to use the money to start a small side business. What this looks like I have no idea. I’ve even researched starting a small-scale farm in the countryside (land and labor here are dirt cheap, so buying a small plot and hiring a pensioner to work it is possible, but I hate the idea of taking out another mortgage). The farm idea is good for these reasons: it’s real estate, which is booming here, so it could look like a traditional investment (though I know how fickle it is). Two, it’s a farm… food is sure thing during any recession. In a real emergency, I could ditch the flat in Prague and move out to the countryside where living is cheap and more stable. Lastly, a farm could actually turn a profit if done right, perhaps getting into Organic meats or something. What I don’t like about the farm idea, however, is that it’s extremely labor intensive, and right now I just don’t have any time… at all.
So… ideas?