Thank you for All You’ve Done for Me and Others

Question:

Dear Steve,

I am alone in the world. I lost my parents at 16 and worked hard to put myself through school, grad school, flight training, and a career as a pilot.

I was married at 33 and tragically widowed at 37. As a result, I have had to make many financial decisions, good and bad, alone.

Seeing the airlines headed downhill, I put myself through law school while flying full-time. It has been a lonely journey.

I have done reasonably well. I just wanted to let you know that your articles were well written and stayed with me through the really tough spots for a long time.

I felt you understood the hard choices, and reading your articles made it so much more bearable for me.

I saw a picture of you and your wife and dog in front of a Cessna. I hope you have a wonderful time flying that airplane and know you have really helped people.

What will happen with inflation, and how do you recommend hedging?

Soma

Answer:

Dear Soma,

Thank you for the kind words. While the struggle has been arduous, it sounds as if you made some excellent choices for your life.

I’m a commercial pilot that flies for public safety and the fire department and is involved with aviation daily. It is a crazy field with your entire livelihood depending on many factors out of your control. But all it takes is one health event, and you could be grounded.

I’ve been through my share of challenging life experiences. But unfortunately, the challenges never seem to end. On the aviation side, I’m jumping through hoops to get my new amphibious rating and sell that airplane you saw.

It is easy to get wrapped up in economic fear on the financial front and think it will collapse. I’m old enough now that I’ve seen these cycles come and go repeatedly.

I still think the fundamentals are strong for the long term, regardless of the blip of inflation we are experiencing now. But, of course, there will always be disturbing things like home affordability, too much debt, exploding rents, higher taxes, and my biggest worry for people, retirement savings.

I’m much more worried about Social Security not being able to provide even a poverty level standard of living for people that have not adequately saved for retirement. Social Security was never designed to be the primary source of retirement income, only a supplement.

Long-term investing in stock market index funds have been a great investment vehicle. I recommend either investing in a low fee down index fund or using a more expensive money manager to watch over your investments.

The one investment opportunity I’ve been exploring is cryptocurrency.

I’ve been testing different strategies for investing and have learned some painful lessons up to this point. Initially, I lost a few thousand while I learned crypto investing lessons.

Still, I think I’ve finally managed to develop a system that minimizes the downside while being patient with the upside. Things have been looking up with returns being about 5 percent a month. That beats inflation.

I just went and looked through this past post of mine about investing in crypto, and I’m surprised how much has already changed.

When it comes to “hedging for inflation,” my approach is probably way too simplistic and not sexy at all.

Inflation drives up costs. So knowing costs will increase, I take this as an opportunity to revisit all of our monthly obligations. Some can be canceled or reduced, which helps save money each month.

Other changes are more lifestyle-oriented. For example, eating at home is the rule rather than eating out.

The best advice I can give you is to be smart with your money, be happy, embrace gratitude, and be hopeful for the future.

Your kind words made my day, and each time someone says I’ve made even a slight difference, it makes the work worthwhile.

Sincerely,

You are not alone. I’m here to help. There is no need to suffer in silence. We can get through this. Tomorrow can be better than today. Don’t give up.

Damon Day - Pro Debt Coach