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Life DilemmaLife is a dilemma. Things that we have, like our 401(k), IRA’s, investments and our house seem to be steadily going down in value as we sit by helplessly watching. Conversely, things that we don't have like food and clothing continue to escalate in price. It’s somewhat frustrating as we seem to be sucked into change events far beyond our control. But are they?

Some may say yes- those that are in the camp that feel that the decisions that are being made by big government and municipalities put us in a place of wait and see: it’s up to them. I disagree. By standing around waiting you are letting opportunity pass you by. Understanding the basic mechanisms of what causes specific situations create those same situations to be taken advantage of. For example: the market volatility. No longer is the US market an entity of its own. The global markets are tightly held together by a common thread: money. Currently we have been hearing about the problems in Europe: Greece, Ireland, Spain, etc. The banks in Spain and Greece as well as most of the European banks are tied to New York.  They loan money to companies in the US. If they go into default there will again be less money in the US for companies to expand and loan to small business as well as individuals like you and I. It’s a chain reaction of events which is global in nature, far above our heads. What can you do, you ask? Thanks for asking!

Keep contributing to your retirement plan. Each month you contribute while the stock market is down, stock and mutual funds in general are cheaper, depending on the funds you are invested in. Now, more than ever, is a time to open and review your statements. Take a look at what you are invested in, and do some homework. Look at the performance, and how you are allocated. Life is different now- it’s your job to watch your retirement account- nobody else is responsible but you. If you are feeling a bit queasy about the markets, perhaps you may choose to move into less volatile choices. Either way, keep saving- you can never go back in time.

Watch your spending, and look at your spending habits to see if you can reasonably cut down. Look at your utility carrier and your insurance expenses. Buy in bulk (Can you say Costco?) Think before you drive-you can pool your errands. Don’t stop living- just live more sensibly, for the time being. I know you’ve heard this all before, but how much action have you taken? Really?

Have you looked at the mortgage rates today? A 30 year is at average 4%, a 15 year at 3.5%. Can you believe it? Here may be your chance to cut your expenses and cut years off your payments at the same time. It’s like a gift from Bernanke!

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