"My people are destroyed for lack of knowledge."

Hosea 4:6

This short article will address the topic of

inflation, its causes, the effects thereof, and

how to safeguard against it.

Do not fall victim to inflation, i.e., the

government manipulation of your money. Let me

explain.

I. What Causes Inflation

Have you ever heard of the Federal Reserve? Well

then you know what causes inflation. The "Fed" is

the engine of inflation, by self-admission. But

There once was a hawk, ferocious and swift. He was young and agile with many years of life to hunt the open ranch lands. In a nearby field, a mouse scurried about the ground. The hawk saw the hurried motion and swept speedily toward the rodent.

Just as the hawk's shadow engulfed the smaller rodent, the mouse fell to its back and begged, "Please, Mr. Hawk, spare me my life!" This surprised the hunter and he landed beside the mouse.

"Why should I spare your life? I am hungry today."

Youve been thinking that your financial life could probably be better, right? Maybe you think, If I could just stick to a budget everything will be fine, or how about When I get that next raise or promotion, Ill have enough money to pay off my debts and save some money You may even be thinking,I can do this on my own!

I hear these comments and more on a regular basis. I usually say, Great! Can you think of any reasons your financial life isnt perfect right now?

Results from a new tool developed by UK based
firm, Lean Marketing, confirm a worrying trend.

When it comes to making money,
most of us simply don't have a clue.

The Wealth Audit asks 10 simple questions
to help you ascertain your financial position
and provides instant tips for improving things.

Since launching the tool on 29th July
the response has been tremendous.

Out of a total score of 100 the average
is just 46.9 which suggests people still
need to do quite a lot to be truly free.

The Survey Suggests:

The four main steps in building a wealth cycle foundation are:

Pay yourself first

Understand the legal entities available to you and the tax implications of each

Determine whether to be an active or passive investor and using the appropriate strategies

Develop and commit to your money rules

PAYING YOURSELF FIRST

When you purchased your home, you most likely got a fixed interest rate mortgage with a 15 or 30 year term. These are the most popular mortgages in the industry. Even in the summer of 2004, when the interest-only or simple interest mortgage loans became popular, the average American stuck to the fixed rate. You see, the fixed rate offers security to conservative people, and the average American home buyer and home owner is a very conservative person.

In todays unpredictable global economy, you obviously never know what is going to happen next. Uncertainties and concerns regarding the Iraqi threat, North Korean crisis, and hidden terrorist cells and networks continue to loom in the back of the minds of consumers. Moreover, the stock markets and industries around the world.

Now is a great time to make it a habit to manage your resources instead of your resources managing you. What is meant by that when we are stating that "Your money manages you"? Here is a well known example:

Estimated Reading Time: 4 minutes -- Envision your life 10 or even 20 years from now. Where do you plan to be? What are you doing and with whom?

Most of us between the age of 35 and 50 years hope to be retired to some degree in 15 to 20 years or less. We see ourselves living on retirement funds enjoying life and family. I have never had a client tell me they see themselves penniless or sick. Yet, these same clients fail to have a full plan.

The rewarding of high compensation packages to top executives who turned over weak quarterly earnings, or who were involved in corporate scandals, adversely affected short-term investing, and collectively contributed to the downturn of the global economy over the last couple of years. Even the help and expertise of Federal Reserve Chairman Alan Greenspan and several notable Nobel Prize winning economists in the Presidents Council of Economic Advisers, wasnt enough to revive the economy. September 11 then turned our attention towards terrorist threats against the markets.