You can’t always avoid natural disasters like earthquakes, floods, or hurricanes, but you can minimize their impact on your finances. Do you have a plan for how you would cope if a hurricane like Katrina or Floyd or some other potentially devastating event even the loss of a job hit you?

Have a Plan

Think about. What are the disasters that could most likely affect you and your finances?  Now, imagine that a disaster did happen.  What would you want to have taken care of ahead of time? Begin to do those things. Take care of yourself, your loved ones, and your property first; prepare a survival plan; maybe stock up on clean water, flashlights, batteries, an emergency kit, and canned goods.  But beyond these steps, it also critically important to set up a good practical financial plan. Keep Reading...

SLOPPY FOURTH QUARTER;  According to Morningstar,  the average returns by mutual fund category for the fourth quarter of 2007 were:

1. taxable bonds:  +1.3%
2. municipal bonds:  +0.5%
3. international stocks: -0.8%
4. U. S. stocks:  -2.8%

SLOPPY WEEK:  For the week, the Dow declined -1.5%, the S&P 500 -0.75%, Nasdaq -2.6%, and the Russell 2000 -2.4%. Year-to-date, the Dow is now down -4.9%, the S&P 500 -4.6%, Nasdaq -8.0%, and the Russell 2000 -8.0%. GROWING RETIREMENT ASSETS: According to a recent study by the Investment Company Institute, total U.S. retirement assets climbed to $17.4 trillion at the end of the second quarter of 2007, up from $16.7 trillion at the end of the first quarter of 2007. Retirement savings account for almost 40 percent of all household financial assets in the U.S. IRAs held $4.6 trillion at the end of the second quarter of this year, up from $4.4 trillion at the end of the first quarter. Mutual funds manage 47 percent of IRA assets. Americans held $4.4 trillion in all employer-based defined contribution retirement plans, of which $3.0 trillion was held in 401(k) plans. Those figures are up from $4.2 trillion and $2.8 trillion, respectively. LONG TERM CARE COSTS:  If you wonder what the costs of long term care are in your area (they vary wildly), check this website:  

https://www.ltcfeds.com/ltcWeb/do/assessing_your_needs/costofcare?action=costofcare Keep Reading...

A BAD START: The year has started off on a bad note.  (I am watching Chariots of Fire on ESPN Classic as I write this.  The Scottish runner, Eric Liddel slipped and fell but finished his race in first—I hope the markets mirror this performance in 2008).  After only three trading days, the S&P 500 is down 3.86% (2nd worst start ever), the Dow is down 3.5% (4th worst ever), and the Nasdaq is down 5.57% (worst ever).

JOBS: This past week’s bad news that was a bit of a surprise came in the form of the jobs report from the U. S. Commerce Department.  Expectations weren’t particularly high.  Analysts had estimated that we’d see about 70,000 new jobs in December.  The gain was only 18,000.  Also, the nation’s unemployment rate jumped to 5%. Keep Reading...

Various economists and investment houses are now coming out with their “odds” as to whether we will move into a recession. Here is my wisdom: I don’t know. Of course, you should be prepared in case we do or if we don’t. Depending on your situation, you want to be appropriately defensive, but not so “safe” that you do not participate in market growth when it occurs. Make sure you know how you are invested, have a strategy and sleep well.  If you are not sleeping well, you either don’t have a strategy, or you do but it is too aggressive. (Past performance is never a guarantee of future results.) A GOOD START:  I hate getting caught up in this, but holiday consumer spending is an obsession, so here I go:  According to ShopperTrak RCT Corp., which tracks sales at more than 50,000 retail outlets, total sales rose 8.3 percent to about $10.3 billion on Friday, the day after Thanksgiving, compared with $9.5 billion on the same day a year ago. ShopperTrak had expected an increase of no more than 4 percent to 5 percent. A SHORT TERM PLUS FOR THE FALLING DOLLAR: The falling dollar is rife with danger for this economy.  For the moment, U.S. shopping outlets are benefiting from foreign visitors making trips to the U.S. for the specific purpose of doing their holiday shopping.  For example, in my former hometown of Wrentham, Massachusetts:  a record 1,000 international tourists have scheduled organized shopping trips as of yesterday to Wrentham Village Premium Outlets – more than double the number last year. Hundreds more were expected to come on their own, according to Beth Winbourne, the outlet’s general manager. Boston is projecting a 14 percent increase in overseas visitors this month compared with November of last year. A BAD HOUSING OCTOBER:  In October, new residential construction was higher than expected. But, all of the gains were in multi-family units, not single-family dwellings, which were down another -7.3%. New construction permits were down -5.9%. FUEL COSTS AS A PERCENTAGE OF TOTAL EXPENSE LEVELS: People in Alabama, Mississippi, and Kentucky spent more than 11% of their income to fuel their car, while residents of New York and New Jersey average less than 2%. STATE TAX RATES: As a percentage of income, the state with the lowest tax burden is Alaska at 6.6%. Rounding out the top five were New Hampshire, Tennessee, Delaware, and Alabama. The state with the highest tax burden at 14.1% is Vermont. Rounding out the top five are Maine, New York, Rhode Island, and Ohio (between 14% and 12.1%). New Jersey is 10th at 11.6%. Connecticut is 8th at 12.2%. Maryland and Pennsylvania are virtually tied for 23rd at 10.8%.

If you would like to apply for a Mortgage Loan, you can APPLY ONLINE HERE, you can call John Thomas at 302-703-0727.

John R. Thomas – NMLS 38783

Certified Mortgage Planner – Primary Residential Mortgage, Inc.

302-703-0727 DE Office / 610-906-3109 PA Office / 410-412-3319 MD Office

248 E Chestnut Hill Rd, Newark, DE 19713

HOLIDAY SPENDING?:  Americans skimped on furniture and sporting goods in October to offset higher energy costs. As a result, Lehman Brothers Holdings Inc. is anticipating “one of the weakest” holiday shopping periods in years. Meanwhile, a less-than-forecast 0.1 percent increase in wholesale prices reinforced traders’ expectations that the Federal Reserve will be forced to reduce interest rates again next month.

THE WEEK IN THE STOCK MARKET:  The market’s volatility is driving everyone crazy, but the end result this week was a moderate advance. The Dow [+1.03%; +5.73%], the S & P 500 [+0.35%; +2.85%], and the NASDAQ Composite [+0.35%; +9.19%] all gained. One reason for the gains was a positive report from Wal-Mart. Despite the chilly retail sales report mentioned above, Wal-Mart posted good gains and forecast a fairly rosy holiday season. Keep Reading...

BLACK MONDAY – Last week marked the 20th anniversary of Black Monday on Wall Street. From a total US stock market capitalization of $2.3 trillion following the losses of 10/19/87 the total value of US stocks has rebounded to $18.7 trillion today, an annual growth rate of +11% over the past 2 decades. HERE COME THE BABY BOOMERS:  At an event hosted by the Commissioner of Social Security, the nation’s first Baby Boomer, Kathleen Casey-Kirschling, filed for her Social Security retirement benefits online at www.socialsecurity.gov.  Ms. Casey-Kirschling, who was born one second after midnight on January 1, 1946, will be eligible for benefits beginning January 2008. http://www.socialsecurity.gov/pressoffice/pr/babyboomerfiles-pr.htm

THE SINKING U.S. DOLLAR: Keep Reading...

There will be a Free Seminar – Financial Planning for Everyone on Tuesday, October 23, 2007, from 6:30 PM till 8:00 PM.  The seminar will present the basics of making a financial plan and provide the participates with all the tools they need to design their own financial plan.  The seminar is being presented by Douglas MacGray of AGE Equities.  He is a Certified Financial Planner, licensed Attorney, and certified Estate Advisor.

To register for this seminar please call 302-703-0727 and ask for John Thomas. Keep Reading...

This is a weekly update from Doug MacGray a Certified Financial Planner who takes very good care of my clients and who I highly recommend.

INTEREST RATE CUTS: Are there downsides to the Fed’s cut in interest rates? Answer: Of course. First, the possibility of higher inflation usually goes along with a drop in rates. Most don’t think that’s a real issue these days due to the slowdown in the economy and the impact of globalization. Two major indications of this were announced this week. The Consumer Price Index (CPI) of -0.1% and the Producer Price Index (PPI) of -0.4% dropped.  Those low inflation numbers effectively gave the Fed “permission” to focus its concern on economic growth rather than price stability. As long as growth lags, and inflation remains modest, the Fed will be under pressure to keep rates low. The second negative consequence of lowering interest rates was the effect on the U. S. dollar. The dollar dropped to record lows against the Euro (¬) and fell to even parity against the Canadian dollar for the first time in more than thirty years. The weak dollar makes foreign goods and overseas investments more expensive, but it also helps American manufacturers sell more of their products in foreign markets. Higher exports usually translate into more job growth here at home. The Fed’s action won’t solve housing’s problems overnight, and it’s not likely to boost growth by that much, either. I have read and heard responses by many economists who know a lot more about this than me, and a slim majority seem positive about this move by the Fed.  (See some quotes at the bottom of this post) Keep Reading...