By Dr. Jill Ammon-Wexler,
http://www.quantum-self.com

Imagine each thought you think as a mental photograph.

When the thought is first exposed to your brain, very little happens. But as you expose your mind to that thought again and again, the thought begins to develop and hold an image in your mind’s eye just like an exposed photograph.

In fact, thoughts really ARE that powerful. Anything you focus on mentally DOES develop into a strong interconnected network of neurons. That network then holds that thought as an image. And your subconscious mind will then push you to take the actions that will bring that image into reality.

This is not theory — it is based on the research findings of modern neuroscience.

You need to be careful about your thoughts, judgments, and viewpoints. If you focus your mind on something you DON’T want — you actually strengthen the neural networks containing the image of that something.

That is why worrying about something actually drives you closer to that something. Worry is actually a very powerful form of negative goal setting. The more you worry about something, the stronger the neural networks containing your worries become. And the stronger those physical networks — the more likely your subconscious mind will drive you to take actions that actually push you toward what you’re worried about.

The Part Played by Emotion
The more emotion accompanying your worries, the stronger your neural networks will become. Emotion — whether positive or negative — is a neural supercharger. This includes stress — which is driven by emotion!

You’re getting the picture of the negative cycle that worry creates. The more worries, the more stress. The more stress, the less creative and clear your mind becomes. And the less creative you become, the less likely you will EVER solve the problem you’re worried about.

Plus the longer (and more passionately) you worry about something — the faster you are driven straight into the arms of what you’re worried about.

A Proven Solution
There is one, and only one, solution to this. You must step out of the stress/worry cycle, and direct your mental focus elsewhere.

What you focus on grows. This is why it’s so very important NOT to focus on your problems! You instead want to focus on creating positive solutions that create something you DO want.

Here’s a plan of action:
* Convert your problems to goals,
* Create a detailed goal-plan,
* Break your goal-plan into the smallest possible daily steps, then …
* Begin to take action — one step at a time.

And in the meantime:
1. Refuse to worry. Remember — worry is a very powerful form of negative goal setting.

2. Create a new mental image. Create and hold a mental image of how life will be when you reach your goal. The more emotion you pack into that positive image, and the more often you put your mental focus on it, the stronger the neural networks holding that image will become.

3. Bust your stress. Unless you manage your stress, it will continue to build “negative neural networks. Don’t kid yourself about stress — it is at the core of many serious life-threatening bodily conditions, and has a way of “pretending not to be there.” Brainwave training is the fastest answer to instant stress reduction.

4. Build your self-confidence. Take some steps to build your self confidence. A huge medical study showed that low self confidence and negative thoughts cause your brain to physically shrink as much as 20%. Self confidence is not a lightweight issue — it places unrealistic limits on your entire life!

5. Take care of your physical self. It can be easy to just take your mental and physical health for granted until something happens. Simple dehydration equal to two glasses of water, for example, has been shown to reduce your mental performance as much as 50%. Add a walk and 20-minute workout to your life, and you’ll start to produce more feel-good brain neurotransmitters.

6. Grow your mind power. Your brain truly follows the same rule as your muscles — use it, or lose it! And today’s scientific evidence is that your brain is either growing, or it’s physically shrinking.

Dr Jill’s “Take Charge” ecourse guides you step-by-step into amazing mental expansion. Join thousands of success-seekers worldwide — get straight to the core of your personal power and claim lasting success and achievement. For more information go to: Quantum-Self

Do you know the investing strategy that separates the men from the boys – the women from the girls?

It’s doing the things that are “uncomfortable”!

In this case, it’s stepping up to the plate and investing in a prudent balanced fashion (as per your RRSP investment plan) when it seems that everyone around is cowering under their bed covers…

It’s that simple – yet that powerful.

Why?

Because you are employing a “telescopic view” on your financial world – not a “microscopic view”…

It’s this formula that makes for real wealth creation!

I am reminded of the short but memorable time that I got to spend with Sir John Templeton in the Bahamas over 15 years ago. I have included my recollections of that conversation at the end of this post.

While it’s always a good thing to be putting money aside into your RRSPs each year – this time – this year – it’s even better!

I realize that it may seem tempting to put off contributing to your RRSP account when you have just finished watching the evening news on television or read the morning paper.

However, with all the doom and gloom talk abounding, it’s time to look at the other side of the coin.

Remember: there are always two sides to a story…and in this case the media has been overzealous in its portrayal of the economic slowdown as being just short of the Apocalypse.

(On a side note: In a new poll, Opinion Research Corporation found that 77% of Americans feel the media are making the economic situation worse by feeding consumers a constant diet of bad news.

Survey respondents said the negative news reports are eroding consumer confidence and deterring investment. One lawyer has even suggested that the media should be exposed to legal action for its alleged role in further depressing the economy.)

Now, let’s look at the positive aspects that economic slowdowns can and do bring!

Tough economic slowdowns mean the shrinking of the economy, it can and does bring with it many benefits to the everyday person and family.

Economic slowdowns can be a good thing!

Yes, economic slowdowns offer great opportunity for those who prepared for this eventuality. However, the vast majority unfortunately never ever prepare.

This is the precise reason why the prepared few find the vast opportunities! The action takers!

Who benefits the most from a recession? The Buyers!

Why?

Because it puts fiscal responsibility back on the top of the list.

Here Are 6 Reasons Why Economic Slowdowns Can Be A Good Thing

1. Value Stocks are Plentiful – With recession comes fear in the markets. The human emotion of fear is usually a bad thing for the stock market except if you are a buyer! With strong stocks trading at historically low prices, it can be a field day for investors who have cash. And that is exactly where we are right now – cash at “RRSP season” looking for a home to be invested in!

2. Real Estate Buyers Market – If you are fortunate enough to be in the market for a home, then there is no better time to buy real estate than during a recession! With fewer buyers out there, houses are sitting on the market a little longer. This creates much stronger motivations in the seller which typically results in lower house prices.

3. Cheaper to Borrow – A slower economy typically means that the central banks jump in and lower interest rates in an attempt to encourage spending – and that’s what we are seeing right now! Lower rates means lower debt servicing payments such as mortgages and investment loans. This is another reason why it’s a great time to be a home buyer – or embark on a prudent “borrow to invest” program!

4. Retail items are cheaper – With retail sales slower due to consumers cutting their discretionary spending, retailers try to boost their sales by slashing prices. It’s a great time to buy items that you have been saving up for – at a greatly reduced prices!

5. Gas is cheaper – With a global slowdown, there is typically a lower demand for oil which in turn translates into lower oil prices. As oil and gas prices usually go hand in hand, a recession means that gasoline prices are reduced.

6. It’s Vacation Time – Lower gas prices along with less people
spending money on luxuries (like travel), makes it a perfect opportunity for a lower cost vacation. Airline tickets, hotel stays and even car rentals are all reduced in price.

Want an example?

My wife just left for 1 week vacation close to Cancun, Mexico… I stayed behind because of “RRSP season” and to service those who always wait until the last minute. (Don’t make me regret not going on vacation with her! )

When it comes to your RRSP investing this year – stick to the plan!

Most millionaires are made because they have positioned themselves for times like today. Remember, the greatest fortunes are begun in times of “greatest despair”…

It is the financially savvy who can take advantage of these opportunities when they come along – and they do with some regularity! For after every excess – there is a cooling off period before the cycle begins again…

Therefore, I truly believe economic slowdowns give the little guys an opportunity to catch up with the big guys if they play their cards right.

And that’s the message that I have always subscribed to and will continue to believe.

Why?

Because history bears this out!

Now, here’s what to do: Do not wait for a change of environment before you act – begin changing your environment by acting today!

Don’t forget that you are going to be spending the rest of your life in your future – what kind of future is it going to be?

Will it be one that feels like “hell on earth” or one that is all and more than you had imagined in your wildest dreams!

So it all comes down to this…

Will your RRSP investment actions be microscopic or telescopic?

When it comes to your RRSP investing this year – stick to the plan!

Now, “be a man” – or “woman” – step up to the plate and “do the right thing”!

My recollections of that conversation over 15 years ago with the late great Sir John Templeton…
http://www.howtobesetforlife.com/articles/the-wisdom-of-sir-john-templeton/

The following advice is over 500 years old!

It comes from one of the original value investors and yet the advice is as relevant today, as it was over 500 years ago.

“Divide your fortune into four equal parts: stocks, real estate, bonds and gold coins. Be prepared to lose on one of them most of the time.

During inflation, you will lose on bonds and win on gold and real estate: during deflation, you lose on real estate and win on bonds, while your stocks will see you through both periods, though in a
mixed fashion.

Whenever performance differences cause a major imbalance, rebalance your fortunes back to the four equal parts.” – Jacob Fugger the Rich, 1459-1525

Now listen to the words of the words of the wealthiest man on the planet: “To invest successfully over a lifetime does not require a stratospheric IQ, unusual business insight, or inside information.
What’s needed is a sound intellectual framework for decisions and the ability to keep emotions from corroding that framework.” - Warren Buffett

Are you getting this?

Remember, the asset class that you have invested in doesn’t lose you money – your reaction to it does!

The appropriate asset allocation accounts for 94% of a portfolios return (or retention of your money in a down market)…

How’s your present asset allocation model working?

Has it totally followed recent market declines?

Or has is acted as a “shock absorber” and helped you preserve your capital so that more of it can participate in the next “up turn” – when it comes…

Depending on your answers, maybe it’s time to do a review and overhaul!

Speaking of asset classes, don’t forget that there were people that invested in Canadian real estate ( as an asset class) in the early ‘80’s that lost money…

Why?

Because they became over extended with the high interest rates “of the day” and were forced to “toss in the towel” and walk away from their home/investment when they couldn’t afford their mortgage payments any longer.

I know, because some of these individuals are my clients today…

It’s important to remember that – no matter the asset class:

Bear markets (in that asset class) always end

Bull markets (in that asset class) are stronger and last longer

In the long run, increases (in that asset class) far outweigh the declines

Risk should not be avoided because it offers you “peace of mind”…

Appropriate “risk” must be assumed because of the opportunity for higher returns – over time!

In particular, equities offer one the highest “real returns” – “over time”.

All investors must realize that they cannot to expect to meet their reasonable goals without accepting some level of “market risk”.

That’s why we buy homes for example!

That’s also why we have equities in our investment portfolios!

But we must also not only understand that the level of “risk” (no matter the asset class) diminishes the longer one holds onto an investment – irrespective of that investment…

Just because home prices may have dropped (temporarily) – are we tempted to sell?

Of course not! We still keep paying the mortgage!

So then, what about when the values of our investment portfolios are off?

Well, unfortunately, the answer to that varies…

The ones who “stay the course” invariably win!

Those that do not – well, they lose out!

You must remember that stock markets are “forward looking indicators ” from 3 to 6 to 12 months out.

On the other hand, real estate is a “lagging indicator” and often “trails” the economy as an indicator by up to 2 years!

Right there you have 2 differing asset classes that work and make us all money but are “priced” in 2 differing ways over the same time periods.

Remember, the pendulum always swings!

If things seem too good to be true in one asset class – they probably are.

On the other hand, if markets seem depressed, and the news media is predicting “doom and gloom”, a turn for the better is probably not that far away…

In fact, I know this to be true with over 22 years of experience in the financial services industry.

I believe that the “free market system” that we enjoy here in Canada (and by extension, North America at large) is more elastic than most people believe.

Over the years “the system” has shown a remarkable way of correcting excesses – both on the downside and as well as on the upside.

The pendulum always swings, but as long as innovation continues, and productivity increases, markets will rise over the long term – but not without its halts and/or “regressions” along the way.

How does an investor make sense of this?

With the resources and amount of information on the Internet, investors today can view markets on a minute to minute; an hourly basis; daily; weekly; monthly and yearly basis.

I refer to this as “noise”!

Why?

Because of the infinite amount of information that goes into the minute by minute movements of markets.

The Internet, and twenty four hour a day business channels add to the proliferation of information of news that affect stock markets.

Factors like weather, political comments, economic comments, corporate reporting, consumer buying reports, inflation updates, wars, assignations, terrorist attacks, and human emotions all go into
the minute by minute changes in the market.

Each new piece of information affects millions of individual decisions that cause markets to move.

However, this “noise” has minimal impact on – the long term!

Remember, as long as innovation continues, and productivity increases, markets will rise over the long term – but not without its halts and/or “regressions” along the way.

So, remember: “No matter what asset class that you are in – you will do well – over time!”

However, to reduce the volatility in your portfolio – and to give you “peace of mind” along the way – make sure to keep it all “in balance”!

In stressful financial times like these the media likes to breathlessly report as if “the sky is falling” and that there “will be no tomorrow”… and also to remind us of other stressful times in our history.

That being said, I vividly remember the first one that I “was adult enough” to experience in 1987.

Why?

Because it happened just one year after I had begun my now 22 year career in the financial services industry.

When I look back upon that one (and the others that have followed since) – I realize that while not fun, or a great place to be at the time – it (they) in fact didn’t scar me for life…and it all came out all right.

And now while challenging, economic downturns act as a constant reminder that life is full of change – and change generally scares folks…

So, as a “counter balance” to all the negativity…I have put together my top 9 ideas to help you better cope with the financial stress you may be feeling at the moment in the hopes that this recession will be a soon forgotten memory for you.

1. Turn Off And Tune Out
Author Barry Neil Kaufman says “We stare bug-eyed at the eleven o’clock news, striving to be well informed, as if knowledge of the latest disasters will enhance our sense of well-being.”

Why do you need to watch or listen to the news? Very few people NEED to get their information this way. Short of a tornado headed to your house, you can live your life quite nicely without 24/7 news.

Try it for a week and see what happens.

2. It Will Not Last Forever
Og Mandino is his book “The Greatest Salesman in the World” gave four words that “have been passed down from the ancients that will carry me through every adversity and maintain my life in balance.

These four words are: “This too shall pass.”

He’s right. It WILL pass and 5 or 10 years from today we’ll be reading about this in the paper and we’ll think…”oh yeah, I remember that” and it will make a great story to tell your kids or grand kids.

Who said it?…”the only difference between “tragedy” and comedy is time”…

3. Zip It!
Quit “spouting off” about the economy to everyone you meet. “Pity parties” help no one on any subject – so keep the complaining to a minimum. And don’t hang around people who insist on wallowing in all the negativity.

Ed Diener, author of “Happiness, Unlocking the Mysteries of Psychological Wealth”, says “It’s not that you shouldn’t think about (the economic crisis) but think about it to the extent that you can control it.

If you put your money into places that you were comfortable with a year or so ago, deal with it, review where “the chips are”, make adjustments if necessary – feel good – don’t look back – and move forward.”

4. Laugh
Since 1922, Reader’s Digest has been telling us that laughter is the best medicine. Take daily laugh breaks.

I have always subscribed to that notion and so in fact, on my financial planning site, I have a section entitled “On A Lighter Note” to help us all to maintain a sense of perspective and to encourage laughter!

You can check it out hare at: http://www.howtobesetforlife.com/on-a-lighter-note/

Again, it’s so easy with the internet.

Go to http://Youtube.com and search for “game show bloopers” and you’ll be laughing AND feeling smarter in seconds. “Family Feud” and “The Newlywed Game” bloopers are my favorites.

Additionally, you can find many cartoons, full length movies and sitcoms at: http://Hulu.com

5. Face Your Finances
They won’t get better by ignoring them. They won’t go away. Your credit score might be hurt if you can’t pay your bills or your get behind – but you won’t go to debtor’s prison!

It’s no fun jumping every time the phone rings for fear it’s a creditor. So, if you think that you may need help in Canada go to http://www.nomoredebts.org/ or http://www.creditcounsellingcanada.ca/

6. Keep Track
Be ruthless in tracking your spending and income. By ruthless I mean keep track of every penny. We all have a problem with “mental accounting.” We don’t look at 50 cents as real money and thus would likely not even consider tracking expenses that small. Fifty cents a day over a year is $182.50. It really does add up.

Don’t believe me? I have a “brown bag” calculator on my financial planning Website.
http://www.howtobesetforlife.com/calculators/

This calculator will show you how much you could save if you brought your own lunch to work instead of eating out. It will also calculate the savings if you begin your day with coffee at Tim Horton’s rather than Starbucks…

Keeping track of all your spending can be an eye-opening experience. You’ll often discover unnecessary waste that is easy to fix.

I have created a couple of tools to help you here at: http://www.howtobesetforlife.com/resources/

Just go the bottom of the page and “download”:
“Where Does It Go” And “Set For Life” – Starter Kit

7. Go For A One Minute Walk
It’s been proven that those who regularly exercise have lower stress levels than those who don’t.

In his book, “one Small Step Can Change Your Life – The Kaizen Way”, Robert Maurer, Ph.D. states that the part of our brain called the “amygdala”… “sets off alarm bells whenever we want to make a departure from our usual, safe routines. The brain is designed that way so that any new challenge or opportunity or desire triggers some degree of fear”.

He suggests we take VERY small steps so as not to “wake up” our amygdala.

My favorite example in the book was a client he wanted to march in place, in front of the TV for one minute a day. That would be her exercise routine. Just one minute.

Eventually she marched for 3 minute commercial breaks and then for whole shows.

“Soon her ridiculously small actions had grown into the firm habit of running one mile each day. Note that this gradual build up to a steady program is the exact opposite of the usual pattern, in which a person starts off with a burst of activity for a few weeks, but then returns to a comfortable spot on the couch”.

8. Start Another Income Stream
People who work 9-5 and do nothing else to earn money have always perplexed me.

They get up every day, shower, drive to work, work, drive home, do whatever they do at home, go to bed and start it over again every day for 40 years.

At home they worry about job security, promotions, raises, benefits and the like but they do little if anything to ensure their own future, content to rely on an employer who may or may not be around in 5 years.

Spend some of your worry time researching ways to make extra money. Yes, any bookstore or library will have many books on the subject, but the Internet “is where it’s at” these days…

Get your children involved. Make it a partnership. What an incredible gift to give your children. The gift of independence.

Yes, there may be laws and rules and regulations you need to follow but don’t let those stop you. They are many resources available to help.

Start at the “Small Business BC” resource Website here in Vancouver http://www.smallbusinessbc.ca/

9. Play The Lottery!
No, not the BC Lottery, also known as “a tax on people bad at math”.

I’m talking about the Unclaimed Balances Service run by our very own “Bank of Canada”.

Deep in the heart of the Bank of Canada building in Ottawa, half a dozen civil servants toil at what may be the most satisfying job in the country. Their task, day-in and day-out, is to hand out money to people.

They work in the Unclaimed Balances Service of our central bank. This is where dormant bank accounts go after 10 years of inactivity.

How much money is sitting there, just waiting to be claimed? A large fortune actually. At last count, the Bank of Canada was looking after 938,000 unclaimed accounts worth about $320 million.

You can search the databases online. Most won’t tell you how much is owed but some will give you a range. Search for your name and the names of all your friends and relatives in whatever states they live.

When you find some money that is owed, point your friend or relative to the appropriate website and collect the gratitude (and hopefully a finders fee!) Soon you’ll feel like Santa at Christmas handing out wads of cash.

The site to begin your search is:
http://ucbswww.bank-banque-canada.ca/scripts/search_english.cfm

While you are at it you can get creative and search for the various resources that are available online or through 1-800 numbers to search for:

Unclaimed credit union accounts
Unclaimed life insurance benefits
Unclaimed income tax refunds
Unclaimed Canada Savings Bonds
Unclaimed bankruptcy proceeds
Old stock certificates

So there are nine ideas for you to try.

None of them are hard and most you’ll find rather fun.

Now, repeat after me, “If there is a recession – I refuse to participate”.

Turn off the TV and the radio…ignore the nattering nabobs of negativity and begin to live a less stressful and more peaceful life.

In fact, I have created a FREE Ecourse that will help you – now and in the future!

Join me and others as together we make this the best year ever with:
“21 Days To Your Success”…

http://HowToBeSetForlife.com/motivation

According to a recent survey by the BMO Financial Group – Canadians say that they are aware of the current economic conditions and claim that they are taking the necessary steps to protect themselves

But their actions appear to fall far short of their claims…

The BMO Savings Monitor survey found that nearly two-thirds of Canadians say that they will cut back on their spending, while more than 40% plan to adjust their current investment mix to better withstand economic pressures.

And though the research found that some Canadians are unfazed by recent economic conditions, nearly 70% of respondents said they did not have a financial plan in place!

And 80% said they did not think that economic uncertainty was enough of an incentive to get one.

Frankly, I am so speechless all I can say is: Wow!

However, rather than me talk about the benefits value of having a plan… Listen to one of my clients talk in her own words about the value she has found by having one.

Click Here-To Listen To “Planning Makes Perfect”

Now, while this statement may be seem obvious to some, it’s one I feel needs to be made.

Your retirement will last longer than this market correction — much, much longer.

It might be hard to think about this right now, given how the markets have dropped and all, but it is important to keep perspective in these times.

Its important to understand that investments will rebound and continue to grow during retirement – which for most will be 30 years or more…

You will pull through this market adjustment!

Trust me – I’ve been through 5 of them in my 22 years in the financial services industry.

The real risks in retirement and to retirement income are: longevity (outliving your money), inflation, withdrawal rates, asset allocation and health care.

How many of you are looking through the current volatility to the important long-term issues of planning for income in retirement?

Now, what’s your plan for tackling each of these risks?

Longevity
The simple fact is that retirements are getting longer. In some cases, they can be as long as your working life — 30 years or more for many people. But as retirements increase, so do the risks of outliving your capital. The longevity of Canadians is not going to reverse just because markets are volatile and the economic outlook is uncertain.

Even if some of you choose to retire later than had originally planned, the length of your retirement is likely to be just as long as if you hadn’t delayed.

Inflation
Canada will likely experience an average annual inflation rate of at least 2% per year going forward.

How will this affect retirement income plans! Well, with inflation at 2% annually over a 25-year period this reduces the purchasing power of your retirement income to approximately 60% of its original value!

Interest rates on short-term government securities and longer-term government bonds may rise a little over the next few years as investors move away from the safety of government securities and back to other types of securities in search of higher returns, but interest rates on government securities are not likely to rise enough to provide the protection against inflation that most retirees are looking for.

Therefore, you will still need to look beyond the current urge to be in “cash” and consider the role equities should play in their retirement portfolio.

Withdrawal rates
There will always be discussions about appropriate annual inflation-adjusted withdrawal rates from your retirement portfolios. Some individuals will be thinking of raising their annual withdrawal rates in order to maintain specific income streams from portfolios that are valued less than they were a few months ago.

However, research has demonstrated time and again that for people in their mid-sixties, an inflation-adjusted annual withdrawal rate of 4% is the ideal rate to extend portfolio life to its maximum.

This raises the very basic question of how to keep your withdrawal rates low when investment portfolios are also down. There aren’t any easy answers.

However, one strategy is to always have 2-3 years of basic “living expenses” set aside as “cash”. Then “harvest” profits from portfolios to add to this “cash cushion” when markets are good and draw on the cash when markets are down.

Asset allocation
This brings us to the fourth risk to retirement income which is asset allocation. There are some basic rules for asset allocation that apply to almost everyone — equities, fixed income and cash.

All research shows that having equities in a portfolio is likely to result in the longest portfolio life.

The mistakes made most often in asset allocation are having too much of one asset category.

Having to much in “cash” is just as bad as having to much in fixed income or equities…

Health care
The fifth risk to retirement income is health-related expenses. Not only out-of-pocket health costs but also age-related costs such as the help that may be required for housing and daily care in the later years of retirement.

Like longevity, the need to prepare for health-related expenses doesn’t change just because markets are volatile.

However, what volatile markets may accomplish is to make individuals give serious thought to these costs, and to their choices now and as they age.

Another specific planning area to consider is to build a separate ‘health-care’ fund. In addition to its practical usefulness, a health-care fund will increase individuals’ peace of mind, because they are actually addressing a potential risk to retirement income.

So, while none of us can control the markets there is a great deal we can control and this is the time to do just that.

Knowing all sources of retirement income and their characteristics, facing various economic and market prospects head on and preparing to be flexible enough to react to events as they unfold are likely to improve your retirement prospects in a big way.

So, keep these things in mind when you contribute to your RRSPs this year!

You are going to aren’t you?

Because, as you will be spending the rest of your life in your future: it would be best to do everything possible now to make it a future worth living in! Right?!

I have just completed another Ebook – with audio: The Smart Way To Buy A Car – The UnCanadian Way.

To download your copy immediately (with the audio embedded audio link): Just “right click” on the link below and “save as” to your computer “desktop”…

http://HowToBeSetForlife.com/Reports/TheSmartWayToBuyACar-TheUnCanadianWay.pdf

To download the audio only of this report: Just “right click” on the link below and “save as” to your computer “desktop”…

http://HowToBeSetForlife.com/Reports/TheSmartWayToBuyACar.mp3

All I ask in exchange for this valuable free information is that you “comment” on this blog below…

Let us know what you think!

It’s time to take “inventory” with “What’s Your “Burn Rate”?

Though we haven’t heard this phrase in the media since the late ’90s it is as meaningful now as it was then then…

Check out what I mean by going here to: http://burnrate.ca

(November 13, 2008) It is an age-old question among men: What do women want? When it comes to defining financial success, the answer is “to be debt free,” according to the 2008 TD Waterhouse Female Investor Poll.

The survey found 37% of women defined financial success as living without debt, making it the single most popular goal.

Having enough money for retirement garnered only 17% of the vote, lagging short-term goals like being able to buy anything they wanted (23%).

“The fact that most women concentrate on short-term planning, budgeting and goal-setting is not surprising — it may be an even more natural response in times of economic turmoil,” says Patricia Lovett-Reid, senior vice-president, TD Waterhouse.

“While getting your spending under control is important, it’s not enough. Without a long-term investment plan, we cannot achieve a comfortable, worry-free retirement.”

The most popular step toward financial success was to stick to a budget (55%), while only 25% said they had sought professional investment advice.

With debt management ranking so highly in defining success, it should come as no surprise that paying off credit cards was the most common measure taken (55%) by respondents who feel successful. Only one in five of those who feel unsuccessful did likewise.

Half of those who feel successful contribute to an RRSP, compared to 21% of those who feel unsuccessful.

“Contrary to what some women might believe, getting more engaged in the world of investing provides a sense of empowerment and accomplishment,” says Lovett-Reid. “Burying our heads in the sand does not.”

When it comes to having a financial plan, it appears westerners are ahead of the rest of the country.

Thirty-one percent of respondents from British Columbia and the Prairies said they had a plan, compared to 23% in Ontario, 19% in Quebec, and 18% in Atlantic Canada.

Read the Full Story here at:
http://www.newswire.ca/en/releases/archive/November2008/13/c8059.html

On a personal note: What women (and men) may not understand is that
all debt is not the same…

There’s “bad” debt – the non tax deductible kind such as charge cards and home mortgages.

There’s “good” debt – the tax deductible kind such as borrowing to invest!

Bad debt bleeds you – good debt feeds you…

Bad debt supports a gratification – good debt supports an asset…

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Earlier this past week, well known, Canadian radio personality Charles Adler broadcast his thoughts about our nation and the economy over the air waves in his on air editorial…

It was so impactfull for me that I wanted to share it with you…

When you have finished reading leave your comments!

Canada, Sweet Land of Hope, Hard Work and Prosperity
by Charles Adler
October 27/08
Posted at:
http://www.cjob.com/StationShared/BlogAdler.aspx

The Loonie has been going south.

Unfortunately, confidence in our dollar and our country has been going in the same direction.

I don’t know whether I can make you feel more confident.

But I hope you will allow me to try. I am not asking you for your money.

I am asking you for what’s most precious…Your time.

The reason our dollar is wounded is not complicated.

World markets are suffering indigestion and many mutual fund managers have decided that the best Pepto-Bismol of all is the U.S. Treasury Bill. It yields almost no interest.

However, it is as solid as the Rock of Gibraltar and it is where much of the nervous capital is being parked right now. The purchase of these bills drives up the value of the U.S. greenback and drives
virtually all others down. The English Pound is getting pounded, The Chinese Yuan is getting stomped on and in Canada, Oh Canada we stand on guard for our loonie is flying at a low altitude for the moment.

However, once the markets start to right themselves, the same managers who purchased the t-bills will realize the financial stomach is no longer in a state of peptic dysfunction and they will sell those Greenbacks in a New York minute. It will give the loonie a lift and we will go back up above 80 cents and likely, back up to ninety before much too long.

However in the meantime, we have vultures with a lot of media access who want to use the temporary plight of the loonie to pluck our national confidence. While the vultures prey on weakness and want to mark down Canada, we have a right to Mark Twain them. “Reports of my demise are exaggerated,” said the man who created characters that animated the imaginations of millions for generations.

Exaggeration is something he understood could be a weapon for good and for the opposite. These days exaggeration is being employed to make us want to surrender the future by telling us that we are going to be plunged into a depression as bad or worse than our grandparents or our great grandparents experienced at the end of the 19th century and in the third decade of the 20th. Exaggeration these days is where the vultures live. We don’t have to make their address, our
address.

Canadians have many reasons to be confident about their financial system and the long term prospect for our economy and our currency.

While the U.S. feels the need to strengthen small banks by feeding them like hamburgers to the big ones, we have no such issue here.

We have almost nothing but big banks. And, you know which ones they are. It’s where your money is. Unlike many of the American and European banks, ours have not been operated by card sharks and so they are not casinos.

We also have some old fashioned rules that have been working rather well to keep our real estate prices relatively stable.

Rules like requiring prospective home owners to put real money down before being able to purchase a home. Because we don’t have a U.S. style tax system that discourages us from building up equity in that home, many of us actually own our own homes.

The American system allows you to deduct the interest on the mortgage you pay each month. So you don’t have much incentive to build up equity. You just pay and keep paying the juice on a very large amount of money because you can deduct the juice when you pay your taxes. That encourages people to buy more house than they need and not build up equity and therefore savings in their houses. When times are very good, this can work to promote a lot of real estate growth and for years that’s what happened.

But when you create a bubble through having too many houses, with not much equity in them by the person responsible for paying the mortgage and then you have bankers selling the risk on these mortgages to others and not keeping track of who owes what to whom, you get chaos.

If only the prices for houses had kept on going up by ten to twenty to thirty percent per year forever this housing crisis wouldn’t have happened.

But just like you cannot repeal the law of gravity, you cannot repeal the law of supply and demand and when you create so called exotic instruments like derivatives and credit default swaps you have what one of the richest men on earth Warren Buffett calls “Weapons of Mass Economic Destruction,” which is what we have had.

The Americans talk about home ownership. But it’s clear as a bell that when you have no equity in a home because all you’ve been doing every month is paying the juice on the mortgage, if the value of the home drops like a rock, you have no incentive to keep paying the juice, and since you put almost no money down to buy the home, you have no reason to stay in it. Pick up the keys banker. I am
so out of here. That’s the American scenario right now.

Does it sound anything like our own?

It does not and it will not. We play by different rules and they protect the most important asset in our lives, our HOMES.

Just as the banks in the U.S. have been turned into gambling parlors, many ordinary Americans who did have some equity in their homes have taken out home equity loans. They received money from the banks based on the equity had. Many used the money to buy stuff they didn’t really need and stocks they no longer want. And yes, they do have to keep paying the juice on the money borrowed to buy stocks that are going down instead of up.

Many Americans have bet the ranch, the farm, the bungalow and the dog house on the stock market. Any wonder why so many are angry enough to roll the dice on a presidential candidate with as much leadership experience as your twelve-year-old? Any wonder why they are willing to paste and punish any candidate for any office that is contaminated with the word Republican beside their name? Any wonder why they are about to vote themselves a White House, a House of Representatives and a
Senate where the Democratic Party will have unbridled power? Any wonder why they are ready to throw out their general desire for divided government, creating checks and balances to presidential
or congressional power?

In this country, in a recent election, Canadians had the option to punish every Conservative for the current decline of the World Economy. But we chose not to do that. We made the right choice.

Folks it’s difficult to see the sun when you feel that you are buried in the deep pit of despair, and when you have many folks with media platforms engaging in predatory behavior. Preying on your fears and insecurities and in some cases preying on the sheer blind ignorance of the massive wealth that this country literally has inside its soil.

Because of the abundance in the ground and the knowledge we have in our heads, we have a country that will continue to walk tall among the nations of the earth.

Maybe we need to be reminded once in a while about our millions of acres of timber and grains and the vast pools of oil and gas, potash and uranium and all the other minerals that the world needs to feed and heat itself. It’s true that minerals do not create a steely spine, which is what many of us need to develop right now. The question is asked everywhere in Canada. Will commodities come back? Does a bear eliminate in the woods? It’s true that The Stock Market Bear wants to eliminate everywhere
and over everything. But that too will pass.

The doom and gloom spinners that have your attention right now can corrode confidence.

They can lease fear. But they cannot own and can never conquer TIME.

Time always marches forward.

Tomorrow can never be yesterday.

Renewal of days and weeks and seasons give us hope. The doom and gloom crowd always wants you to believe that the distant future is even worse than the recent past. They will always find numbers to justify the equation. But their arithmetic adds up to failure of spirit if you permit it. If you allow them to beat you with their numbers, you are surrendering to the worst kind of defeat there is. A defeat with no sense of purpose, no positive outcome and worst of all, no honor.

Time marches forward. That’s why it’s called Progress.

The history of human achievement is based on Progress.

The forces of darkness have always been committed to the opposite.

They want you to stop believing in the future and ultimately in yourself.

Although I have mentioned the incredible resources this country is awash in, the most important and ultimately the best resource we have is our people, many of whom have been through tough times in this country and elsewhere.

I grew up with many of these folks (Charles Adler is Hungarian), survivors who in the end could not extinguish their memories of Communism and Fascism, the twin towers of darkness that crushed so many members of their families. I grew up with people who weren’t just frightened by stock market numbers and unemployment numbers.

They were terrified and terrorized and traumatized by having people they knew shot, imprisoned, tortured, and executed. The mauling of the markets pale in comparison with the massacre of millions of people who just happened to be in the wrong place, at the wrong time in history.

We are living history right now and we will be talking about these times for a long time.

But we have a choice.

We can make hope and progress our friends or we can do as we are being urged to do, to throw up our hands and declare to our friends and families that the sun has set on our hopes and dreams, and will never rise again.

I’m asking you as just one ordinary Canadian with extraordinary access to you and your mind.

Don’t let them win.

Don’t cave to the cave dwellers.

Don’t cave to the forces of darkness.

Don’t give them everything they want. Your confidence, your hopes, your dreams don’t belong to them. They are yours as long as you choose to hold on to them.

There is a name for the person who only believes in defeat. Don’t make it yours.

This is the greatest country on earth and you are alive to share it with me and more than 33 million others.

You may not feel it every day. And you may not feel it right now. But I have to tell you that based on where I came from and where I have been and what I have seen and who and what I have known, I can tell you that every day I wake up in Canada, I feel that I am the luckiest person on earth. Forget about lottery tickets, my Canadian Passport is my winning ticket.

For so many in this country, we see it as the Passport to the Promised Land. You may not see it that way at this precise moment in time.

But some day when this storm blows over, don’t forget where you were on Monday October 27th, when you had a choice to make between Confidence and Despair.

Confidence always feels like the toughest choice during a violent storm.

But it’s the only ticket worth punching.

I have never been a more confident Canadian than I am right now.

Thanks for listening to my head and my heart.

Oh Canada, we stand on Guard for Thee, Sweet Land of Hope, Hard work and Prosperity.

(End editorial)

Well, what do you think?!

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