We live in some pretty interesting times these days, it seems everywhere you turn it’s “Gloom & Doom” from the medias perspective. Remember the media thrives on reporting negative not the positive stuff!
Wanted to share my prospective on “what would be good financial decisions” for better positioning for the future based on the current landscape of the economy and how to best position yourself and your family for the future. No one knows what the future holds, but based on an overview of the financial markets and a bit of history, we can make decisions that give us a better footing for the future no matter what happens.
I will touch on a few things that you can do and will serve to put you in a much better position for your future financial well being.
1) With the current state of our economy and the unprecedented amount for money the Federal Reserve has pumped into the global market, it’s pretty safe to say we are seeing inflation on almost everything we consume. Now I will not spend the time reviewing how inflation works, but it’s pretty simple, as inflation goes up it diminishes our buying power of the dollars we have and therefore we can not buy as much. So you ask how I can hedge myself against this. A few things you can do, I posted a good article on a previous blog post (read post here) on the ability for you to take advantage of the historically low interest rates to keep your future housing expenses low, especially if you currently rent, which puts you at the greatest risk since future rents will continue to escalate as inflation goes up. Remember you will live somewhere, so why not own your own home instead of paying your landlord’s mortgage!
2) If I already have a home / mortgage and do not have an interest rate in at least the low 4s, it is important to refinance into a lower interest rate. Now a large percentage of homeowners do not have the equity to just refinance into a low rate, but the good news for you if your in that situation, new modifications to the “Making Home Affordable Program” or HARP as it’s known, will allow you to possibly streamline refinance into the low interest rates of today and lower your fixed housing expenses. You can read a past post (read post here) that provides a detailed questions and answers on this revised program.
3) Investments come in many shapes and sizes and if you are a person who has investments, you need to make sure your investments are at least growing at a faster pace than inflation or you are going backwards (true inflation is higher than the government’s published index) Owning real estate is and always has been a great long term investment, but like any investment buying or selling at the wrong time will be a bad investment. With the value corrections in the real estate market and the current record low interest rates, coupled with some unique opportunities in buying foreclosure properties (read post here) you can accelerate the growth of your investment portfolio or even allow you to buy your first home way below current market value, so you have built in equity from day one.
So with the tremendous turmoil in the world around us, another important thing you can do is build a surplus of non perishable foods and staples along with extra items you use every day in case of a natural disaster or a situation that cuts off the retail supply chain. Our whole national retailer supply chain, especially grocery stores is built on replenishing every 3 days, so if that supply chain is cut off for what ever reason, you want to make sure you and your family have what you need to eat and survive for at least 10 days or longer (in my opinion) Here is a good website that will give you ideas on what items to start stocking up on.
Wanted to share my prospective on “what would be good financial decisions” for better positioning for the future based on the current landscape of the economy and how to best position yourself and your family for the future. No one knows what the future holds, but based on an overview of the financial markets and a bit of history, we can make decisions that give us a better footing for the future no matter what happens.
I will touch on a few things that you can do and will serve to put you in a much better position for your future financial well being.
1) With the current state of our economy and the unprecedented amount for money the Federal Reserve has pumped into the global market, it’s pretty safe to say we are seeing inflation on almost everything we consume. Now I will not spend the time reviewing how inflation works, but it’s pretty simple, as inflation goes up it diminishes our buying power of the dollars we have and therefore we can not buy as much. So you ask how I can hedge myself against this. A few things you can do, I posted a good article on a previous blog post (read post here) on the ability for you to take advantage of the historically low interest rates to keep your future housing expenses low, especially if you currently rent, which puts you at the greatest risk since future rents will continue to escalate as inflation goes up. Remember you will live somewhere, so why not own your own home instead of paying your landlord’s mortgage!
2) If I already have a home / mortgage and do not have an interest rate in at least the low 4s, it is important to refinance into a lower interest rate. Now a large percentage of homeowners do not have the equity to just refinance into a low rate, but the good news for you if your in that situation, new modifications to the “Making Home Affordable Program” or HARP as it’s known, will allow you to possibly streamline refinance into the low interest rates of today and lower your fixed housing expenses. You can read a past post (read post here) that provides a detailed questions and answers on this revised program.
3) Investments come in many shapes and sizes and if you are a person who has investments, you need to make sure your investments are at least growing at a faster pace than inflation or you are going backwards (true inflation is higher than the government’s published index) Owning real estate is and always has been a great long term investment, but like any investment buying or selling at the wrong time will be a bad investment. With the value corrections in the real estate market and the current record low interest rates, coupled with some unique opportunities in buying foreclosure properties (read post here) you can accelerate the growth of your investment portfolio or even allow you to buy your first home way below current market value, so you have built in equity from day one.
So with the tremendous turmoil in the world around us, another important thing you can do is build a surplus of non perishable foods and staples along with extra items you use every day in case of a natural disaster or a situation that cuts off the retail supply chain. Our whole national retailer supply chain, especially grocery stores is built on replenishing every 3 days, so if that supply chain is cut off for what ever reason, you want to make sure you and your family have what you need to eat and survive for at least 10 days or longer (in my opinion) Here is a good website that will give you ideas on what items to start stocking up on.
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