Inflationary Other Kinds Of Answers…

If you watch the news daily, you’d think that our economy was in un-recoverable shambles, that our financial worlds are ending and all investors should stay away from windows in tall buildings. Even to the point that we all should be buying only food, fuel, ammo and toilet paper preparing for the hostility at the end times. 

I do not think it is that bad quite yet… As Seasoned Human that has seen times like this before, I think that saving all of your money is a BIG mistake right now.

First, this is just my opinion and these are actions I am currently doing, as the deals right now are better then they have been in years! I have been watching and paying close attention for the last number of years, always looking for my other kinds of answers. Not all the answers are of only the Knowledge and wisdom kind that I am looking for. Financial other kinds of answers are worth looking for also.

I now believe our situation, as a whole, seems dire enough now and First, Yes, an emergency fund is a requirement for any sound financial planning effort and I do have mine in place. But saving every last penny is the last thing you should be doing right now! It is the time to buy the things that you’ve been putting off because every signal out there is telling you to save everything.

The laws of supply and demand are in our favor because very few folks are buying, which means the people who are, will be getting incredible deals, if they are willing to negotiate and put in the time for research, exploring and planning. This goes for minor cost items like simple tools and supplies of life or business, all the way to major capitol Items, such as second homes, rentals and whole businesses.

With no one spending their money, because they’re saving or holding… this means banks won’t be giving you great interest rates because they don’t have to, and they have too much money, or even too much bad debt! That’s only the beginning of this very large financial story…

Apparition of Inflation

The government seems pretty savvy; they know you’ll get upset if they raise the taxes without giving you a very very good reason. Fortunately they have another weapon, printing presses. When the government pumps more money into the money supply, the value of your dollars can decrease. The government has made trillions of dollars in promises to financial institutions, automakers, and many other smaller profile parties through its actions the last few months and it will have to fund them somehow.

Part of it will be funded by borrowing, but some of it will come through increasing the supply of money. Inflation won’t be an issue while we’re in a recession, but it’ll be a beast of a problem whenever we’re no longer scared of the recession. Be warned now and be thinking ahead for Other Kinds of Answers…

Negotiate Deals

The time to buy is when others are panicking. When you have the benefit of timing, you control all the power in periods of economic uncertainty. I’m not talking about just the stock markets, I’m talking about everything! If you wanted a house, now is the time to buy because interest rates are low and home prices are even lower. Heck, even the Government, Federal and State maybe willing to give tax breaks and grants, if you will move now.

If you wanted to make improvements to your house, start talking to contractors because their business is slow and they will be willing to cut deals just to stay in business. If you wanted a car, dealerships will offer great incentives because they need to boost their sales numbers. Even if it’s something as simple as an appliance, you can negotiate the price down and get an energy savings tax credit to boot!

And don’t buy things you don’t need just because they’re a deal, that’s reckless, buy only things you need and negotiate it down to the bare bone pricing. Watch out for hooks in the deal also, things that you have to do to get the GREAT Deal, or are added at the sale’s close…Required Install labor, shipping charges or more fees can eat up any great deal in a hurry

Bank like Banks Do

Ever received one of those offers in the mail that seems like the solution to all your problems? It may have said, "Your home is an untapped resource. Refinance your loan with us and you'll get quick cash to buy something, fund college, add to savings or pay off your debt." You may have been tempted by the idea, but hopefully you didn't bite. There are much better ways to solve problems with debt. Refinance your loan; in the long run could actually cost you much more money. Keep reading…

There is a newer option in the USA and Canada you may not have heard about. You should really consider a look at what can be found at www.aboutu1st.com and I know that everyone has to look at what is best for their own requirements, and this will not be a good fit for everyone. In full disclosure, my own family has been using this idea, and it is working very well, even enough for me to take the time to become an agent sharing the idea with others. And NO, it not a MLM!

Lower Interest Rate Doesn’t Always Equal Saving

First, make sure that you are really saving money if you do refinance. It’s not enough to compare 6% to 4.5%. What you need to do is determine how much interest you’ll be paying if you keep the original loan versus the total cost of the refinanced loan (i.e., interest plus closing cost). To do this correctly, you’ll need a good mortgage calculator. There are many worthy FREE ones on the web. For example, let’s assume your original $300,000 loan is a 30-year fixed rate loan at 6% and you’re refinancing to a 15-year fixed rate loan at 4.5%

Age of the original loan (years)	Interest remaining on old loan	Principal balance to refinance	Interest cost of new loan	Savings before closing costs and other fees
10	$180,620.08	$251,057.36	$94,645.79	$85,974
15	$110,611.51	$213,146.93	$80,353.74	$30,258
20	$53,828.02	$162,011.42	$61,076.08	($7,248)

As you can see from the scenarios above, you could lose money by refinancing to a lower interest rate. In general, it’s more advantageous to refinance newer loans than older ones, because most of your money goes toward paying interest at the beginning of most loans.

Interest Rates Are Low NOW

The federal funds target rate “range” is 0.00% to 0.25%, which means the government doesn’t want you to save, they want you to spend! The federal funds target rate is the target rate the Fed wants banks to lend to other banks on an overnight basis (to meet capital requirements). They achieve this rate by expanding or restricting the amount of money available. If a bank can borrow money from another bank for 0% - 0.25%, what incentive do they have to pay you anything for your savings? Almost none. The end result is that you get almost no interest from your savings, or bank investing, as another way to look at it.

Another quick point, you may even be able to get 18 to 36 month 0.0% financing right now on many items, so you do not have to spend your cash savings right now. Yes, in some cases, you do have to spend at least a certain minimum amount to get those deals, but in many cases, you can reach the minimum by buying two, three, or four items together. Just be sure that you understand all the details of the deal and all the fine print.

In other words, the government doesn’t want you to save your money; they want you to spend it and help boost the economy! And let’s be honest, unless you start spending, the government will only get worse in how it pumps more money into the system, or even has to manage everything by taking over everything.

Reward the Entrepreneurs

The United States was built on the shoulders of entrepreneurs; reward them by giving them your business. Don’t overpay for things because you feel badly about their financial situation, that’s not necessary, but spend your money at the places you like and the businesses you enjoy dealing with. They won’t close a sale unless it makes financial sense to them but they do need the sales. Giving them business will give them additional capital to work with and, if they’re doing well in the downturn, expand and add more available jobs to the system, thus more people out spending.

I firmly believe that the way out of this whole big mess is through business growth spurred on by something, whether its consumer confidence and increased spending or whatever that improves our infrastructure, it will be led by small businesses and entrepreneurs, with other kinds of answers.

Think carefully before you borrow money to do anything. When you borrow, you are guaranteed to lose the amount you pay toward interest. However, you are not always guaranteed a better return on investment on borrowed money. I know this article is heavy on mathematics, but I hope you will enjoy learning about the process and it is pretty clearly about Other Kinds Of Answers...

Tax Day Other Kinds Of Answers…

Maybe just to see a brighter perceive of other answers, as far as taxes goes, here is a semi-holiday from my own calendar, which I hope by sharing and telling everyone about will help in these days when there seems so little. Always remember, it is when the times are the toughest, the other kinds of answers are both most needed and the easiest to find.  Read on...

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America Celebrates Tax Freedom Day® April 13^th, 2009
America Will Work 8 Days Less to Pay Taxes in 2009 than in 2008; Recession, Stimulus Package Push Date of Celebration Up

Read the full Tax Freedom Day report here.

Washington, DC, March 31, 2009 - Tax Freedom Day will arrive on April 13 this year, according to the Tax Foundation's annual calculation using the latest government data on income and taxes.

This is eight days earlier than in 2008, and a full two weeks earlier than in 2007, for two reasons: (1) the recession has reduced tax collections even faster than it has reduced income, and (2) the stimulus package includes large temporary tax cuts for 2009 and 2010. Nevertheless, Americans will pay more in taxes than they will spend on food, clothing and housing combined.

In the study, Tax Foundation Special Report No. 165, "America Celebrates Tax Freedom Day," Tax Foundation staff economist Josh Barro traces the course of America's tax burden since 1900, examines the composition of today's tax burden by type of tax, and finally calculates a Tax Freedom Day for each state.

Taxes and Federal Deficit

Tax Freedom Day moves somewhat independently from an alternative calculation that adds the federal budget deficit to total taxes collected. In 2009, an unprecedented budget deficit over $1.5 trillion produces a date of May 29. This is the latest date in the year this deficit-inclusive measure has ever fallen. The only previous years when taxes and deficit spending comprised a similarly large share of national income were 1944 and 1945, at the peak of World War II. In the postwar era, this date had never fallen later than May 9 (in 1992). Figure 1 below shows Tax Freedom Day as traditionally presented and with the inclusion of the federal budget deficit, since 1967 (click to enlarge).

Tax Freedom Day Fluctuations in Recent Years and Predictions for the Near Future

In 2000, Tax Freedom Day was celebrated May 3, the latest date ever. A string of tax cuts between 2001 and 2003 pushed Tax Freedom Day up by more than two weeks, so that it fell on April 16 in 2003 and April 17 in 2004. For the next three years, incomes and tax collections soared, pushing Tax Freedom Day back to April 26 in 2007.

Since 2006, corporate tax revenues have fallen sharply and are projected to do so again in 2009. Personal income taxes also fell in 2008 and are expected to fall again in 2009 due to the weakening economy and tax cuts in the stimulus package. Because most of this year's stimulus package's tax cuts continue through 2010, Tax Freedom Day could be expected to shift later by a few days next year only if the economy improves. For 2011, both the stimulus package's tax cuts and the earlier Bush tax cuts of 2001 and 2003 are set to expire. The future timing of Tax Freedom Day will depend on which tax cuts Congress and the Obama Administration choose to extend through 2011 and thereafter.

Which Taxes Are the Biggest?

Five major categories of tax dominate the tax burden. Individual income taxes, both federal and state, require 38 days' work. Payroll taxes take another 27 days' work. Sales and excise taxes, mostly state and local, take 15 days to pay off. Corporate income taxes take 6 days, and property taxes take 12. Americans will log 4 more days to pay other miscellaneous taxes, most notably including motor vehicle license taxes and severance taxes, and about 1 day for estate taxes.

Tax Freedom Day by State

Residents of Alaska will bear the lowest average tax burden in 2009. Because of their modest incomes and extremely low state-and-local tax burden, we estimate Alaska's Tax Freedom Day for 2009 to be March 23. Louisiana, Mississippi, South Dakota and West Virginia round out the five states that we project will experience Tax Freedom Day earliest in 2009.

The residents of Connecticut will celebrate last, as usual, working until the 120th day of the year, from January 1 to April 30, before earning enough to pay all their taxes. Because Connecticut's income per capita is higher than in any other state, its residents pay extraordinarily high federal income taxes. Nearby states New Jersey and New York are second and third, respectively, California and Maryland round out the top five.

Tax Freedom Day by State, 2009
State	Days Spent Working to Pay Taxes	Tax Freedom Day	Rank
United States	103	April 13	---
Alabama	92	April 2	44
Alaska	82	March 23	50
Arizona	100	April 10	23
Arkansas	94	April 4	37
California	110	April 20	4
Colorado	102	April 12	16
Connecticut	120	April 30	1
Delaware	101	April 11	20
Florida	99	April 9	27
Georgia	102	April 12	17
Hawaii	103	April 13	14
Idaho	102	April 12	18
Illinois	103	April 13	15
Indiana	98	April 8	28
Iowa	94	April 4	39
Kansas	98	April 8	30
Kentucky	93	April 3	41
Louisiana	87	March 28	49
Maine	96	April 6	33
Maryland	109	April 19	5
Massachusetts	106	April 16	7
Michigan	100	April 10	24
Minnesota	105	April 15	9
Mississippi	87	March 28	48
Missouri	96	April 6	34
Montana	93	April 3	42
Nebraska	98	April 8	31
Nevada	98	April 8	29
New Hampshire	100	April 10	22
New Jersey	119	April 29	2
New Mexico	92	April 2	43
New York	115	April 25	3
North Carolina	99	April 9	25
North Dakota	91	April 1	46
Ohio	101	April 11	21
Oklahoma	94	April 4	40
Oregon	99	April 9	26
Pennsylvania	104	April 14	11
Rhode Island	104	April 14	10
South Carolina	94	April 4	38
South Dakota	88	March 29	47
Tennessee	95	April 5	36
Texas	96	April 6	32
Utah	103	April 13	13
Vermont	102	April 12	19
Virginia	106	April 16	6
Washington	106	April 16	8
West Virginia	91	April 1	45
Wisconsin	103	April 13	12
Wyoming	95	April 5	35
District of Columbia	103	April 13	---

How Tax Freedom Day Is Calculated

Tax Freedom Day answers the basic question, "What price is the nation paying for government?" An official government figure for total tax collections is divided by the nation's total income. The answer this year is that taxes will amount to 28.2 percent of our income, and the stretch of 103 days from January 1 to April 13 is 28.2 percent of the year. Income and tax data are then parsed out to the states, yielding 50 state-specific Tax Freedom Days.

Tax Freedom Day: Origin and Methodology

Tax Freedom Day was conceived by Florida businessman Dallas Hostetler in 1948. He performed the calculation himself and promoted his copyrighted concept until his retirement in 1971. He deeded the intellectual property to the Tax Foundation, and since then the Tax Foundation has used historical data to calculate Tax Freedom Day back to the beginning of the 20th century. In 1990 sufficient data became available to calculate a separate Tax Freedom Day for each state.

Tax Freedom Day is a vivid, calendar based illustration of government’s cost, and it gives Americans an easy way to gauge the overall tax take. We count every dollar that is officially part of national income according to the Department of Commerce’s Bureau of Economic Analysis, and every payment to the government that is officially considered a tax is counted. Taxes at all levels of government are included, whether levied by Uncle Sam or state and local governments. We assume that the nation starts working on January 1, earning the same amount each day and spending nothing. When the nation has finally earned enough to pay all the taxes that will be due for that year, Tax Freedom Day has arrived.

 

For more information and a full copy the report,
go to http://www.taxfoundation.org/publications/show/93.html.

Some Foolish Other Kinds Of Answers...

All Fool's Day, also known as April Fool’s Day, is celebrated annually on the first day of April. It is a time for the traditional playing of pranks upon unsuspecting people... the victim of such a prank being called an April Fool.

The origins of this custom are somewhat uncertain, but may have initially been related to the arrival of Spring in late March, at which time Mother Nature is said to "fool" with the human race with sudden and fickle changes in the weather... showers or snow one hour and sunshine for the next, Which happens frequently the in Utah. In fact of the matter, at this very second, it is snowing outside as I type this blog. We have about 5 inches, and it is still coming!

The playing of practical jokes, however, dates back to Ancient Rome and such activities were an integral part of the Hilaria celebrations held on March 25, a celebration which would again appear to be associated with the coming of Spring and the Vernal Equinox, held to honor the resurrection of Attis, Roman God of Vegetation who was linked to the seasonal cycle. In England, an ancient legend states that April Fool's Day commemorates the fruitless mission of the Crow, which was sent out in search of land from Noah's flood-encircled ark.

It is generally accepted that the All Fool's Day tradition began in France during the Sixteenth Century, when the beginning of the New Year was observed on April 1 and was celebrated in much the same way as New Year is today with parties and dancing late into the night. At that time, the festivities ran for a week, beginning on March 25, and included the exchanging of gifts.

In 1582, however, during the reign of King Charles IX, Pope Gregory introduced a revised calendar for the Christian world wherein the New Year fell on January 1. Since it took some time, possibly even years, for many people to even hear word of the change (communications being what they were in the Sixteenth Century) and since others obstinately refused to accept such reform or simply forgot, New Year's Day continued to be celebrated on the first day of April in many areas.

Individuals who had accepted the dates of the new calendar played tricks on those who had not and referred to the unfortunate victims of such pranks as "April Fools," sending them on a "fool's errand" (an invitation to a non-existent party, for example) or attempting to make them believe that something which was true was actually false.

Over time, this practice evolved into an annual tradition of April 1 prank-playing, eventually migrating to England and Scotland during the Eighteenth Century and thus, introduced to the American colonies by British and French settlers.

There is even speculation that All Fool's Day originated in the Hindu festival of Huli or Holi, celebrated in March to commemorate the defeat of evil. Originally lasting for five days, the modern version of this festival covers two days only. On the first day, a bonfire is lit and, on the second, people throw colored powder and water over each other. Holi celebrations are associated with the Hindu Demoness, Holika.

In many cultures, tradition dictates that the pranking period must expire at noon on April 1 and any jokes attempted after that hour will bring back luck to the perpetrator. In addition, any who fail to respond with a good humor to tricks played upon them are said to attract bad luck unto themselves. Such victims are, however, entitled to "turn the tables" after the hour of noon with the retort: "April Fool's gone past...and you're the biggest fool at last!"

It should be noted that not all April Fool superstitions are so negative. Males, who are fooled by a pretty female, for example, are said to be fated to marry the girl...or at least enjoy a healthy friendship with her. Part of these pranks played is to awaking the hapless male into noticing the young lady, by use of her wit and wilds. Maybe another reason for so many spring late weddings...

The style of April Fool's pranks has changed over the years. Sending unsuspecting parties on pointless errands was a particularly prized practical joke in the early history of the celebrations. Today, however, it is often a time of initiation rites into a club or group, especially by the adult population, and it is the children who appear to truly celebrate the day complete with its original sense of abandon. Otherwise, modern pranks tend to center more around bogus telephone calls, text messages and media-driven foolery.

In summary, All Fool's Day is a "for fun only" observance...a time when nobody is expected to buy gifts, receive cards or spend money and there are no vacations from work or school. The primary force behind April Fool's Day jokes and pranks are that they should not be harmful but able to be enjoyed by everyone...especially the person upon whom the joke is played. So, I hope that this will serve as a warning and also supply some Other Kinds Of Answers…