“Real World” Personal Strategy Blog

What are YOU thinking?

“Promise me you’ll always remember: You’re braver than you believe, and stronger than you seem, and smarter than you think.”

- From A.A. Milne’s Winnie the Pooh

Last week, I touched a nerve (again). I gave you some hard numbers related to our current economic situation…and pointed out that if you compare where we are NOW, to where we were in the 1930’s (or even the early 80’s), things aren’t quite as bleak as we’ve been led to believe.

Now look…as I mentioned last week, I’m not at all denying that we’re in a deeply troubled and sick economy. In many ways, because of the global nature of this downturn, there is a fair argument to make that we’re facing a worse *worldwide* situation than we’ve ever faced.

But, as you and I both know…what matters most is the “local”.

And one of hallmarks of THIS climate is how closely-linked our situation can be tied to consumer behavior. This behavior has almost everything to do with the mindset of the general population, and right now…it ain’t great.

So, do you want to be a part of the solution? This week, in my Strategy Note, I’ve got some thoughts for you about how you can manage your mindset in this current economy.

Read on…and post your feedback!

“Real World” Personal Strategy

Your Mindset Is Everything In This Economy!

How can you maintain your sense of personal peace in this environment…while NOT simply “ignoring” everything? I’ve got four suggestions for you.

1) Firstly, DO be very selective about (even, yes, choosing to ignore) certain media elements that have an agenda of spreading fear. 24-7 news would make no money if it stopped preying on people’s fear. (You realize the news networks are not a public service, right? They are in the business of getting ratings to sell advertising. Period.)

Have you ever noticed your feelings after watching just 20 minutes of CNN Headline News? Everything is going to pot. You’ll find negative stories on the environment, war, disease, crime, and of course… the economy. It’s laughable what they’ll come up with just to broadcast some bad news. A few weeks ago I spotted this “headline” story on the tube along with some sad-faced puppies: “PETS: Feeling the Foreclosure Boom!”

Everyone is selling crisis! This is true, from the media to the politicians. So stop watching CNN all day, refuse to participate in this circus, and instead start planning your first (or next) million. Seriously.

2) Look for the good news. Now, I’m very careful here, because I’m aware that some of my clients and friends really are feeling the pinch, but let’s ALSO look at the bigger picture, especially in comparison to the early 80’s or 30’s.

This was the topic of last week’s post. Short version: We’re NOT in the Great Depression (by the numbers).

You can always find doom and gloom if you want to. So turn off your TV and focus on other activity. It will significantly help your inner peace!

3) Get out and do something profitable. That may mean actually starting that exercise regime you’ve been putting off. Take up a new hobby. ANYTHING to get your mind in a more “profitable” mode! Go do it.

These steps will NOT solve the problems in your wallet, and in the economy. However, how you choose to respond will affect your peace, and, actually…this WILL impact how you spend your money. Please, for your sake, tune OUT the fear, and tune IN to smart preparation.

4) Stave off fear by knowing actual numbers. A bit self-serving? Sure, but also grounded in reality. The great problems many businesses and families face when money’s “tight” is SIGNIFICANTLY compounded by not knowing. Any number of pessimistic scenarios play out in your head.

So here’s how to fix that. Sit down with an advisor, get the real facts-and if they’re bad, you can still come up with a plan. You’ll find that laying out action steps with somebody competent changes everything. Call our office or send us an email to schedule an appointment to lay out these steps with us.

To more of YOUR money in YOUR wallet!

Tax time is a breeze…

I’ve been going to Roger for over 12 years and can’t say enough good things about the service provided. Tax time is a breeze thanks to Roger and his professional and courteous staff.  I highly recommend using Menden Accounting and Tax to anyone.

Alison L

How Bad Are Things…Really?

“I have become my own version of an optimist. If I can’t make it through one door, I’ll go through another door — or I’ll make a door. Something terrific will come no matter how dark the present.”

- Joan Rivers

The way people are talking these days, we’re somewhere in between The Grapes of Wrath and the fall of Rome. Or worse.

And look–I’m not denying the very real problems in our economy right now, but as a financial pro, I often take solace by hunkering down and examining the real numbers behind a problem.

Yes, we’re in a recession. Yes, unemployment is up (and, I’m keenly aware that some of my clients and their friends are feeling this in a deeply personal way). Yes, the government is spending a bunch of our money…with results yet unclear, and in the future.

[By the way, here's a handy little article about the provisions of the stimulus bill which affect most Americans, like you and me: http://www.nytimes.com/2009/02/13/your-money/13money.html?ref=business]

But, I’d like to take a moment in my Strategy Note below, to point out some economic facts about where we really stand. I’m not so vain as to believe my little “shot” into the ether will entirely lift the sagging shoulders or skyrocket your consumer confidence…but again, there can be sanity in the real numbers, I’ve found.

So, read on…and send me your feedback!

“Real World” Personal Strategy

How Bad Are Things…Really?

There really is a lot of fear out there about our economic present…and future. Some of this has to do with all the talk flying around, from both the media, and by our government leaders.

And yes…things aren’t good. But they’re also not as bad as the 1930’s. Consider:

In the last year, we’ve lost 3.4 million jobs. That’s not a good number, of course, but is it the 1930’s? Let’s look deeper into the numbers… it represents 2.2% of the labor force. As a matter of perspective, from November 1981 to October 1982, 2.4 million jobs were lost — fewer in number than today, but the labor force was smaller. So from 1981-82 total job losses were 2.2% of the labor force…the same as today.

More historical data: job losses in the Great Depression were much, much worse. In 1930 alone, the economy lost 4.8% of the labor force (more than double what just occurred). In 1931, another 6.5% (almost triple today’s numbers). And then in 1932 it was even worse–7.1% additional unemployment. In the 1930’s, for three sustained years, jobs were being lost at double or triple the rate of 2008-09 or 1981-82.

And looking at the comparative, overall unemployment rates brings further clarity. Current U.S. unemployment is at 7.6%. That’s actually more than three percentage points below what it was in 1982 (10.8%) and not even a third of what we saw as a nation in 1932 (25.2%). Does it sound to you like we’re re-living the Great Depression yet? If anything, we’re re-living the early 80’s.

And there’s other numbers which flesh out the story: “Real” Gross Domestic Product (GDP) actually rose in 2008, despite a cruddy fourth quarter. The politically-neutral Congressional Budget Office projects a GDP decline of 2% in 2009. In 1982, the GDP contracted by 1.9%. But in 1930, the GDP fell by 9%, and in 1931, by another 8%, and in 1932, it fell yet another 13%.

When you look at other numbers, including auto-production, and other manufacturing indices, it’s even more stark. We’re not in a Depression, folks.

Now…all this doesn’t mean it’s inappropriate for us all to put our financial house in better shape. In fact, that’s exactly what I recommend. If you’d like to set up a special consultation to take a look at your finances, send me an email or call our office, and we’ll see what we can do to squeeze you in between our many, many tax appointments.

Next week, I’ll give you some tips on managing your mindset during this crazy time. You have a choice about how much fear you live with!

So, until next week…keep your head up!

To more of your money in your wallet!

Some “Economical” Love…

I find that the harder I work, the more luck I seem to have.
- Thomas Jefferson

This Saturday, there’s a certain holiday to attend to, and I thought I’d give you a little “nudge”. But, since I am a tax professional, after all–I’m going to give you some romance tips “on a budget”! Wives can scoff at this list, and be gratified when their husbands successfully surpass it. And husbands, well I know some are skilled at romance; and others … well, here’s some help!

“Real World” Personal Strategy
Love on a Budget
A Friendly Reminder and Guide To Creating Romance When Times Are Tight!

Alright, it’s no secret that our economy is in tough shape. And whatever your particular financial situation, wouldn’t it be great to create romance “magic” without spending an arm and two legs? So, instead of the tired old “flowers, candy and chocolate” [boring--and expensive!], here’s a few modest and occasionally tongue-in-cheek suggestions for a sizzling Saturday…that won’t torch your wallet!

Be Green – Save Money and the Environment at the Same Time!
With the economy taking its toll on virtually every industry, even the high-rollers are looking for ways to spend their cash more effectively. One Hollywood studio saved $40,000 on cards and postage by doing e-Cards and videos for all of their clients and friends.

Seem cheap?  Spin it this way – you’re being green by not using snail mail – that’s so 20th century anyway. You’re keeping with the times, utilizing powerful technology and reducing your “footprint” at the same time! What environmentally-conscious woman could resist?!

Make a Video.
You can use the video setting on your digital camera, and create a heartfelt message of love for your sweetie. Then, you can post it to YouTube, or another online video-sharing site and send it on! Um, just be sure to make that YouTube setting to “private” unless you want to share with the world your dying love for your honey (hopefully with clothes on!).

Learn a Romantic Song and Sing it to Your Sweetheart.
Well, I’m no singer, so I can’t say I’ve tried this…but I hear it works well. Even better, if you can’t sing, your valentine will give you kudos for the effort! You could step it up by writing an original song and then sing it. Or, for the slightly-less courageous, you could pull a page out of John Cusack’s book in Say Anything and hold a boombox (or iPod) above your head and blare Peter Gabriel’s “In Your Eyes”. That seemed to work.

Not a singer? More of a writer? Or artist? For the artistically and or musically inclined:

- You could pen a poem on nice paper
- or even paint it
- You can paint a picture of your honey. Just be sure it looks good.

The “Mix Tape” (or Playlist).
This is an old standby of high school kids everywhere. Except these days, the “tape” part is a bit less convenient. Instead, make a CD or mp3 playlist of Sweet Love Songs and make a cover list/ liner notes on the memories of you and your honey from the songs. And you can make a Personalized Photo Album using a service like Apple’s iBook service and iPhoto.

Romantic Picnic.
Surprise your love with a ‘picnic’ in the park, at the beach, or any other outdoor nature spot. If the weather isn’t ideal for outdoors, you could bring the outdoors inside -find a fake palm tree, flowers, sand, beach umbrella, radio, towels. Nothing says “I love you” like fake palm trees!

Write a Message To Be “Stumbled Upon”.
Well, perhaps not *literally* stumbled upon, but try a nice outdoor surprise. If you do have snow outside, you could stomp out the message and fill in the letters with spray paint or flower pedals or rocks.  If there’s no snow, you can use sidewalk chalk to write a message to your sweetie.

You see, anybody can go out and “buy something” – but it takes effort and thoughtfulness to make it personal…and it doesn’t require a lot of money!

Hmmm… perhaps I should limit myself to my true area of expertise–helping you keep the most money in your wallet as allowed under our current tax code! After this week, I’ll leave the romance to the other “experts” out there.

To love and low taxes!

Keep up the good work!

For the past three years you have provided me with exceptional service wouldn’t think about going anywhere else. When I have a question, it’s answered, when I’ve needed something it’s provided in a timely manner. Your staff is friendly and knowledgeable. Keep up the good work!

Sincerely,
Laura N.