Six tips to thrive (not just survive) tough economic times

With housing at 10-year lows … stocks languishing in a bear market … U.S. inflation at 26-year highs … the U.S. dollar flirting with all time lows … and the economy stuck somewhere between a recession and inflation ... Americans are now feeling the pinch!

At the root of today's energy and inflation crisis lies a weak dollar, despite gov't policy to the contrary. The old saying used to be; "as sound as a dollar", but today its; "as soft as a dollar".

The dollar has served as the world’s reserve currency for more than 60 years, but never in history has the guardian of the world's reserve currency also been the world's biggest debtor. Those who've placed 100% faith in dollar-denominated assets still need a life jacket.

"Clinging to cash in this environment is akin to trying to tread water holding a boulder. Trying to weather the upcoming storm holding cash you’ll find yourself with ashes slipping through your fingers," reports MidasLetter.

The gradual devaluation of the dollar during the 20th century reflects a more subtle transformation. Americans have abandoned the morality and sound economics of our Founding Fathers, who defined a "dollar" as a weight-measurement of gold or silver.

Honest money, our Founders reasoned, must have four basic characteristics: 1) Scarcity 2) Portability 3) Divisibility, and 4) Dependability as a Store of Value. (Dollar fails #4).

"The dollar is slowly becoming an I-O-U nothing," former Fed economist John Exter once said. Why? Because true money must be derived from a commodity, or it will eventually become fraudulent money.

True wealth is not measured only in dollars, but also in our contentment level, our relationships and our legacy to the next generation. True wealth is not measured by the abundance of 'things', but by the fewness of our wants and willingness to sacrifice. Americans often go ‘back to basics’ in hard times. We also begin thinking longer term.

Six tips to help you make smarter choices with your time, energy and money to thrive during tough times ahead.

1. Spend less: Living within your means requires cutting unnecessary household expenses. Shopping at lower cost stores, like Walmart or thrift stores and shunning the temptation to buy on credit. From what I can see here in Phoenix, the fasting growing department stores are new Goodwill outlets. Embrace thriftiness rather than indebtedness.

2. Earn more: Although now is not a great time to change jobs, it may be a great time to launch a new family business. Opportunities to work from home on the Internet are still out there without much training. Take an inventory of your skills and hobbies and consider developing a new business. Whether lawn care, babysitting, a neighborhood repair shop, or food co-op, the key is networking with family, friends and neighbors.

3. Sell stuff: With incomes not keeping up with rising expenses, many Americans have taken to cashing in their excess stuff to raise cash and help make ends meet via Ebay and Craiglist or having a good old fashioned yard/garage sale. This is a great way to generate increased household cash flow. Donate all the unsold items to your favorite charity.

4. Jewelry party: With precious metal prices tripling since 2001, home-based jewelry meltdown parties to recycle old gold and silver for profit are growing. These "Gold parties" can be fun and profitable idea. Bringing together friends, family and neighbors for a party is much more appealing to most than visiting a local pawn shop. Be sure to use the proceeds to reduce your debt first and then save at least 10% for emergencies.

5. IRA rollover: Now is a great time to convert some paper assets into precious metals without any tax penalties or new contributions, simply by converting an existing IRA, 401(k) or other retirement fund into a "Self-Directed Precious Metal IRA". This is a smart way to hedge a weak dollar and offset stock losses with virtually no money out of pocket.

6. Save real money: Put away at least $100 per week into precious metals for the long term. For example, if you save $400 a month in silver, over one year you’d have 250 ounces, (almost $5,000 at today’s price of $18/oz.). Experts say silver prices could rise to $50 to $100/oz. in the next five years. Imagine; over five years you'll have saved 1,250 ounces of silver, which would be worth $125,000 if silver reaches $100/oz. Hi-ho silver!

About 25% of Americans collect modern coins as a hobby, but sadly they are not likely to grow in value unless the coins are gold or silver, rather than today’s modern pop-metal coinage. Many of America's greatest coin collectors, like John J. Pitman started by slowly, but steadily putting away the best quality gold/silver coins they could afford.

Earn all you can, save all you can and give all you can is my best advice today. Putting away real or "good" money, whether gold or silver, will help offset bad times due to the falling dollar, rising inflation and the emerging debt and credit crisis of our time.