The Doomsday Scenario thread by Mark24609, and specifically the zombie comment by brewer1234 got me thinking. Mark's 'doomsday' scenario was really about a not entirely unheard of market downturn. Not really a doomsday and nothing that the various retirement calculators don't account for. A conservative withdrawal rate would survive just fine. Some people go ultra-conservative on their withdrawal rates, thinking that the future may be worse than any series thus far experienced in the past. Possible, but I feel like if that really happens, then it may well be coupled with some serious disaster, nuclear war, coronal mass ejection solar storm, pandemic... zombies, etc. Whatever it is it would have to be something worse than anything the US has experienced so far in its history. In that scenario it doesn't really matter what your withdrawal rate or allocation of bonds to stocks is, because electronic and paper money might not be worth anything. The banks might not be solvent, or have closed their doors, or have been atomized by Tsar Bomba. Good luck making your retirement account withdrawal when the electricity on the entire eastern seaboard for 3 months. Were Parisian retirees able to make retirement account withdrawals in 1941?
This isn't a new idea, it's what all those 'preppers' out there are on about. I'm sure we've got some preppers here who can chime in.
So how does one try to ameliorate risk in this type of scenario? My first inclination is to own some rural land so that when SHTF you bug out there and begin your new life as a subsistence farmer. I've heard stories of billionaires doing the likes of this, buying 100's or 1000's of acres and building bug out bunkers or compounds, but I imagine you wouldn't need 100's of acres to self-sustain. This could also maybe serve as a cabin in the woods for the family or something too.
My question is about how such rural and/or agricultural land performs as an asset class. I feel like when people here talk about owning Real Estate as an asset class they usually are talking about property in cities, or burbs, or in vacation spots like some lakefront or something, but maybe that assumption isn't correct. Do rural properties tend to appreciate as well as urban and suburban properties? (Do we have any REIT fund managers on here? I'm sure they could answer.) If so they seem like an attractive option as they can provide growth long-term during non-doomsday, but also serve double duty as a doomsday backup. I guess the downside being that you can't siphon off any of that value until you sell the property, so you can't make withdrawals from that stash, meaning your asset allocation to that class would get heavier over time.
I actually have lots more questions about such a property, but will keep to the main question about returns for now. I think it's an interesting idea, I could get into the whole prepper thing.
This isn't a new idea, it's what all those 'preppers' out there are on about. I'm sure we've got some preppers here who can chime in.
So how does one try to ameliorate risk in this type of scenario? My first inclination is to own some rural land so that when SHTF you bug out there and begin your new life as a subsistence farmer. I've heard stories of billionaires doing the likes of this, buying 100's or 1000's of acres and building bug out bunkers or compounds, but I imagine you wouldn't need 100's of acres to self-sustain. This could also maybe serve as a cabin in the woods for the family or something too.
My question is about how such rural and/or agricultural land performs as an asset class. I feel like when people here talk about owning Real Estate as an asset class they usually are talking about property in cities, or burbs, or in vacation spots like some lakefront or something, but maybe that assumption isn't correct. Do rural properties tend to appreciate as well as urban and suburban properties? (Do we have any REIT fund managers on here? I'm sure they could answer.) If so they seem like an attractive option as they can provide growth long-term during non-doomsday, but also serve double duty as a doomsday backup. I guess the downside being that you can't siphon off any of that value until you sell the property, so you can't make withdrawals from that stash, meaning your asset allocation to that class would get heavier over time.
I actually have lots more questions about such a property, but will keep to the main question about returns for now. I think it's an interesting idea, I could get into the whole prepper thing.