Come to think of it- I have noticed more pawn shops and "check-cashing" places around town.  Some of the new strip malls in town have big signs offering pay day loans or car title loans.   Apparently business in picking up.

Hard times in the US are benefiting pawnbrokers as beleaguered consumers pledge jewels, electronics and other goods in return for loans with interest rates running as high as 300 per cent a year.

“Brief and shallow downturns in the economy may benefit our business model,” said Daniel Feehan, chief executive of Cash America, the biggest US pawnbroker chain, with 942 locations.

Pawnbrokers offer loans in return for personal items. Customers can buy back their property for the value of the loan plus a fee, which works out to an interest rate that can reach 300 per cent on an annualised basis, according to the NPA. If borrowers do not pay off the loan in a given time, the unredeemed item can be sold.

The Fed cut interest rates again today.  Not so great if you're shopping for a CD or using money market accounts.  However I have a feeling a lot of people will start refinancing their homes. 

If you're buying a house for the first time- remember you can take up to $10,000 from your IRA without any penalty.  The $10,000 is still taxable.  IRS publication 590 will have complete information on the first time home purchase rule.

Okay, we've all heard the recession word over and over again this month.  Many analysts and economists are predicting one.  Many retirees have e-mailed us recently and mentioned downturns in their portfolio's.  It's probably  a great time to sit down with your financial planner and look at your investment strategy..especially if you're retiring soon or need to start generating retirement income.

Bush acknowledged in his State of the Union speech that "at kitchen tables across our country, there is a concern about our economic future."

"In the long run, Americans can be confident about our economic growth," the president said. "But in the short run, we can all see that that growth is slowing."

Beginning January 1, 2008, a plan participant may rollover directly from an “eligible retirement plan” account to a Roth IRA, subject to the existing limitation on Roth IRA rollovers. An eligible retirement plan includes a qualified plan, a 403(b) plan, and a governmental 457(b) plan. This law change was part of the Pension Protection Act.   Remember- it is a taxable event, any amount rolled into the Roth IRA account will be counted as income. 

Last year you were required to establish the traditional IRA first and then "convert" into the Roth IRA.

Make sure to consult your tax advisor and IRA custodian on this new regulation. 

Look at IRS publication 590 for more on this topic. 

Women's Institute For A Secure Retirement (WISER).  This is a non-profit group that focuses on some of the special issues that women face planning for retirement. Here's a recent publication.

What Women Need to Know About Retirement (Entire eBook)

Chapter 1 - Women and Retirement Income

Chapter 2 - A Lifetime Money Plan

Chapter 3 - Understanding Stocks, Bonds, and Investing in Financial Markets

Chapter 4 - Six Things You Need to Know About Social Security

Chapter 5 - Prescription for Your Health Care Future

Chapter 6 - Where Will Your Retirement Money Come From

Chapter 7 - When the Unthinkable Happens

Okay, here comes the economic stimulus.  If you've seen your retirement investments meltdown by thousands of dollars..I'm not sure this will be very exciting.

How big will my check be?
The proposed package includes up to $600 for single taxpayers and $1,200 for married couples, plus an extra $300 per child. Those who did not pay federal income taxes in 2007 are eligible for $300 per person or $600 per married couple as long as they earned more than $3,000 for the year. High earners are out of luck: The program will be phased out for single taxpayers earning over $75,000 and married couples earning more than $150,000.

When will I get it?
If the deal is approved quickly, people can probably expect their checks by July.

Do I need to pay taxes on it?
No. Rebates are a form of tax relief, according to a Treasury Department spokesman, so they are not taxable.

The reduction in the federal funds rate from 4.25 percent down to 3.5 percent marked the biggest reduction in this target rate for overnight loans on records going back to 1990. It marked the first time that the Fed has changed rates between meetings since 2001, when the central bank was battling the combined impacts of a recession and the terrorist attacks.

The Fed said it also was reducing its discount rate, the interest it charges to make direct loans to banks, by a similar three-quarters of a percentage point, pushing this rate down to 4 percent.

Commercial banks responded to the Fed's action on the funds rate by announcing similar cuts of three-quarter of a percent on their prime lending rate, the benchmark for millions of business and consumer loans. The action will mean the prime lending rate will drop from 7.25 percent down to 6.50 percent.

If you visit RetirementThink on a regular basis, you'll know Ben Stein is one of our favorite authors.  Here's the Ben Stein take on recession and Ben Bernanke.

I want to be honest here (and everywhere): This slowdown is happening faster and harder than I thought it would. I was too optimistic. My optimism was based on a belief that the Federal Reserve would act more aggressively than it has in fighting the slowdown. It didn't, and we're paying the price.

Let's hope that Ben Bernanke, the chair of the Federal Reserve Board, has learned his lesson. Hopefully, he'll now plunge in with both feet to get a lot of liquidity into the system, and reassure lenders that he'll backstop them and not let them fail. He's now perceived as weak, and he'll have to act aggressively to get the ball rolling again. But he can do it.

Rethinking The Recession at finance.yahoo.com

In 2006, 44.6% men age 65 and older received and annuity or pension income, with a mean (midpoint) amount of $17,200 per year.

Meanwhile, only 28.4% of women age 65 and older received an annuity or pension income in 2006, with mean pension income of $11,142 annually.

Courtesy of  InvestmentNews.com