The James Dicks Blog

Seems like this time last year all we heard about from our neighbors and the evening news was the problems associated with the U.S. housing market and how would we ever be able to cope. Well, the mortgage/housing talk seems to have died down but the situation still exists and the question of how we might cope with this problem is still very real.

Sure, foreclosures seemed to have relaxed a bit but there’s probably a very good reason for that – stalling tactics by homeowners. When the economy crumbed, people started losing their jobs, and the payments stopped on homes around the nation and the population had to think fast. Many decided the best way to temporarily weather the mortgage storm was to stall as long as possible. So, although they were unaccustomed to doing so, many Americans “lawyered up” and put their faith in legal stalling tactics. Up to now it’s worked like a charm. It’s helped people remain in their homes while they desperately search for employment to support their families. It’s also helped the government economic figures. But don’t let the fewer number of foreclosures around the nation fool you. They are not gone; they’ve just been postponed for a few months.

Unemployment continues to rise or remain at constant levels in many states and that just isn’t helping those in need of finding ways to start paying for their homes again. In Nevada, for instance, unemployment hit 14 percent. Those figures have put Nevada 4.3 percentage points above the national unemployment rate of 9.7 percent, and 0.4 point above Michigan’s 13.6 percent rate. By the way, Nevada also leads the country in foreclosures, bankruptcy filings and credit card delinquency. This is just one state’s economic situation; you can find basically the same kind of miserable numbers in Michigan, California and Florida.

There are tons of people out there grabbing up foreclosure deals like mad but the sales are rather slow for a number of reasons. Few people have the money, the credit rating or the desire to be purchasing their next dream home. Banks aren’t lending either and that’s a problem. There is an excess of worry and concern about where families will be in 6 months or a year. Empty homes are fostering vandalism and neighborhoods that were thriving a couple years ago are now quickly falling into ruin and even the homes that are occupied are losing value almost daily.

The government recently reported that new home sales in the United States plunged 33 percent in April to a seasonally adjusted annual rate of 300,000 units. And it was also released that more than half of all homeowners with modified mortgages fell at least two months behind in their payments just a year after the adjustment was made.

In recent months, the possibility of foreclosures continued to fester and that might be a good indication why the media hasn’t reported on it as effectively as they once did. Maybe they’re bored with this persistent problem. Glancing over the headlines on a major news reporting source this morning shows stories about a Sarah Palin public appearance, the problems with the new iPhone, a union that is apparently angry at the governor of Arizona, and the one year anniversary of the deaths of Michael Jackson and Farrah Fawcett. Not one story about the current problems with the banking industry and the housing sector.

So, it’s on to the daily accounts of the Gulf of Mexico BP oil spill (at least for now), but be advised that the housing predicament still exists and is about to grab the American economy by the throat (again). And I’m just referring to the residential side of the Real Estate market; I haven’t even addressed the commercial side yet.

So, where did the mortgage problem go? It didn’t go anywhere, my friend. As a matter of fact just look next door or across the street and I’m sure you’ll find it. Wonder if your representative in Washington sees the same thing in their neighborhood? Maybe it’s time to write them and find out.

JamesDicks General business, credit, delinquency, Dicks, economy, foreclosure, government, homes, housing, James, money, mortgage, real estate, unemployment, washington

You’ve heard the old saying, “it’s not what you make; it’s what you keep.” That has never been truer than in today’s very weak economic situation. Everyone has had to change their lifestyle – no matter how much money they are making. I know ”millionaires” who have to change their personal financial habits. It’s tough al over and families have redirected their priorities because of the money question.

So, what’s the answer? One phrase, “spend less – save more.” It’s time to design a very positive approach to actually changing your habits and develop individual goals. This kind of action will better secure your success in obtaining meaningful returns through an actual meaningful reorganization of your financial life. A recent government report showed that Americans cut their spending and saved more for a sixth straight month as more and more people were either worried about finding a job or keeping a job.

Goal setting is another top priority. Determine specific and attainable goals, short and long term, and make sure you write them down. Physically writing them down gives them power. The act of writing and visualizing your goals makes it much more likely that you will actually achieve them.

You must also understand your current financial situation to know where to make your changes. Add up your assets and your liabilities. Find out how much you owe on your home, your cars and your credit cards and conclude how best to shape and maybe cut those liabilities down a bit during the year ahead. It’s always a good idea to get rid of debt, especially high interest debt. You might also consider establishing new insurance needs. Examine the validity of your current life, disability, home, health or auto policies and decide whether changes are required. If you’re like the rest of us, you probably haven’t looked at your policies in quite some time.

Again, the best way to establish a solid financial plan is to save, save, save. The general rule is to put away 5 percent to 10 percent of your take-home pay, if you can. Remember to pay yourself first and don’t wait for what’s left over after you pay your bills. If that’s your strategy, you’ll find it difficult to save anything. You should also be sure to set aside your savings in an interest-bearing account, such as a money market account, or in a tax-deferred account like an individual retirement plan (IRA). If your company offers a 401(k) plan, start contributing as soon as you possibly can, especially if the company matches your contributions. Once you’ve finished the basics, then you can start examining your portfolio and other investment opportunities.

Something else to pay close attention to, especially during this time of the year, is your tax strategy. When you receive your annual W-2s, make sure your monthly tax payments are being deducted at the proper level. The trick is to come as close to breaking even as possible on your federal tax returns. You should keep and invest your money throughout the year rather than allow the government to use your hard-earned cash.

Remember, it doesn’t matter how old or young you are, or how much money you’re making; now is the time to start improving your financial situation. There are a lot of important events in our lives that rely on our financial health – education, weddings, vacations, security, and retirement just to name a few. These times are tough, there’s no doubt about it, but we all must start to rebuild what we have lost and set goals to get back to where we want to be. It’s important and the sooner you start the sooner things will start to improve for you and your family.

JamesDicks General credit, credit cards, crisis, economy, education, financial responsibility, forex, goals, government, investing, james dicks, money

Well, here we go again. April 15 is right around the corner which means it’s time to get your 2009 income tax done. Hopefully you’ve been working on your documentation throughout the past year but if you’re like most people, you only begin when you have to begin – which means you’re probably scrambling today. So, between now and April 15, I want to present you with some information that just may help your planning as you prepare to accurately fill in the blanks on your 2009 tax forms.

First, I urge everyone to use the long form when filing your return. One of the key errors made by people who pay too much in their annual tax bill is that they ultimately decide that the amount of time spent each year preparing their tax returns is more important than saving money for themselves and their families. They may not be consciously doing so but that is exactly what is happening. Our American society always seems to believe that faster is always better and for many events, that’s true. But, that may not be true when it comes to your tax strategy. The IRS gives precise guidance to those who are considering using the “EZ” form and the IRS website gives strict guidance to those who are considering using this form (www.irs.gov/taxtopics/tc352.html).

It’s very common for those using the “EZ” form to leave money “on the table,” whether directly or indirectly. When the IRS developed the short forms (1040A and 1040EZ), they did so as a method of making it easier for you to easily complete what most people consider a complicated task. Now I’m not a conspiracy theorist but I’m also not totally convinced that this was the real reason for creating these short forms. Rather I believe it was a masterful method of cutting back on the number of deductions that could be claimed each year against the government’s balance sheet.

I can’t deny that these forms are much easier to complete for those who fit the profile; but by doing so they end up paying the maximum amount of tax possible at particular income level. When an individual fills out the 1040 long form, they also open up all possible deductions that are available. The first time an individual fills out a long form, they usually quickly see the various deductions that they can’t take and this lesson will give them an opportunity to see where their tax planning might be lacking. One thing is for sure, you never pay more in taxes by using the long form. Once you become familiar with deductions that might be available to you, you will always pay less.

I would always recommend you take advantage of the knowledge of a tax professional, whenever possible. I’ll discuss that in my next article. But a professional will probably not miss the possible deductions that fit your personal situation. The IRS keeps track of the deductions that are most frequently overlooked by taxpayers and if you are a novice in developing an effective tax reduction strategy, then you’re probably completely unfamiliar with the numerous deductable opportunities that actually exist. A tax professional is constantly learning about the most current changes to the tax code and is, no doubt, up-to-date when it comes to the ever-changing tax laws.

By the way, the tax laws are still being developed for the 2009 reporting year because so many things have changed along with the new government in power in Washington DC. The stimulus package, the housing market, the Haitian disaster, and the rules of what is taxable and nontaxable as it pertains to unemployment benefits, have all contributed to creating questions in this year’s tax law. The estate-tax law is still out, and there have been reports that things have changed so much, so fast, that some of the forms needed aren’t even ready yet. This is going to be a very interesting tax season. Just make sure you’re prepared, learn all you can and make sure you are within the standards set forth by the tax code. Do it right the first time and meet all the deadlines on time but also make sure that you take advantage of every deduction you are qualified to take.

JamesDicks General 1040A, 1040EZ, April 15, deductions, forex, internal revenue serivce, irs, james dicks, money, premieretrade, tax code, taxable income, taxes

This may be a little off topic from most of my blogs, but after watching the most disturbing investigative news report I have seen in a long time, there was no way I was going to bed without writing about it. The story was on 20/20 last Friday night on ABC. It was about young children going to the dentist and being subjected to the most traumatic experiences you could ever imagine. The videos that they showed in this report were shocking, unacceptable and you can bet I will be with my kids next time they visit the dentist. These young kids were having in some cases up to 16 root canals in one sitting, the dentist turning up the radio so parents couldn’t hear them screaming, putting the kids on a restraining board so they couldn’t move while still carry out these procedures until the kids were beyond hysteria. I can hardly even write about it.

I will let you, if you dare, go to You Tube and search the 20/20 Small Smiles story which aired Friday night January 22, 2009. The clinic that the story focused on was called Small Smiles with locations all over the country. Apparently they just settled with the Justice department this week for $24 million, and have had numerous other settlements.

Let me share a dentist story with you that happened to me. I went to a dentist many years ago, the dentist told me I had 8 cavities and that I needed them filled. I can tell you one thing; this Marine doesn’t like going to the dentist or at least their practice. So I put the procedure off and told them I would be back later. I’m glad I did that because I went to a different dentist for a second opinion and, guess what, I had no cavities. This dentist was about to start drilling for no reason at all and worse yet, I had family members that weren’t as lucky as me and ended up getting the drill from this dentist, who ultimately lost his license.

So back to your kids; do not under any circumstance let your kids go back with the dentist without you. And if the dentist won’t allow you to go back, then FIND A NEW DENTIST! If you can’t bear to watch then something must be wrong. If all else fails get a second opinion. I am sorry if this is harsh or hard to read, especially if you are a parent of young kids like I am. But as I said in the beginning, no way was I going to sleep after seeing that report. Protect your children and their teeth.

All my best

James

JamesDicks General business, children, credit cards, dental, education, expenses, investing, james dicks, money, success,  financial responsibility,  forex

I don’t know about you but, so far, this year has been very busy for me. Dealing with the current state of the economy, politics, trying to understand the new paradigm of American commerce, more politics, the housing dilemma, stocks go up big…then go down big, more politics…well, you get the message. From the moment we wake up in the morning until the time we go to bed at night, there seems to be some kind of controversy going on and, frankly, it’s getting tiresome. We struggle daily to make more money so we can buy more things and many times it appears that our 20th Century pursuit for a life of personal happiness and material comfort has become a real chore for us in the 21st Century.

Traditionally, Americans have tried to attain what became known as the American Dream through hard work and cautiousness as it pertained to their personal finances. This approach helped our grandfathers develop a solid financial foundation that insured a comfortable life and a tranquil retirement. But in the past few decades those values have been pushed to the sidelines in favor of a “get it now” financial attitude tied to a “get rich quick” philosophy. Our population seems to be constantly searching for instant riches through state sponsored lotteries, game shows, pro sports, show business or litigation. Many psychologists actually believe that the idea of quick riches has served to deteriorate our traditional American work ethic.

A few decades ago, the vision of the American Dream was essentially universal. You attained it by earning and saving enough money for an education for yourself and your children, a home in the suburbs, a dependable car, through a first-rate job to sustain the dream. But today it’s different for each one of us – today the dream is how you personally define it. For many of you, trading is a method of attaining the dream but remember that trading is not a get rich quick scheme but rather a technique of adding to your personal wealth in a methodic manner.

Trading will allow you to adjust your personal prosperity at your own pace based exclusively on your own parameters – things like risk tolerance and your specific financial goals. But never doubt that you will have to work industriously and deliberately in order to excel in your trading. It takes some planning, some preparation and some education. It also takes a calculated work ethic to attain a positive end result. There is no “get rich quick” plan – it’s going to take some time and you have to be prepared to expend the energy necessary to attain a successful final outcome. A winning trading experience represents how Americans used to reach for the dream – with a determined and unwavering resolve while developing a sense of self-reliance and confidence in their plan.

Ideally, we might all feel more secure and content if we could go back in time and live a less complicated life but that’s not going to happen. It is time to develop a new principled strategy that will insure growth in the short-term and in the long-term.

Today, American society seems to be extremely focused on the intrinsic power of the almighty dollar and, many times, totally discount the joy we can find in our lives for reasons other than material gain. We should remember that while money is an important aspect of life, it certainly isn’t something that genuinely brings joy – you can have lots of money and be totally miserable. I believe it’s time for us all to redirect our attention and values to the things that are truly important in life in an effort to not just attain, but enjoy, our personal American Dreams.

JamesDicks General american dream, economy, forex, goals, housing, investing, james dicks, money, personal finance, politics, premieretrade, stocks, trading