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Here are some of the changes in contributions and compensation
limits that are in place for 2006:

IRA Contributions:

For those eligible, the 2006 maximum allowable contribution for
a traditional IRA is $4000. This is the same for Roth IRA
contributions as well. If you are age 50 or over, the “catch up”
amount is an additional $1,000.

SEP Provisions:

For plan years beginning in 2006, the maximum compensation limit
moves from $210,000 to $220,000

Maximum SEP Contributions for 2006 increase to $44,000 from
$42,000, the limit in 2005.

Simple IRA Plans:

The non elective employer contribution wage base is $220,000.

Contribution limits for an employee remain at $10,000.

The “catch-up” provision for employees age 50 and over is $2500.
This is up $500 from 2005.

401(k) Contribution Limits:

For 2006 the elective employee contribution is $15,000. This may
also be subject to limitations under an employer plan. The
“catch-up” provision is $5,000.

Social Security Wage Base: The new wage base is $94,200 up from
$92,000 in 2005.

Annual Federal Gift Tax Exclusion:

Generosity increases $1,000 from 2005, with the new 2006
exclusion set at $12,000. In future years, this can again
increase for inflation adjustments but only in $1,000
increments. It probably safe to say we won’t be seeing any
increases for a while.

Federal Estate Tax Exclusion Amount:

This has moved from $1,500,000 in 2005 to $2,000,000 in 2006 and
will remain level through 2008. This is still a hot potato in
Washington, and what will eventually happen here is still very
much up for grabs.

If you have any questions or comments, Chip would love to hear
from you. You may contact him by email at
dahlkefinancial@sbcglobal.net. You may also contact him at the
Living Trust Network’s web site. Its URL is
http://www.livingtrustnetwork.com.

Copyright 2005. Living Trust Network, LLC. All Rights Reserved.

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The following situation happens quite often to many traders. Look it over and see if it has been happening to you:

You have been faithfully following your trading plan and the rules you’ve set for trading. By following them you are now in a trade that doesn’t look so good. At the same time, by following your trading plan, you see that you’ve missed a beautiful move in a different market, one that could have made you a lot of money.

You are in a bad trade and you’ve missed out on a great trade. You become disgruntled. You think to yourself that your trading plan must not be so great. You think there must be a better methodology that you should use that will prevent this from happening. You think to yourself, “Yes! That’s it, I’ll change the way I do things.” So you create a new rule or modify an old one so that such a rule would have let you capture the trade you missed and avoid the one you took. Have you been making this mistake?

Here’s another way it can happen: You are in a trade, and your rules cause you to be stopped out with little or no profit. Shortly after you exit the trade according to plan, prices take off and move to where, had you stayed in, you would have made substantial profits. The move leaves you sitting there thinking you are stupid. You reason that there must be something wrong with the way you do things.

Your rules, your plan, or both must not be right. So you change what you are doing, or make a new rule so that the next time this happens, you won’t be left behind.

You have just abandoned all of the hard work you’ve previously done that enabled you to successfully trade futures. You’ve abandoned your education and learning. You’ve abandoned the wisdom that will enable you to be consistently successful as a trader. You’ve just started trading history, and you are supposed to be trading on the future movement of prices. You are trading what happened, not what will happen. By not being willing to be left behind, you are setting yourself up for being left out.

If you’ve been having thoughts, or have been acting as we’ve just described, you have a terrible problem with greed. Why? Because greed can never get enough. You can’t satisfy greed. Greed wants more, and yet more.

Not every trade is your trade. Not every trade has to work out for you. You have to be satisfied with getting a reasonable share of trades that fit your description of a good trade. Some of those trades will turn out to be great trades, others are good trades, and a certain percentage of your trades will be bad. There’s no way around it.

Not every good trade will turn into a great trade. When you enter a trade according to your rules and trading plan, you have no idea whether or not it will turn out to be a good trade, much less a great trade. The reality of trading is that, try as you might, you cannot know the future.

Whenever we miss a big move and then try to find some pattern, indicator, rationale, or modification to make to what we are doing so that the next time we will not miss the “big” move, it is a part of the hunt for something magic - a continuation of our quest for the holy grail of trading.

What a terrible mistake to allow yourself to make. Winning as a trader consists of making some small profits and some larger profits on a regular basis. Obviously, there will be some losses. We regularly want to keep losses small, but there are times when a loss will get away from us and turn out to be bigger than desired.

If adversity causes you to become disgruntled, then you really need to examine your thinking and your approach to trading. Your trading plan must allow for disappointment and loss.

You’ve got to believe in what you are doing and be able to trade from the knowledge that when you follow your rules and your plan, you will make money from your trading.
When you become disgruntled and begin to change your plan, your rules, or both, you are setting yourself up for almost certain failure and the worst thing that can happen to a trader - you will lose the courage of your convictions. Without it you cannot trade with any level of confidence.

This is why we encourage you to write out the reasons and rationale for every trade you make, even if you have to do it after you have completed the trade. You must develop a keen recognition of the trades that are your trades. Write out your trading plan every day and for every trade you intend to make. If you did not have time to plan every trade, be sure to review those you did make without pre-planning. Then you can go back over your trading and be able to see why and when you are successful.

Reminder: Here are some steps to take before the market opens.

View major formations on the charts of those futures you intend to trade. View potential congestion areas, get the big picture from the longer term charts.

Write down all potential entries as you see them on the chart.

You need to go through this exercise every day that you trade. This takes discipline. However, doing so will help you develop the kinds of habits that will mold you into a great trader.

If you are too busy to be disciplined, then you are too busy to trade. If you don’t discipline yourself, you will soon disappear from the trading scene.

Joe Ross

Trading Educators Inc

ABOUT JOE ROSS:

Joe Ross has been trading for more than 47 years, and is a well known Master Trader. He has survived all the up and downs of the markets because of his adaptable trading style, using a low-risk approach that produces consistent profits.

Joe is the creator of the Ross hook, and has set new standards for low-risk trading with his concept of “The Law of Charts.” Joe was a private trader for most of his life. In the mid 80’s he shift his focus and decided to share his knowledge. After his recovery, he founded Trading Educators in 1988 to teach aspiring traders how to make profits using his trading approach. He has written 12 major books on trading. All of them have become classics and have been translated into many different languages.

Joe holds a Bachelor of Science degree in Business Administration from the University of California at Los Angeles. He did his Masters work in Computer Sciences at the George Washington University extension in Norfolk, VA. Joe still tutors, teaches, writes, and trades regularly. Joe is still an active and integral part of Trading Educators.

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Are you thinking of trading on the Forex money market? If you are new to trading it makes sense to deal in the more popular currencies. There are two main reasons for this. Firstly you do not want to be left with a currency where there is little interest and you may have difficulty selling. Secondly the spread between the bid/ask price is likely to be narrower, making it easier to make a profit.
There are seven major currencies, the US dollar (USD), Euro (EUR), Japanese yen (JPY) British pound (GBP), Swiss Franc (CHF) Canadian dollar (CAD) and Australian dollar (AUD).

The US dollar is the most traded currency followed by the Euro and the Yen. The Euro is the relatively new currency of the European Union although some member states, including the UK, have not changed their currency.

Obviously if you are buying a currency you must also be selling(using) another and therefore prices are always quoted in pairs, the USD/EUR being the most active. The more active a pair the narrower the difference between the bid/ask price is likely to be, with a possible spread of just two pips for the most actively traded. A pip is the smallest unit of price for a currency. Most currencies are traded to four decimal points after the first digit, so that a pip is 0.0001 or 1/100 of a cent. This may seem a minuscule amount until you realise that on a trade of $100,000 that is $10. As each trade involves both selling one currency and buying another, the difference in the spread is the cost of the transaction. If there is a 2 pip spread you must make that profit to break even. The exception to the four decimal points is the Japanese yen which is normally traded to two decimal points.

If you live in a country using one of the major currencies, when you first start trading it makes sense to begin with that currency. Not only are you familiar and comfortable with the currency, but you are in a better position to judge its strength. The internet has a wealth of information on the financial climate of a country, but if you live there you have access to all newspaper content, as well being in the unique position of experiencing first hand changes at the consumer level.

Trading on the Forex market is a high risk investment not suited to everyone. You can lose money as well as make a profit. Never risk more than you can afford to lose.

This article is for information only, any action you may take on the Forex money market is your sole responsibility and the author accepts no liability.

Margaret Tye runs the Forex Trading Articles website.
You are welcome to use this article as long as the author is acknowledged and a link to http://www.forex-trading-articles.com included.

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No one likes to think about divorce. That it happens means that
a very important part of one’s life did not go as planned. When
it does happen, however, there is absolute and immediate need
for a plan–divorce financial planning. While divorce is never
an easy process, effective divorce planning can mitigate some of
the pain and confusion involved that may affect you for the long
term.

Divorce proceedings and Marital Settlement Agreements (MSAs) are
often complicated. Drafting your MSA–the document that will
identify and divide affected property and outline provisions for
custody and child support–is a key step in any divorce, one
that many couples execute poorly. The repercussions from doing
so can affect you for the rest of your life. There are basic
steps, terms, and intermediaries that can help make your divorce
planning less stressful:

1. Self-help guides Some financial situations render legal help
unaffordable. There is plenty of literature available devoted to
divorce planning. Remember though, an MSA is probably the
largest financial transaction of your life–consulting someone
with education and expertise is advisable. 2. Paralegals While
they can file your divorce papers with a court, they CANNOT give
legal advice. 3. Mediators Attorneys, judges, or other qualified
professionals that work with couples seeking an out-of-court
settlement. Mediators do not go to court or handle litigated
matters. Check with your local Bar Association for a list of
Family Law Specialists and Mediators: a majority offers free
consultations (usually lasting 30 minutes). 4. Litigation
Attorneys Litigation attorneys help couples that can’t reach an
amicable settlement by preparing their case for a hearing before
a judge. 5. Certified Family Law Specialist An attorney who has
specialized education and expertise in family law–in many cases
such specialists are best when taking your case to trial. 6.
Certified Divorce Planners CDPs mediate the financial aspects of
an equitable divorce settlement, generally working in
conjunction with a Family Law Attorney. 7. Collaborative Law
Involves a team approach where two attorneys (one for each
party), two mental health coaches, and one financial advisor
assist in determining a settlement. All members of the team sign
a statement agreeing to work together in keeping proceedings out
of court and preparing an MSA that is fair for all involved.

MEDIATING * Mediated cases generally cost 10% that of litigated
cases * Mediated divorces are settled as quickly as an agreement
is established * In many states, divorces are final after a six
month separation period

vs.

LITIGATING * Litigated divorces usually require a starting
retainer of $10,000 * Eventual fees drive costs up by tens of
thousands of dollars * In-court divorce proceedings can carry on
for more than two years

Dividing assets is tricky territory as regulations vary from
state to state. Some states treat income earned during a
marriage as community property–regardless of who earned it.
Anything purchased with community property funds is owned by the
parties equally. In the event of a marriage dissolution, assets
are divided between the parties. The division that you should
seek should be the best one for both spouses–you may decide on
something other than a strict 50-50 distribution if it is better
for the family as a whole.

Retirement accounts can be kept by whomever’s name appears on
the account. If a couple prefers to divide a pension, a court
order called a Qualified Domestic Relations Order (QDRO) is
required to do so. Banks can transfer IRA account funds without
a QDRO.

The final, most stressful divorce issue involves the
determination of child support. Remember these primary
considerations:

* Spouse income * Percentage of time spent with children * State
and Federal taxes for each child * Health insurance costs for
each child

Child support is not tax deductible to the payer or taxable to
the recipient. California has a child support guideline that can
be determined by using any certified support calculation
software program. Computer calculations do not provide a ready
answer for spousal support or alimony. Alimony is based on the
needs of the supported party and the other party’s ability to
pay. Alimony is tax deductible to the payer and must be included
as taxable income on the recipient’s tax return. A combined
payment known as family support is treated the same as spousal
support. Obtaining a life insurance policy for both spouses (to
insure continuing support should a parent die prior to
completion of his or her support obligation) is also an
advisable step.

Never underestimate the decisions made while planning and
proceeding with your divorce–they will affect all aspects of
your life for years to come. Do what you can to make those
ramifications positive. There is so much to divorce than signing
papers and dividing assets. If “happily ever after” is not your
ending, a comprehensive understanding of your rights and
obligations can at least make it “happy after the fact.”
Education and awareness is key to making the most out a
divorce’s unfortunate circumstances.

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