YodZiaN

Think Ritch NO, my spell check is not broken. You should always be thinking richly, and occasionally you should visit the archived newsletter section of the invest-org-au website. There you will find a wealth of information, ramblings and also be able to ?back trade? to see how much money my previous ingenious tips would have made for you?

With the above, the ?Think RITCH? refers to a little acronym for ?Refund of Imputation Tax Credits?. Even if you are NOT a tax-payer, if you receive a pension or benefit that is tax-free, you can still get extra RITCH. If you do NOT submit a tax return, you can still lodge a single page RITC form to the Australian Tax Office and you can get FREE MONEY (a refund of your imputation tax credits. This is because Australian companies usually pay tax on their profits before they pay the shareholders. Often they pay more tax than you would, and as an owner, you can ask for this back).

Note that it is nobody?s job to tell you this? If you are entitled to get money back from the Australian Tax Office, do not expect them to call you and say ?Ah, we have $945 of your money, would you like it back?? It is NOT gonna happen. Do not wait for the ATO to call you. Do not expect your accountant or Financial Planner to call you and tell you (unless they are REALLY nice and good at their job).

It is up to you to ask for the money. To quote Jesus out of context, ?You have not, because you ask not?. Pensioners, self-funded retirees and any of those who earn less than $60 000 could definitely benefit from ownership of Australian shares and/or managed funds. Check with your accountant or call the ATO regarding RITC. Invest five minutes of your time and as little as $500 of your money to benefit twice (the investment could make you money, plus the ATO gives you money when you fill in the RITC form). Call your favourite investment adviser or Financial Planner to find out more. Keep Thinking RITCH?

Australia, you?re moving on up. Sometimes they report boring things on the financial news (OK, most of the time), and it seems boring because they use jargon and you don?t know what it means, or how it impacts you. National Accounts Surplus is up; is that good? Foreign Accounts Deficit is down; is that bad? Balance of Trade Figures ascendant; is that a rock band?

Ignoring the jargon of GDP and import/export figures, just try to think of Australia as a business. The business buys things, and sells things to other people. A business such as ?Beds R? Us? may buy timber for $20, turn it into a bed (paying the tradesman $10) and then sell the bed for $50. This means that they made a profit, and will probably make a larger profit the next year (because with more profits they can buy more timber and employ more staff), and they will probably continue to grow.

In the last decade, the cost of manufactured goods (such as cars, clothing, cameras, TVs and DVD players) has actually fallen; quite dramatically in the last few years. (Are you old enough to remember when the cheapest new car was around $30 000? Now they can make a brand new car for $13 000. Remember when digital cameras and DVDs were over a thousand dollars? Now they sell them in the grocery stores!)

Australia buys a lot of manufactured goods. Over the same timeframe, the cost of raw materials (coal, oil, gas, steel, wheat, cattle, aluminium and gold) has risen, again quite dramatically in the last few years.

Thinking again of Australia as a business that buys and sells things, that puts us in a good position. We are buying things for less, and selling things for more. China is paying more for our oil and cotton. We are paying the Chinese less for the toys and clothes. Australia is turning a profit!

For most of our short (two century) history, Australia has seen its ?terms of trade? (what we buy compared to what Read more…

May sales of new homes came in lower than any month on record, as tax credits for home buyers expired. The news is a troubling first sign of how the housing market will fare now that the tax credit program is over. The credits actually came to an end on April 30th, when potential buyers were required to sign a purchase agreement by in order to qualify, though they had until May 31st to close.

Sales in May came in at a seasonally adjusted annual rate of 300,000, which is the lowest the number has been since such records were first complied back in 1963. It also represents the largest one month drop in home sales pace in history. Analysts, who had been predicting the drop, were amazed at the size of it. Analysts had projected a sales pace of slightly over 400,000. Sales are now almost 80% below the peak set in July 2005.

The tax credit program offered $8,000 for first time buyers, as well as a $6,500 credit for existing homeowners wanting to move up. All four regions suffered a drop in sales, from a whopping 54 percent in the West to 34 percent in the Northeast, to 25 percent in the South and the Midwest.

Also hindering a housing recovery is the drop in new home construction. The number of new homes on the market in March fell to 215,000…the lowest total in almost 40 years. With the sluggish pace of sales reported for May, it would still take 8.5 months to exhaust the diminished supply, compared to about 6 months for a healthy market.

Meanwhile, prices dropped as well. The median sales price for homes in May was $201,000, a nearly ten percent drop from May 2009 and about 1 percent down from April. New homes accounted for about 7 percent of the total market, compared to about 15 percent before the housing crisis started. The lull in new home sales translates to a lack of job growth in the construction industry, which is normally a driving force of economic recovery.

When a new home is built, three new jobs are created for a year, on average; and about $90,000 in local and federal taxes are generated. The housing market has a significant impact on multiple industries, from manufacturers of appliances and materials to lumber yards.

The real estate market is still suffering and even though there is cause for hope, it still looks like we are years away from a recovered market. That is bad news for people who overpaid for their house or have lost their jobs in the past few years. If you are struggling to pay your mortgage bill every month it can ware you down and put a lot of stress in your life. There is some good news finally though, President Obama is offering aid that will help certain people fight off foreclosure. This new program assists those who are struggling to make their monthly payments, but still finding a way to do so.

It has received a lot of criticism of late because it does not help those who are falling behind and paying late, but that his because those people are already able to get aid with their lender. It is the people who are still paying on time that are in a way penalized because their lenders do not seem them as a foreclosure threat. That means they are unable to get their loan adjusted and they have to continue to struggle financially. The new policy allows them to adjust their loan either with lower interest rates or lengthening the term of the deal so that the monthly payments will go down significantly.

With payments down by hundreds of dollars each month, the hope and goal of President Obama’s foreclosure program is that people will not only be able to pay their mortgage on time easier, but they can use the extra savings to get out of any other type of debt. Some people are worried because this policy will lower your credit score which can have a huge impact on our daily lives but that can be fixed with credit repair. Credit repair can fix your numbers for you in a matter of weeks and at a cheap price.

Commercial real estate is much different than residential because you are not facing the same situations. With residential you have an easier time of renting, property values going up, and eventually even selling for a solid profit. Also remember that when you own a home you are relying on yourself to pay for it, not for a small business in a weak economy. There are fewer people interested in buying a commercial property, and that means less people to drive prices up.

If you have an unstable business you are putting a lot of responsibility on it not only surviving but also thriving in one of the worst recessions this country has seen. Renting really does seem to be the way to go right now because if your business has any problems you can move without worrying about selling. Renting allows you the quick and painless escape that you might need in that situation. However, if you were to think aggressively, right now is the best possible time to buy a building. The prices are still low along with interest rates so you can get a great deal.

If you do decide to buy and your company eventually does go under that does not mean you are in trouble with the property. Because you own it you can rent it out to another company and their payments each month will cover your loan payments. That is a big deal because that will increase your profits on the property and buy you the time you need to wait to find a good buyer. Regardless of your decision to buy or sell you need to make sure that you strengthen your credit score with credit repair. A good score will allow you to get the place you want if you are renting, and it will save you a ton of money each month on loan payments if you are buying. Credit repair can strengthen your score in a matter of weeks so that you are able to take advantage of it.