• Backup Power. If you don’t have an old fashioned fireplace or stove, you should seriously consider getting a diesel generator. It might seem like overkill but you can get a portable diesel generator for under $300 if you look hard enough. Check out that link and look around — they’re cheaper than you’d think.

• Gold and Silver. Precious metals are the ultimate safe investment, because unlike stocks and paper currency, they’ve been worth something for thousands of years. No other government has even lasted that long, much a less a company, stock, bond, or even currency. Check out my gold coins website and my Live Silver Prices website.

• Food and Water. This should be a no-brainer, but it’s incredible how many people aren’t actually prepared. Having a year’s worth of food and water shouldn’t cost more than a few thousand, and you’ll probably consume it anyway. If TSHTF, this is obviously essential. Gold, silver, and generator electricity are pointless if you don’t have food and water.

• Guns and Tools. This is something most financial advisors don’t seem to understand, but it’s important. If things get bad, you need to be able to have the tools that enable survival — traditional tools as well as tools for hunting and self-defense. It might sound extreme, but throughout history this was considered a given — just because we’re in a modern age doesn’t change the timeless principles of self-defense and the ability of being able to provide food for one’s family.

• Books and Planning. Having a plan is essential to any level of predictable success. This arena is no exception. Want to be financially secure? Right a plan to achieve that security — otherwise, you’ll be secure only if you get lucky, and that’s just not safe.

Make sure to also check out my inflation rate website. Being prepared for inflation is also obviously important — no financial security plan is complete without providing for inflation and hyperinflation.

Having credit card debt can damage the credit score, which affects the ability to get a mortgage or apartment, a car, and the amount of insurance premiums. In some cases, a negative credit score can impact your chances of getting a job. Anyone whose credit score is lowered due to credit card debt will be paying a lot more money and have restricted opportunities compared to someone with a higher score.

When an individual has a negative mark on the credit history, the credit card company can raise its interest rates to the highest level. Someone who spends at interest rates of around 30 percent may face a hefty credit card payment. If the individual is unable to afford the payment, lifestyle changes may have to take place such as obtaining a second job.

Paying only the minimum required amount each month allows the credit card company to extend its “loan” to the individual for a long time. This means that the person will be paying a lot more in interest payments. It can be as extreme as paying thousands of dollars for something that cost only $100.

Once an individual accumulates debt on a credit card, the situation may only get worse. As the card continues to be used, the debt increases and so will the interest payments unless that balance is paid. The excess spending that is encouraged by having a credit card is not good for most bank accounts.

An increase in the money supply is what leads to inflation. With the recent economic crisis, the Fed flooded the market with new money to bail out entities like automakers and banks. During inflationary times, the prices of assets such as real estate, stocks, and bonds, increase. This means it costs more for investors to purchase shares of desired stocks.

The overall impact of inflation on an investment portfolio depends on the type of securities held. During inflationary periods, a company’s returns are often overstated. The company may appear to be growing but inflation may be the primary reason for this apparent growth. In addition, depending on a company’s inventory valuation technique, inflation can severely impact its earnings.

Investing dollars, whose values are shrinking, in things like gold coins helps individuals to protect their portfolios. Inflation has been the most consistent factor in determining the price of gold. During the most recent five year-long periods that had the highest inflation, the average real return on Dow stocks was -12.33 percent, while gold had an average real return of 130.4 percent.

To protect the financial portfolio against increasing inflation, buy some gold. In addition to serving as an inflationary hedge, gold also hedges against the declining value of the dollar. It is a safe haven investment, something an individual can turn to for security when confidence in the dollar and the government is lost.

The concept of diversification involves spreading money between different asset classes like money markets, bonds, property, and equities. Within stocks themselves, investors should also diversify between different industry sectors and levels of growth. This approach is recommended whether the market is soaring or sputtering.

Not every asset performs the same way at any point in time. When stocks seem to be doing well, it is common that bonds are not. During times of economic uncertainty, the prices of safe haven commodities like gold tend to increase. In addition, not every industry has the same reaction to market conditions. While one industry is performing well, another may not be, so holding shares representing each reduces the exposure to performance fluctuations.

It is also important to diversify between geographic areas, which includes some international holdings. This way, if a natural, political, or economic disaster strikes one location, the performance of investments representing other locations can compensate. When considering which asset classes to add to the portfolio, select a few from various geographic regions in order to reduce risk due to the volatility of any one.

Though diversifying the portfolio will not eliminate risk, it will lower it. Overall, it makes the financial picture much more stable for any investor. A crisis in one area will not wipe out the life savings but will instead be balanced out by other well-performing asset classes. Having an appropriate amount of diversification in the portfolio enables any investor to enjoy a positive experience in the financial arena.

Mr. Buffett claims that after his father, Mr. Graham was the most influential person in his life. Both he and Mr. Kahn gave their sons the middle name of Graham as a tribute to this intellectual investor. Mr. Graham came from poverty and began working on Wall Street at the age of 20. Eventually, he started the Graham-Newman Partnership.

Serious investors still refer to his 1934 book, Security Analysis, as an investment bible. Mr. Graham preached that anyone who participates in the stock market must distinguish speculation from investment. He believed that investments promise safety in terms of principal as well as a respectable return. Anything that does not have these traits should be considered speculative.

Like those who follow his philosophy, Mr. Graham believed that equity stock owners should regard their role primarily as partial owners of a business. They should not be overly concerned about erratic stock price fluctuations. He recommended that investors take time and spend effort analyzing a company’s financial standing. Shares trading at a price less than their intrinsic value make wise investments.

Mr. Buffett regards Mr. Graham’s writing that investments are most intelligent when they are most businesslike as the most important investment statement ever penned. Mr. Graham believed that investors are not right or wrong due to the agreement or disagreement of others. Instead, investors are right when their analysis and facts are right. Investors should focus on company performance and the receipt of dividends, not market fluctuations, if they wish to follow his approach.

When commenting about Mr. Soros, people have made remarks regarding his successful speculation ability. This enables him to withdraw when he is ahead of the game, resulting in impressive profits. Mr. Soros has written three books predicting financial disaster, which many equated to him crying wolf. Eventually, his predictions came true, in the form of the worldwide financial crisis.

Mr. Soros says his success is really due to his ability to recognize when his predictions are incorrect. He believes that this has allowed him to survive and prosper. He claims that when he is wrong, he feels it physically and once he makes an alternate decision, the pain subsides. Mr. Soros is a strong believer that the crisis that exists in the world financial system will not resolve itself anytime in the near future.

In terms of investing, Mr. Soros believes that an individual’s biases have an impact on market transactions, which can potentially change the perception of economic fundamentals. This concept is referred to as reflexivity. He says that the transitions in perceptions regarding economic fundamentals are indicated by disequilibrium.

Perhaps you believe as Mr. Soros does that the observation and participation of investors within capital markets can influence valuations as well as conditions or outcomes. Or, you may feel that other factors are responsible. No matter which way you see it, there is no denying that Mr. Soros must be doing something right because he has been able to amass a fortune through his investment actions.

Mr. Buffett subscribes to the value investing school of thought. This involves selecting stocks that are trading for less than their intrinsic value and this method of buying when the share price is deflated has resulted in enormous profits for this investor. Value investors like Mr. Buffett look for stocks that have high dividend yields and price-to-earnings or price-to-book ratios that are lower than average.

The techniques Mr. Buffett has employed permitted him to make most of his money through the stock market, not by founding a company. He has been able to double his net worth every three years for the past five decades. Mr. Buffett advocates that investors take time to make more informed decisions, looking at the transaction as buying a business, not a stock.

To be a good value investor, an individual needs to be committed to research. This involves reviewing financial statements, assessing the competition, and analyzing demographic trends. Investors must be diligent and once they have the stock in their portfolio, they need to determine the opportune time to sell it in order to make a profit.

With all of the money that Warren Buffett has made, he is known for being personally frugal. However, that frugality has not carried over to his behavior with others, as he pledged to donate 99 percent of his wealth to causes that are philanthropic. Some of us could stand to learn from this gentleman and follow in his footsteps.

Mr. Rogers is also one of the most successful investors of this generation. He entered the stock market in his twenties, holding a mere $600. By the time he was 37, he retired with more cash than most of us could ever dream of, let alone spend. From 2000 to 2003, he drove through 116 countries, capturing his adventure on paper in the book, Adventure Capitalist – The Ultimate Investor’s Road Trip.

Some of this investor’s most notable conclusions to avoid investments in India and Russia, despite their technology skills and natural resources. He supports investments in Mongolia, Uruguay, China, and even Tanzania. Based on his past investment success, few tend to argue with this advice, no matter how strange it may seem.

His predictions for commodities include the belief that these will outperform equities even accounting for economic recovery. However, he does not believe that all commodities will have the same results. According to him, gold will reach $2,000 per ounce. He believes that silver is a better investment because it is far below its all-time high. There are also opportunities in agricultural commodities like rice and sugar, which are still cheap.

Anyone interested in learning more about Mr. Rogers’ thoughts should read his blog, appropriately named “It’s Better To Be A Contrarian.” For him, these words have proven to be true, especially from a financial perspective. Here’s to all those people who refuse to give in to popular belief, choosing instead to follow their own instincts.

Mr. Lynch is also famous for coining one of the most well-known phrases in modern consumer investing, “Invest in what you know.” This principle is embraced by the average stock investor who does not have time to pore over financial reports or learn complex quantitative measures. Most people are considered experts within certain fields and using his principle allows them to find good stocks that are undervalued.

One of the other beliefs held by Mr. Lynch is that an individual investor can make more money from stocks than can a fund manager. This is because individual investors can identify good investments through their daily lives, long before Wall Street catches wind of these. In his writings, Mr. Lynch details the many investments he discovered when he was driving or shopping at the mall.

The belief that there are investment opportunities all around us is an optimistic one. We just need to focus on what is familiar to us, what we know. Following Mr. Lynch’s philosophy, individuals will invest in industries they understand, even if the industry or sector is predicted to deliver less than stellar performance.

Mr. Lynch promotes investment in undervalued stocks but he also advises investment in fast-growing companies within up-and-coming industries. The company should be profitable, have a strong business model, and feature a reasonable share price. In addition, we should stay fully invested, ignoring market fluctuations.

Rising inflation causes those dollars we work so hard for to have less purchasing power. This becomes clear when we see the prices at the pump and in the supermarket. In many cases, our employers do not provide us with wage increases that keep pace with these events, worsening the situation.

Gold serves as a hedge against inflation and is excellent at performing the task. Very high inflation can render paper money nearly worthless. Prices skyrocket, yet few people can even afford to buy the necessities. It becomes even more disheartening when one realizes that this situation is artificially created by our government.

Someday, there may be no more dollar bill and if that happens, those of us who only have dollars, stocks, or bonds will be in a bad situation. Investors who incorporated gold into their portfolios prior to such an event can tap into that precious metal. The value of gold will always be recognized, so the gold stockpile could be exchanged for products and services.

As an insurance measure, investors should diversify their portfolios with gold. Though the currency system may never be eradicated, one never knows. It is better to protect oneself against this and the high inflationary times yet to come, by adding some gold to the investments. There will never come a time when gold does not have value so there really isn’t anything to lose by making this move.