Inflation Proof Your Investment Portfolio with ETF’s

Even though inflation has been relatively quiet in U.S. since late 1980’s, there now appears to be some strong evidence that it may be starting to heat up again with an expanding economy, combined with skyrocketing oil and housing prices in certain key regions of country. While Federal Reserve has been raising key interest rates citing threat of rising inflation, cautious message coming out from Feds are that, inflation is still benign and not yet a threat. Inflation is benign? Excuse me, but cheapest gas I can find anywhere in this area is $2.23 a gallon, which is up almost 50% from last year and housing prices in my Howard County, MD neighborhood have more than doubled in past five years.

Inflation should really be a major concern for all investors because it reduces value of their savings over time. History has also shown that traditional investment in financial instruments, such as stocks and bonds typically fare poorly in face of sharply rising inflation, as evidenced by savage decline experienced during last bout of serious inflation during 1970’s.

Fortunately for investors, there have been quiet a bit of improvements made in financial markets since 1970’s, and investors now have a great deal more options available to help protect their portfolio from scourge of inflation. One of best and easiest ways investors can diversify their portfolio is through use of Exchange Traded Funds, commonly referred to as ETFs. ETFs you might recall are similar to passive index based mutual funds, but they can be bought and sold in market just like stocks. There are currently more than 170 different ETFs (and still growing!) that investors can choose from, and these ETFs cover full gamut from domestic stock index to fixed income, international and even real estate and commodity related.

How to Maximize your Home Business Tax Deductions for 2005

Someone once said, ‘the best way to calculate your taxes is…Honestly’. For 2005, add ‘Smartly’ to that and you’ll get to keep more than you make. This April 15th is going to be day of reckoning for every taxpayer. If you are smart enough with your accounting and keep your eyes and ears open, this could be your favorite day of year. Take full advantage of tax deductions due you and you can come back richer from IRS office.

As a home business owner who has been keeping track of every dollar spent, you can make a killing on your tax deductions with these smart taxpayer tips.

1. Jot it all down: keep a track of all your business expenses. Maintaining timely and accurate records is something you’ll thank yourself for, this April. You don’t necessarily need elaborate documentation to do this. An easy and a very cost effective way would be to keep all your expenses jotted down in a diary. It is a good idea to collect evidence as well (in case IRS decides to do an audit later) like receipts, bills, and statements for cheque payments etc.

2. Shop for your taxes: this financial year you will have a choice to either deduct your state income tax or your state sales tax. Do some math and compare two to see which tax deduction is higher. Major purchases in last financial year should be crosschecked to see in which category they yield a larger deduction.

3. Itemize your deductions: Before you decide to settle down for standard deductions ($4,850 for singles and $9700 for married couples filing jointly), fill out Schedule A to see if your itemized deductions are larger than standard deductions. You might be in for a surprise. Consider itemized deductions in areas like: Home ownership, charitable donations, Medical expenses and miscellaneous deductions. According to IRS's most recent numbers, those filers who itemized back in 2002 deducted an average of $19,673 from their taxes