The James Dicks Blog

Welcome back.

Follow up to previous blog post.

Once you have actually seen yourself spending and enjoying your newfound financial success, you can move on. Please don’t fudge—OK, let’s move on together. Let’s change your visual focus. Where do you live in your new life of prosperity? What does your house look like? How many bedrooms does it have? Can you see it? If you can see it, spend a few minutes creating details. If you can’t see it, spend a little more time with the exercise until you can.

Someone once said that what the mind can see, the body can achieve. I believe it. I go a step further. I believe that the mind must see it before the body is able to work for it. Look at another realm of human endeavor: sports. When Roger Bannister broke the four-minute mile, he saw it long before he did it. Over and over in his mind, he later recalled, he visualized doing what had been deemed to be impossible. Interestingly enough, once Bannister did what no one else had ever done before, others quickly succeeded in doing it. Why? Because in minds all around the world, mental barriers had been broken. People understood that the impossible was now possible.

The same analogy applies to wealth creation. There is a process one must go through to achieve it. Bill Gates, in his best-selling book The Road Ahead, writes about his “play” with computers in high school. Even then, when computers were the size of large rooms and far less powerful than our miniature hand-held PDAs, he dreamed about what they would be able to achieve in the future.

His dream was so strong, in fact, that he feared missing out on the revolution he saw in his mind. He dropped out of Harvard University—dropped off the safe path he was on—to get a quicker start. There was simply no way that he was going to let the software revolution start without him.
Bill Gates saw the future of computers in his mind long before it became a reality. He saw a role for himself in that future. He dreamed the dream, developed plans to fulfill that dream, and then took action. This could be called the “science of success.”

It’s not restricted to Roger Bannister and Bill Gates. It’s something that each of you can participate in and benefit from. But before you can do it, you have to knock down the mental barriers to your financial success. You must learn to envision your achievements. Once you do, the achievements will follow. So far, so good? Are you beginning to see the mindset you need to have if you are to achieve financial freedom? Let’s go a little further.

What about a family? Will you have a spouse? Children? What will they be like? These are extremely important thoughts to consider and plan for. You must see it before it happens, but once you do; financial freedom will be more than one step closer.

All of the questions I have posed to you so far will become an important part of creating your dreams and ultimately achieving goals based on those dreams. Now that you see the process unfolding, you can also see how the end results will be different for everyone.

More to follow don’t miss reading the most important aspect of how this exercise can make such an impact on your financial life.

My Best
James Dicks

The unemployment rate is currently at the highest level since the early 1980s. Losing a job is a horrible experience even in the best of economic times, but when the global economy is as volatile as it is today, it can be devastating. So it would be wise, if you haven’t done so already, to plan for the worst while hoping it doesn’t happen. Develop a personal financial survival plan that will help you over the rough spots should the unthinkable happen.

The financial experts always say you should have six months worth of salary set aside as a buffer but putting that kind of nest egg together is sometimes easier said than done. So look at the problem with a different perspective. Create a budget of all your “necessary” monthly expenditures; and by necessary I don’t mean that subscription to HBO or the two dinners a week you eat at your favorite nightspot. I mean really take your personal budget down to the bone and then figure your monthly expenses. My grandfather used to ask me, “Do you want it or do you need it?” That’s the kind of gauge you have to use in this kind of situation. I think you’ll be surprised at just how little you can actually live on each month when you compare it to what you’re spending today just by eliminating all the extras you spend every month.

If you have credit cards with a balance, you should call the bank and see if they will give you a better deal on the interest rate. This has become a very competitive business and if you ask them to lower your rate, they just might do so. One thing is certain – if you don’t ask them they will never lower your rate.

Make sure you have all your documents available and ready should you need them. This should be part of your normal routine but most of us don’t get things in order until someone actually asks us to present a copy of something. Then we madly start looking through what we thought was an organized system only to find the document we are looking for isn’t there. So, get your paperwork together; things like bank statements, past year(s) tax returns, passports, and insurance documents. You might even consider putting these important documents in a fireproof box that can be grabbed and taken with you in case of emergencies. And consider putting a stash of cash in the box too…just in case.

In anticipation of the worst, you might also consider creating a secondary source of income, whether it’s starting your own home-based business or working part time for someone else. If you have extra income coming in prior to an emergency situation, you’ll be better prepared when or if something does actually happen. Maybe you have a talent or a hobby that you can use to create an extra income source. What about a course you can take to learn a new skill? There are a number of things you can do to generate extra cash flow; start investigating them before you need to.

Finally, one of the greatest things you can do for yourself is to keep moving forward, with a smile on your face and your head held high. Get comfortable in developing your networking skills because in today’s world, this is a requirement. Don’t fall into the “out of sight, out of mind” syndrome but rather maintain a solid image and a well-defined approach when engaging people within your area of expertise. Whenever possible make connections with others who may be able to help you. Go out and keep shaking hands, make phone calls, send emails…never allow yourself to fall by the wayside. Just go where the people are and use all types of media to meet them. This can go a long way in helping you to maintain a solid footing during the rough times and just might assist you in locating that next big career move.

The bottom line – in order to make sure you move through this unpredictable economy successfully you must be well prepared. Arrange your life so that when (or if) something unexpected should happen, you’ll be ready for it while you smoothly “sail through” to your next big opportunity.

The main topic of conversation for the past 18 months or so has been all about the economy and how we’ll be able to cope with it today and into our retirement years. Most of us have had a certain amount of fear invade our once serene financial lives and today just about anything will set off our emotional release when it comes to the sensitive topic of – “what happens next?” – as it pertains to our personal financial situation. It has been a very tough year and although government figures are pointing to a recovery on the horizon, I don’t really know many who will attest to the fact that things are really beginning to improve on their economic front….at least not yet.

But there are a few things that you can do to help the situation while the years ahead try to mend the financial damage that we’ve experienced recently. The first thing, and probably the most important, is not to ignore your current situation. Listen, I know that many of you have not been checking out your banking or investment statements lately because you just don’t want to see that bottom line figure. The fact remains, unless you know what that figure is, you won’t know where you’ll need to start the repair or how aggressive you’ll have to be to fix the problem. So, stop hiding and take a look. You might not like what you see but at least you’ll know where you stand and that will be the beginning of “fixing what has been broken.”

If you haven’t done so already, find an accountant. There have been so many changes to the tax laws in the past year and even the professionals are overly challenged when trying to keep up with the latest tax modifications. Many of you have started your own businesses this past year and if you try to mix that with your personal taxes, well, you could be in for an ordeal that might lead to errors in your final tax figures. So, let someone who knows how to handle the situation do it for you. Sure, it’s going to cost you a few dollars but in the end you’ll be more at ease and content that you did it the right way and, believe me, that will be well worth a few extra dollars.

In the computer age, you can automate many of your financial responsibilities that in the past you would normally worry about. Things like automatic bill pay through your bank’s website or payroll deductions to your 401(k) plan or savings accounts can do much to take some of the pressure off. You can also have your utility companies or a personal credit card simply debit your account on a monthly basis and you won’t ever have to worry about late fees. But even better than that, since you won’t have to actually sit down and pay the bills, you’ll have a lot of extra time to do the things you really want to do.

As we approach 2010, use some of your extra time to sit down and write your goals for the New Year. What did you want to accomplish this year that you didn’t? What would you like to achieve next year? Maybe it’s that vacation you’ve always wanted to take to Paris or finally finishing your education; whatever your goals are, just make sure you write them down and post them someplace. Ask yourself where you see yourself in five years. Then, prioritize those goals to figure out a way to make them happen. Once you’ve set your personal goals, make sure you stay focused and remain on course to complete them successfully. Constantly review and update your list of goals and modify them to reflect any life changes, experiences or priorities. If you want to make something happen you must set and manage your goals. Make that a priority this year.

If you are dedicated to creating a booming year ahead, you must make sure that you look at everything with a new point of view. If you’ve been doing things in a certain manner that hasn’t really been working out for you, the only way to change the outcome is by changing how you deal with the problem. Make something happen in the coming year by producing a positive environment that will allow you to realize the success you are striving to achieve.

We are approaching the final quarter of the year and I just want to remind you about something that I consider a very important aspect of any well-balanced financial life.  Make sure that you accomplish frequent financial checkups to ensure that you are on the proper path to develop your assets effectively.  Situations can change very quickly in life and you must consider, on a regular basis, the composition and structure of your personal financial goals, tools and investments.  There are many issues to consider.  Things like getting rid of unnecessary debt, developing proper spending habits, checking your insurance needs, examining your taxes, and determining whether or not you need to rebalance your portfolio. I’m sure you could come up with a number of other areas that, on a personal level, will positively or negatively affect your financial life.  Check it all.

There are numerous methods of determining the best methods of handling our money that didn’t exist a decade ago.  Most of us have personal computers at home that can be used to assist your financial development.  There are many software programs that can help guide you by showing where your money is currently going.  These programs can help you determine the best methods of using your cash to enhance your investments.  Determine how much is coming in, how much is going out and establish where the money is going.  It’s really that easy.  Once you know those facts, you can make your adjustments.

One question that you really should ask yourself is whether the investment methods you use are actually working for you to build financial wealth.  If there have been problems, changes in the market trends, an alteration in your personal lifestyle (a new baby, a recent move, a new job, you’ve just married, just divorced) then make the necessary changes to make sure your money is working to fit your life’s changes and goals.  Interest rates are down today and it may be time to consider refinancing your home but only you know whether that’s something you should do or not.  Plus, make sure you build at least three to six months worth of living expenses, if you don’t already have that amount put away safely. 

Other areas of interest to your personal financial life include your insurance coverage.  If your agent hasn’t called you recently, pick up the phone and dial your agent’s office and request that you take an inventory of your coverage (home, life, auto) and adjust where needed.  For goodness sake, examine your credit report at least once a year.  It might be a good idea to actually contact the credit agencies twice a year, especially if you are about to make a major purchase.  

Just as you need to develop and then redevelop your short and long term goals throughout the year, so it goes with the state of your financial well-being.  This should not be an unpleasant chore but rather something enjoyable.  Remember, by conducting these occasional checkups, you are insuring that positive financial results are more likely to be attained. 

Anything can happen throughout the year (as this year has shown), which can force you off your fiscal course.  Events that can make a difference in your life occur at a moment’s notice.  Just make sure that when unforeseen events occur, you make the needed corrections that will rebalance your financial life.  Plan to make a quick check every three months or so.  This is all part of goal setting that I believe is so important to leading a balanced and prosperous life.  Stay focused and make sure you perform your personal checkups on a regular basis. 

I’ve noticed recently that we seem to be worrying about everything.  Yes, the past year has been tough on a lot of people and a lot of businesses. We agonize about the current state of the economy, we are concerned about the horrific possibility of terrorism in our local communities, we worry about whether we’ll be ready for retirement, and we are very concerned about how our children will fair in this highly demanding and , at times, difficult world. 

I usually find that if I’m not certain of where I’m going or how I’m getting there, I will tend to have more concerns than if I actively sit down and plan for the future.  We hear on the financial news programs every day that investors are “worried” about a variety of things that will move the markets lower.  What’s the point?!  Let’s start planning our personal situations and stop creating the anxiety.  The summer months are over and we are now preparing for autumn and the changing colors of the trees, feeling a nip in the air, and the smells of the season from cinnamon to evergreen.  I don’t know about you but I think this is a great time of year.  

Sure, there are some challenges ahead which could complicate our national and personal finances.  The negative scenarios that the U.S. economy is pushing through today along with the ever-increasing cost of energy could certainly cause a drain on our personal finances and put tension on the retail sector as well as pressuring the trade gap.  But there’s not a lot we can do personally to generate solutions for these hot topics.  The one thing we can do to sustain our personal “corner of the world” is to develop a positive and constructive attitude.  It really does help.  When you decide to carve out your personal path using even a small amount of confidence, you can’t help but develop the belief that you can succeed at anything you set out to do, no matter what the odds.  Believe me, I’ve done it. 

Positive thoughts and actions create positive results. If you have the wrong attitude then your trading could also be affected.  Doing anything with the wrong attitude will lead you in a direction that will be a burden rather than a blessing.  Individually, things can be tough to deal with but collectively – as an encouraging population – we can do anything.  As we approach the final quarter of the year, I’m hopeful for the months ahead and I hope you are too.  We’ve proven this factor in the past and I have no doubt that we will bear it out again in the future. Become proactive and cheerful by developing your attainable goals while staying focused on the situation(s) at hand.

The improvement of anything you do in life requires you to get the education you need, whether formal or informal.  If you feel like you need to improve your personal investing skills why not find a trading group in your local area and work with others to perfect your skills or take a formal class.  You’ve heard me say it before – it’s all about education.  If you are learning to play golf, I’m sure you have to practice.  If you are trying to master algebra, you have to study.  The same is true for an effective and profitable financial life.  Never give up! Determine your direction, get educated and you will get results! 

Happy trading!