By Gary Kah, originally posted here
The world situation has become very unstable. The stand-off between Russia and Ukraine is intensifying and could result in an all-out war. Tensions between Russia and the Western Alliance (especially with the United States) are mounting. Meanwhile, the Middle East remains explosive, with Israel’s enemies continually threatening to annihilate her. Peace talks with the Palestinians are stalled and Iran is inching closer to a nuclear weapon. We could be on the brink of a global military crisis. The odds of a significant conflict erupting in the not-too-distant future are high. If war breaks out in Eastern Europe or the Middle East, the consequences would be extreme. Is there anything practical we can do to prepare?
Those who regularly read my articles know that I am most concerned about the spiritual condition of an individual because of the eternal ramifications. However, I understand that there are also legitimate physical and economic matters that our readers are concerned about. As Christians who seek to do what is right before the Lord, we want to make the wisest decisions in these areas of our lives as well.
It has been several years since we last focused on financial options and many of our subscribers have asked for advice on these matters. In order to be the best stewards of the resources God has entrusted to us, and as we prepare for turbulent times, it is appropriate to prayerfully consider our response in light of current global developments.
A few months ago, someone we know sold their business and, as a result, has been in the process of researching how to invest their money in order to produce the best results with maximum stability. Their goal is to diversify their portfolio, bearing in mind the importance of Christian stewardship. I’ve been given permission to provide a summary of their considerations, which I will be sharing in the following paragraphs along with a few personal comments. This is intended to give our readers an idea of what some small business owners with a conservative Christian worldview are doing with their money. This particular businessman, who we will call John Doe, is in the process of investing approximately 3 million US dollars – most of it in overseas funds or projects. Later on in this article, we’ll examine what those of us with little or no extra money might consider doing.
(Much of this information is also available on a DVD titled “Preparing for Turbulent Times” which was recently taped at a conference where I spoke. It may be purchased for $15 (plus shipping/handling) at our website – www.garykah.org – or by calling our orderline number at 317-290-4673.)
CAUTION: Before launching into this segment, I would like to emphasize that I am not recommending every reader invest exactly as John Doe. I am merely presenting his strategy to provide ideas as to what one might consider doing. I am not a financial planner. Every reader is responsible for his or her own choices and actions. Always prayerfully seek God’s will before making any major decisions concerning your finances.
THE INVESTMENT STRATEGY/OPTIONS OF JOHN DOE
(Based on $3 million of available funds)
● $500,000 in gold & silver bullion in Singapore ($350,000 in gold; $150,000 in silver). Go to: www.silverbullion.com.sg. Email: email@example.com. (They keep the bullion for you. You can cash it in anytime you like, depending on your agreement with this company. My understanding is they can wire it to you anywhere in the world.)
● $500,000 in land deal in South American country – a blueberry, almond, etc. farm. This was a $30 million income-producing venture that closed on January 31, 2014. This investment is projected to produce a 20% plus return by its 3rd year. While this opportunity is no longer open to the public, there will undoubtedly be other similar ones that come along. However, such investments can be risky and are only as good as the experience, integrity, and good fortune of the party heading up the venture.
● $500,000 in “Coopenae,” a Costa Rica government credit union. This fund has less than a 1% default rate on loans issued – a very solid financial institution. It currently produces a 10% annual return. However, one must be a legal resident or citizen of Costa Rica to participate.
● $350,000 in a Singapore bank. 6 – 8% APR. Money can be invested in any of several currencies. Must be careful which currency is chosen.
● $350,000 in a Hong Kong bank. 6 – 8% APR. Money can be invested in any of several currencies. Again, be careful which currency.
● John Doe is also setting aside up to $400,000 to purchase a house/condo (or two) in a stable country outside the US. This could double as an income-producing rental property and a place of refuge. If Doe chooses to rent out his property either on a full or part-time basis, he will probably want to locate a capable property manager to oversee this endeavor for him.
● Doe is keeping $400,000 in cash in case he needs it or wishes to invest in a unique opportunity that comes along, or wishes to make a donation of some kind. (The Lord knows our ministry currently could use all the help we can get – in case any of you investors feel led to make a difference for eternity!)
This strategy diversifies Doe’s portfolio and keeps him from “having all of his eggs in one basket.” He will have investments in 5 different countries outside the US, along with the US itself. He will also be spread out over several different types of investments – gold, silver, land, credit union, bank accounts (potentially in a few currencies), real estate (house/condo), and cash. He will not have more than 16 – 17% of his portfolio in any one investment. Half of his investment will be in gold, silver, land and a stable credit union.
It would be advisable for Doe to keep some cash (and a small amount in gold & silver coins) here in the US in case of a personal financial emergency or in case he gets trapped in the US and can’t get out if everything unravels. Some cash, of course, could be kept overseas as well. Maintaining a small bank account in Costa Rica or Panama ($50,000 – $100,000) that produces interest wouldn’t be a bad idea either. A 6-month CD at a Costa Rican bank currently pays around 5.5% interest (a Colones currency CD). However, you have to be a legal resident in order to open a bank account in C.R. This is now the case in most foreign countries and is a major change from only a few years ago when an American could travel just about anywhere in the world and open a bank account with less than $1,000.
Important: When wiring or transferring US money into a foreign account, if you want to convert your US dollars into another currency in order to place it into a foreign currency account, you could lose upwards of 5 percent of your investment due to the commission charged by the bank. The way to avoid this is by funneling your money from your US bank through XE Trade (a Canadian currency trading company) on its way to your foreign currency account. You will want to open up an XE Trade account in case you need it for this purpose. XE typically charges a fraction of one percent commission. When conducting a transaction through a foreign bank, as long as you’re dealing only in US dollars, there’s usually no problem – at least not at this time. But if foreign currencies are involved, always check with the receiving bank to see what kind of commission/exchange fee they charge before doing anything; even on a land investment or real estate deal. If a bank’s fee is high, then use XE Trade to convert the currency. (Regardless of whether your transaction or transfer of funds involves US dollars only, or whether it involves a foreign currency, ALWAYS inquire what fees or commissions will be charged; do this BEFORE conducting the transaction.)
Also, after investing in a foreign currency account, before pulling your funds back out in the future, always have the bank calculate what your money will be worth before they convert it back to dollars (or whatever other currency to which you want it converted), as currency rates fluctuate daily in relation to each other. These rate fluctuations will determine what your investment is worth on a given day. Consider this, the US dollar can fluctuate 10% or more per year in relation to another currency. So, in theory, even if you earn 8% interest on your foreign currency account, you could still lose money in a given year if the value of your currency has fluctuated by more than that percentage in a negative way. You only want to pull your money out at a time when the fluctuations are favorable for your intended conversion.
In addition, banks may charge a commission when you convert your foreign currency back to US dollars or into another currency. This percentage fee must also be factored into the equation. Foreign currency accounts can be tricky. They require caution and some extra diligence.
ADDITIONAL INFORMATION TO BE AWARE OF
● Beginning in 2014 US citizens must report to the Internal Revenue Service all foreign bank accounts & the amounts in each (and pay US taxes on earned interest). This law was enacted in March of 2010 and is called the Foreign Account Tax Compliance Act (FATCA). The non-compliance penalty is $10,000 per account, plus potential jail time. These need to be reported to the IRS by June 2014 and each year thereafter – always by June. It would be best to have your accountant file these reports on Form 8938 each year when you do your taxes; this way you will not accidentally forget and run the risk of being penalized. One exception: The only way to legally avoid having to file such a report is if the combined value of your overseas accounts equals less than $1,000.
● Real estate (land or buildings) along with gold and silver bullion are the only things you can own overseas and not have to report your holdings annually to the US Government. These overseas holdings are exempt. However, if you sell them and make a profit, you might have to report that – not sure as laws are changing. You’d want to check with a qualified CPA regarding each specific situation. NOTE: gold & silver “collectibles” held overseas do have to be reported.
● One may choose to first establish an irrevocable trust or a company in the Cook Islands or Marshall Islands and put your money under that trust or company before transferring it into other investments around the world. There may be significant tax benefits and legal implications. Also, you might be able to open foreign bank accounts with a smaller initial deposit if it is coming from such an entity. Under most circumstances, foreign banks that still accept American investors (95% no longer do) require a minimum initial deposit of $200,000 – $300,000 (unless you are a legal resident of the country you are seeking to open a bank account in, in which case you can typically open an account for $1,000 or less).
● Foreign bank deposit requirements and US and foreign government regulations are constantly changing, so you always want to obtain the most recent information that is available right before you make an investment – or else you could be blind-sided.
WHAT TO DO IF YOU DON’T HAVE MUCH MONEY
If your situation is similar to that of ours, the last of your concerns is what to do with a lot of money. Having been in ministry for over 20 years, living month to month while raising a family on a modest income, has not afforded us the opportunity to save up any substantial money to invest or even to lay aside for emergencies. Looking after two aging parents has stretched us even further. Many of you can relate. So what might the Lord have lower and middle income Christians do to prepare for difficult times?
Actually, one can do a number of things to position one’s family for a crisis. In fact, the following suggestions apply to families or individuals of every income category. For the record, our family has implemented each of these steps (to varying degrees) over the last few years. Therefore, we are not asking anyone to do what we haven’t already done ourselves.
● First of all, don’t be a loner. Start, or join a small group of like-minded Christian believers with a variety of talents, abilities and resources (20-30 people, or so). The emphasis is on variety, because you would need people with a number of different skills to ride out hard times. If everyone in your group is an electrician but no one knows how to grow and can food, you would be in trouble.
● Everyone in this group should live within 5–10 miles of each other (15–20 miles at most). In the event of an EMP strike, your car wouldn’t work. You should therefore be close enough that you could walk or ride your bike to a pre-determined location on a country farm where you would meet up with others in your group.
● Your designated location should have at least a few acres of tillable land (for growing food) and forest land (for firewood) and a fresh water spring – or be near a creek that could be a water source (if you have purifiers).
● Prayerfully, develop a group strategy of what each person would do (would “bring to the table”) in the event of a crisis. Then, quietly begin making preparations.
→ Purchase a good trail-bicycle for every member of your family. Also, owning some silver coins would be a VERY good idea (they could be used for bartering with other groups). In addition, I recommend that every family have at least 2 high-quality water purifiers along with a box of coffee filters. (You should always pass dirty water through a coffee filter before pouring it into a purifier. The coffee filter will remove a majority of the impurities, thereby preventing your purifier from clogging up; it will last much longer if you take this extra step.) If possible, you should also secure a minimum of 1 – 3 months worth of pre-packaged/easy-to-prepare food for each member of your family. Keep most of this at your designated location. It needs to have a long shelf life. This, together with your water purifier, would buy you some much needed time in the event of a crisis.
● Get together as a group every few months to make sure your plan stays on track. Make adjustments where necessary.
● Finally, and most importantly, prepare with a mindset of helping others during a crisis ‒ being in a position of sharing Christ with them if they are unsaved, but also encouraging and helping other believers who ignored the warning signs and were caught off guard or who, due to circumstances, were unable to prepare.
GOD WILL USE YOU – EVEN IN THE MIDST OF A CRISIS – IF YOU LET HIM. BUT, YOU NEED TO BE SPIRITUALLY PREPARED!
(This is the most important thing you can do.)
● Abide (remain) in the Lord Jesus Christ – synonymous to “walk closely with.”
Jesus declared, “Abide in me, and I in you. As the branch cannot bear fruit of itself, except it abide in the vine; no more can ye, except ye abide in me. I am the vine, ye are the branches: He that abideth in me, and I in him, the same bringeth forth much fruit: for without me ye can do nothing… If ye abide in me, and my words abide in you, ye shall ask what ye will, and it shall be done unto you… If ye keep my commandments, ye shall abide in my love; even as I have kept my Father’s commandments, and abide in his love.” — John 15: 4, 5, 7, 10 KJV
We must remember that without Christ we can do nothing of eternal significance. A close relationship with the Lord is mandatory if we are to remain stable and unshaken in order to help ourselves and others.
● Resolve to love and obey God no matter the cost.
Our obedience to the Lord is very important to Him. Jesus said, “If you love me, keep my commands…Whoever has my commands and keeps them is the one who loves me. The one who loves me will be loved by my Father, and I too will love them and show myself to them … Anyone who loves me will obey my teaching. My Father will love them, and we will come to them and make our home with them. Anyone who does not love me will not obey my teaching. These words you hear are not my own; they belong to the Father who sent me.” — John 14:15, 21, 23-24
The Lord meant what He said. Don’t expect to be able to stand under the coming pressure if you are living in disobedience to Him.
● In order to be obedient and demonstrate our love for Christ on a daily basis, we need to:
→ Submit completely
→ Resist continually
“Submit yourselves, then, to God. Resist the devil, and he will flee from you. Come near to God and he will come near to you.” — James 4:7-8a
As James emphatically points out, our walk with God involves two on-going commitments. One requires that we surrender our will, our fleshly desires, and our complete being to the Lord in an all-out display of loyalty and love. The other requires us to constantly fend off the attacks of the enemy, resisting his temptations to indulge in selfish pursuits and lusts. Whether we like it or not, doing battle with (resisting) the Devil is part of our calling in Christ. If we take spiritual warfare seriously – resisting Satan with the power and authority of God’s Word – while submitting to the Lord and loving Him with all our heart, there is no obstacle we cannot overcome. No matter what happens in the days ahead, trust in the Lord and follow the leading of the Holy Spirit. If you do, you will not go wrong.
Global Calendar of Events 2014 (One-World/Interfaith/New Age Movement)
Living for Christ in a Crisis Environment