10 Sweet Ways to Say "I Love You" -- on the Cheap by Candace Bahr, CEA, CDFA and Ginita Wall, CPA, CFPreg; www.WIFE.org www.MoneyClubs.com Leave him a love note in his lunch box. Put wildflowers for him on the breakfast table. Call him at work and tell him to come home for an emergency--you. Show up at his work with a picnic lunch in hand and a private spot in mind. Don't ask him to do a single thing around the house for an entire week. Wow! Write 30 reasons why you love him on 30 different pieces of paper, one for each day this month. Meet him at a bar and flirt. Take him out for ice cream. Go out together, alone, for a long walk or to see the sunrise or sunset. Say those three little words: "I love you." Just do it. Cofounders sixteen years ago of the nonprofit Women#146;s Institute for Financial Education ( www.WIFE.org ) and the new MoneyClub for women ( www.MoneyClubs.com ), Candace Bahr, CEA, CDFA and Ginita Wall, CPA, CFPreg; are trusted financial guides for millions of women. As owner of her own investment management firm, Candace was recently recognized as one of the top ten brokers in the country for 2003 by Registered Rep magazine. Ginita has been named to Worth magazine#146;s Top Financial Advisors for seven years. Both authors are nationally-recognized experts on women and money and regularly appear on CNN and CNBC and in national financial and women#146;s publications. This article is excerpted from their new book It#146;s More Than Money#151;It#146;s Your Life! The New Money Club for Women (John Wiley, 2004). Permission granted for use on DrLaura.com. More >>

Cutting College Costs by Candace Bahr, CEA, CDFA and Ginita Wall, CPA, CFPreg; www.WIFE.org www.MoneyClubs.com If you have children, chances are that providing a college education for them is high on your list of goals. With the cost of tuition, fees, and room and board for four year at a private university averaging $108,000 and state school costs averaging $42,000 for four years, it#146;s no wonder parents are in a cold sweat. Those figures can really hurt your pocket book. At this point, you might be saying, #147;Why bother? I#146;ll never be able to save enough.#148; But ignoring the problem won#146;t make it go away. There are lots of ways you can conquer the education cost woes. Here are a few: There is $100 billion of financial aid distributed to students in the form of loans, scholarships and grants each year. Be sure you get your share. Many scholarships are not based on need. For example, merit, athletic, and music scholarships are often available to students who excel in those areas. Apply to a variety of colleges. Aid packages can vary significantly from school to school. Negotiate. If you are not satisfied with the aid package a school offers, talk to the university. Start your child at a community college. Two-year colleges are a lot cheaper than four-year universities, especially since most students live at home while attending. First, however, your child should determine which four-year college he/she will transfer to and make sure that all credits from the community college are transferable to the four-year college. Encourage your child to accelerate his/her studies by taking some summer classes or extra credits throughout the year. It#146;s possible to finish a four-year degree in three years. That means considerable savings for you. Take advantage of the latest tax breaks. The Hope Credit gives you a 100% tax credit for $1,000 of tuition and fees for junior#146;s first year of college, and 50% of $1,000 for the second year. The Lifetime Learning Credit gives you a 20% credit of up to $10,000 of tuition for you or your child. There are income limitations, so be sure to check with your tax advisor to see if you qualify. The best thing to do is plan ahead. Remember, with financial aid and scholarships, and plain old working-your-way-through-college, the costs don#146;t have to bury you. Cofounders sixteen years ago of the nonprofit Women#146;s Institute for Financial Education ( www.WIFE.org ) and the new MoneyClub for women ( www.MoneyClubs.com ), Candace Bahr, CEA, CDFA and Ginita Wall, CPA, CFPreg; are trusted financial guides for millions of women. As owner of her own investment management firm, Candace was recently recognized as one of the top ten brokers in the country for 2003 by Registered Rep magazine. Ginita has been named to Worth magazine#146;s Top Financial Advisors for seven years. Both authors are nationally-recognized experts on women and money and regularly appear on CNN and CNBC and in national financial and women#146;s publications. This article is excerpted from their new book It#146;s More Than Money#151;It#146;s Your Life! The New Money Club for Women (John Wiley, 2004). Permission granted for use on DrLaura.com. More >>

Comparing Options by Gary Foreman The Dollar Stretcher www.TheDollarStretcher.com I would like to know if it would be unwise to stop my 401k contribution for the next 1 1/2 to 2 years and use the money instead to pay off unsecured debt and student loans? After I pay my bills each month and allocate budgeted dollars for groceries and gas, I'm lucky to have $50 leftover for debt repayment or savings. About $400/month goes into my 401k, and it is currently valued around $40,000. I'm 29, married (stay at home spouse), and have a 15 month old daughter. We really want to get out of debt quickly, I estimate that my regular monthly payments, plus a booster payment of $400/month will pay it all off in 2 years. After that, we want to own at least 75% of our home in 10 years (we have a 30 year mortgage). Amy We will all face questions similar to Amy's. And sometimes it seems like we're trying to compare apples to oranges. It's hard to even know where to begin. On a basic level, she's right that the first step to a good financial future is getting out of debt. Even if that means delaying saving for retirement. Paying interest on borrowed money will make it harder to accumulate assets. That's not to say that she shouldn't save any money for retirement until all of her debts are paid. But paying off high rate credit cards should be a priority. There is some risk to paying off debts first. Some people are perpetually in credit card debt. And if they wait to save for retirement they might never get started. But Amy appears to have the necessary discipline to pull it off. A second way to look at the question is mathematically. Often that's the best tactic. The trick is finding a way to compare the different options that you're considering. In this case Amy is really asking about her net worth three years from now. Remember that increasing assets or reducing debts improves your net worth. She can use one of the calculators that are available to determine what will happen to the two accounts under different circumstances. One of my favorites is at Bankrate.com . Her goal is to figure out what the amount due on her credit card and what her 401k balance will be in 3 years. Amy will be creating two different scenarios. In one she'll stop contributing to the 401k and use $400 to pay off debts. In the other, she'll continue to contribute to her retirement and only pay off $50 per month. Try to make the comparison as neutral as possible. The assumptions that you make in creating the examples can predetermine the outcome. Especially in longer time periods. To really do it right, she should take the balances under each scenario and calculate what her net worth would be. If that's too complicated, then simply compare the amount of debt paid off vs. the amount her 401k would increase. Even if she doesn't have access to a computer a simple comparison can be created using a calculator. To estimate how much debt is to be paid off she'll need to create a list with 4 columns. The first column is for the beginning credit card balance. To that she'll add the second column which shows the amount of interest owed for that month. She can calculate that from the amount owed multiplied by the annual interest rate being charged divided by 12. From that total she'll subtract column three which is the amount of the payment for the month. The result is column 4 - the ending balance. Which naturally is the beginning balance for the next month. A second table can be created for the 401k plan. The first column is for the beginning balance. To that will be added the second column (investment earnings) and the third column (new contributions). The total will be the ending balance in column 4. And, once again, the ending balance from one month will be the beginning balance of the following month. Don't forget to include any employer matching contributions. They can make a big difference in your account growth. She can compare the results to see which would work better for her. One other thing for Amy to consider. Both of her choices are good. One might be slightly better than the other. But either one is better than doing nothing. Doing nothing is the worst choice that she could make. Gary Foreman is a former financial planner who currently edits TheDollarStretcher.com website and newsletters. You'll find thousands of articles to help you stretch your dollar and your day! Permission granted for use on DrLaura.com More >>

Enough Auto Insurance? The Dollar Stretcher by Gary Foreman gary@stretcher.com How do you figure out how much car insurance you really need???? I would appreciate any help in this area. Thanks. Debbie Debbie asks a good question. If you buy too much auto insurance you're wasting money. But if you buy too little, you could have a very serious problem down the road. And, to complicate matters, the answer isn't the same for everyone. Not only will our need for insurance change as we acquire wealth, but even the value of the car we drive makes a difference. Let's begin by understanding the purpose of insurance. And that's to pay for financial commitments that you can't handle yourself. In this case, commitments that come from accidents involving your car. Generally drivers must be able to pay for any losses that they cause others while driving their car. Since the potential amount of damages is greater than most drivers assets, they use insurance to make up the difference. Let's start by examining the types of dangers car owners face. The most obvious one is to our car. The second would be to our health and the health of our passengers. Finally, an accident could put our money at risk. The first priority is to protect our car. If you lease or finance your auto, you may be required to carry collision and comprehensive coverage. Collision pays for damage to the vehicle caused by your car running into another car or object. A simple definition of comprehensive is that it covers things that aren't caused by a traffic accident. Things like theft and fire. How much coverage does Debbie need? She'll need to choose a deductible that's low enough so that she can afford to pay it. And, she'll need enough collision to cover the balance of the value of the car. The best way to reduce the cost of auto insurance is in the collision and comprehensive coverage. If Debbie hasn't built up her savings, she'll probably need to have a low deductible. But if she's able to put a few extra dollars in savings, she could raise the deductible and make a serious dent in her insurance bill. As Debbie accumulates more savings, she'll get to a point where she could replace the car all by herself if she had an accident. At that point she may decide that she doesn't want to carry collision at all. Next Debbie will need to consider what insurance she needs to protect her wealth. Remember that by owning a car she's agreed to be responsible for any damage that it causes. Liability coverage pays for damage that you're responsible for and have caused to other people or their property. If her life savings is only $300, then there's not much a lawsuit could take from her. Some would advise that she should only buy the minimum liability coverage required by the state. But Debbie might be uncomfortable with that. Not having enough coverage to help a child crippled in your accident might not be something that she'd want to live with. As Debbie accumulates wealth her need for liability coverage becomes more important. She wouldn't want a lifetime of savings to be wiped out in one accident. Fortunately, increasing her liability coverage is not that expensive. In fact, many people purchase a 'liability umbrella' that kicks in when your auto liability limits are reached. Implied in Debbie's question is how to control the costs of auto insurance. At a minimum, she will need to buy the coverage that's required by her state. The most common requirements are liability and no-fault coverage. Raising her deductible on collision can do a lot to reduce her bill. And, if she's driving an older car, she may be able to go without collision coverage. No sense paying $1,000 a year for insurance to cover a car that's worth $1,200. Naturally she'll want to compare costs between different companies. Just make sure that everyone is quoting the same coverage. Debbie may also qualify for some discounts. A safe driving record, a car alarm or multiple car discount could help. Using the same company for your home or recreational vehicles (boats, RV's) might also cut her bill. Don't be afraid to talk with your agent. Each state has it's own laws. And insurance terms can be confusing. So don't be afraid to ask questions now. Not only could you save money today, but it's too late to change your policy after you've had an accident. You might find that you've purchased the wrong coverages. Gary Foreman is a former purchasing manager who currently edits The Dollar Stretcher website and newsletters. They've been helping people save time and money since 1996. Permission granted for use on DrLaura.com More >>

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How to Manage Money-Together by Candace Bahr, CEA, CDFA and Ginita Wall, CPA, CFPreg; www.WIFE.org www.MoneyClubs.com "When people argue over money, the argument is likely to have little to do with money. It almost always has to do with issues of control, security, self-esteem, and, above all, love." --Grace Weinstein, authorIn our lives, we are pulled in many directions. We both desire and fear the power of money, and most of us have problems harnessing the positive power of money through regular saving and investing. But that doesn#146;t have to hold you back. Here are ten things you and your spouse can do to foster good money management habits and get your savings on track. Decide together what you want. Many people live from day to day. Unfortunately, they also spend from day to day and build no financial nest egg to see them through. To make progress in saving for the future, approach the future one step at a time. Begin by establishing some short-term financial goals: a vacation next summer, or a new car the year after that. A desirable short-term goal can be the carrot-on-a-stick encouragement you need to start a savings plan and take additional steps toward financial security. Build for your future together. As children, we learned about Cinderella, Snow White, and Sleeping Beauty, who were saved from peril by their charming princes and lived happily ever after. As adults, we all entertain the fantasy of financial rescue at some point in our lives. That#146;s why lotteries are so compelling, despite the odds. Although the fantasy of financial rescue is entertaining, it can become a barrier to accomplishment. Take serious steps toward providing for your own financial future, beginning right now to create goals based on your current income and financial situation. If your fantasy comes true, so much the better, but if it doesn#146;t, the two of you will have done what was needed to take care of yourselves financially. Make a financial commitment to each other and your marriage. Many people tell themselves that they will begin to save when their income rises, but few ever do. Unless you put yourself first, when you make more, your expenses will inevitably rise to meet your income and nothing will be left for you. Persuade yourself that you deserve to keep a portion of your income for you and your future. Once you truly believe that, make a commitment to set aside 5 or 10 percent of all the money you receive in a special account that#146;s just for you. Just as some people tithe to church or charity, so should you tithe to yourself. You#146;re worth it. Learn about your finances together. Most people learn little at home or in school about money, investment, and personal finance, and those people rarely seek formal training in finance as adults. Begin by learning about your personal income and expenses. Find out where your money goes by tracking last year#146;s expenses, and then decide where to trim. Here are some spending guidelines: 35 to 40 percent of your take-home pay is probably spent on housing costs 10 to 15 percent goes for food Your car payments shouldn#146;t exceed 10 to 15 percent of your income Another 15 to 20 percent might be spent on variable expenses, such as household repair, recreation, and clothing 5 to 10 percent of your budget should go for insurance premiums and property taxes 5 to 10 percent of your income should be deposited to your savings. Start right now. Procrastinators put off saving, or go on spending binges as soon as they accumulate much of a nest egg. To overcome financial procrastination, begin by setting some minor goals, such as reading one article or newspaper column a week on financial maters, then add more substantial goals, such as devoting three hours to preparing a budget and an hour or two a month to monitoring spending. Work together to develop financial knowledge and confidence, and soon you will find yourself gliding painlessly into the world of finance, and you will be ready to begin your savings plan. Explore your money issues together. Carefully examine your early teachings about money to see if you can find clues that are sabotaging you financially. As a child, were you taught not to envy those who were better off? Did you family teach you that money is the root of all evil? Was money used to reward or punish in your family? Did you have enough, or were you constantly afraid? As you work to build a financial future together, it is important that you each understand your deep-rooted attitudes toward money, and the attitudes of your partner. That will reduce conflicts over money matters, and help you succeed financially. Balance the financial power in your relationship. Women are sometimes balanced between wanting the right to control their own lives and make their own choices, and the need to rely on others and be comforted and loved, and to provide a nurturing environment for their families. Men are confused as well. They have been raised to show love and affection through providing financial support. If a woman does not need financial support, some men are in a quandary: What do women want from them? Yet if their partner wants to quit her job to take care of the family, they are afraid she#146;ll become too dependent on him, and he#146;ll sacrifice his freedom. Discuss together the roles that each of you will play in earning, managing and spending money. Talk about how you each feel in the roles you choose, and how money affects your relationship. Don#146;t shy away from discussing the power and freedom that money brings. Discussing money matters openly will help foster a healthy relationship you both can cherish. Take action, one step at a time. Some people have no interest in dealing with their personal finances. They know little about money, and find the subject uninteresting and boring. To deal with money matters when you haven#146;t the time or interest, break your financial tasks into manageable portions. For example: if your goal is to amass $1 million, it may seem overwhelming at first. But though $1 million sounds like a lot, it#146;s really just $1,000 multiplied by 1,000. If you could save $1,000 a thousand times, you#146;d be a millionaire, and it is even easier than that, because money begets more money through compounding. As you seek out ways to create your nest egg $1,000 at a time, you will become more familiar with the world of money, and that will make it more interesting as well. Understand the risks and rewards of the Money Game. Did you play Monopoly as a child? The grown-up money game, Working-Investing-and-Retirement, is a lot like Monopoly, but the stakes are higher. Most people play the real-life money game too conservatively, even if they were risk-takers in juvenile games. Others are too aggressive in real life, investing in outlandish get-rich-quick schemes. Risks and reward work in tandem: the greater the risk, the greater the potential reward. Assess your personal risk tolerance and follow your intuitions. By learning about investment risk and reward, and combining that knowledge with basic intuitive skills, you can invest wisely for your financial future. Accept your imperfections, and those of your partner. Some people want to pin down every detail before making any decision about money. But perfectionism delays financial success. Emphasize action: Don#146;t wait until you are fully educated in finance to start saving, or you will never begin. Begin saving now, then start an investment program using mutual funds. Making financial decisions creates the possibility of mistakes, it is true. But fortunately, in most financial situations, there are a wide range of right decision and only a narrow band of decisions that are decidedly wrong.You don#146;t need to know how to pick the exact right investment, only how to avoid those that don#146;t suit your financial needs. Cofounders sixteen years ago of the nonprofit Women#146;s Institute for Financial Education ( www.WIFE.org ) and the new MoneyClub for women ( www.MoneyClubs.com ), Candace Bahr, CEA, CDFA and Ginita Wall, CPA, CFPreg; are trusted financial guides for millions of women. As owner of her own investment management firm, Candace was recently recognized as one of the top ten brokers in the country for 2003 by Registered Rep magazine. Ginita has been named to Worth magazine#146;s Top Financial Advisors for seven years. Both authors are nationally-recognized experts on women and money and regularly appear on CNN and CNBC and in national financial and women#146;s publications. This article is excerpted from their new book It#146;s More Than Money#151;It#146;s Your Life! The New Money Club for Women (John Wiley, 2004). Permission granted for use on DrLaura.com. More >>

It's About Time The Dollar Stretcher by Gary Foreman gary@stretcher.com Does anyone think that $20,000 will buy a new car forty years from today? Maybe it's time for an article on the time value of money, accounting for inflation in long term investment plans, and related issues. Lester Lester was referring to an article that I had written saying that when you buy something today, you're agreeing not to buy something more expensive later. And, he's right. You can't simply take today's prices and expect them to be valid for future purchases. Especially if you're look more than a few years into the future. The concept of rising prices is only one component of an economic theory called 'the time value of money'. It's a theory that we see every day but don't typically give any thought. The basic statement of the time value of money is very simple. A dollar today is worth more than having one tomorrow (or next year). Having money over a period of time is valuable. Money can earn more money. Suppose that you had $100 today and could earn 10% on it. A year from now you'd have $110. In two years $121. So having that $100 is valuable. Also, I'd rather have $100 today than wait and get it tomorrow. I won't earn much interest in one day, but it should be worth a little more tomorrow. It's also safer getting it today. There's always that possibility, however small, that you won't get the money tomorrow. By getting it today you've eliminated that risk. Lester points out another area where the time value of money applies. That's in the area of retirement planning. Suppose that you expect to retire in 20 years. You know that prices will rise before then. But can you estimate by how much? A quick and easy way to answer that question is to use the rule of 72. The formula is easy. The number of years in the future times the interest rate you expect equals 72. That's how long it will take for prices to double. Let's do an example. You want to know how long it will take prices to double if inflation is 6%. A little algebra tells us that you divide 72 by 6. Prices will double in 12 years. So if you expect to retire in 20 years and inflation is 6%, prices will be nearly 4 times higher when you retire. ($1 x 2 = $2 in 12 years. That $2 x 2 = $4 the next 12 years. Or 4 times in 24 years). If you play with the formula you'll find that the rate of interest you choose makes a big difference in the results. For instance 3% inflation would mean that prices would double every 24 years. Quite a difference compared to going up 4 times in the same amount of time. You can also use the same formula to calculate how long it will take your money to double in an investment account. For instance, if you're earning 9% it will take 8 years (9 x 8 = 72). You may want to get more precise than our little formula will allow. For that you'll need something called a financial function calculator. It will do a lot more than time value of money, but it's easy enough to learn how to use it for time value questions. And, they're not expensive. Some people will subtract the inflation rate from their investment return to get a 'real' rate of return on their retirement savings. For instance, if you earned 8% on the money and inflation was 3%, you've really gained 5% in buying power. Another application for time value of money is when you're trying to decide which payment plan you'd prefer. What happens if you were told that you could buy a car for $20,000 cash today. Or you could make $400 payments for 60 months. Or you could put $4,000 down and make $375 payments for 48 months. You could add up all the checks you would write. And that would be a good rough estimate. But you'd get a more precise answer by using a calculator to bring everything back to today's dollars so that you'd have a fairer comparison. Don't be intimidated by the concept. Just remember that having $1 today is more valuable that having one a year from now. And the same holds true is you're paying. A dollar that you pay today is more valuable than one that you'll pay next year. With an understanding of the time value of money and the ability to use the rule of 72 you can help yourself in a variety of common money situations. Thanks to Lester for suggesting it. Gary Foreman is a former financial planner who currently edits The Dollar Stretcher newsletter and website TheDollarStretcher.com You'll find hundreds of articles to help stretch your day and your dollar. Visit Today! Permission granted for use on DrLaura.com. More >>

Grocery Savings Made Easy By Tawra Kellam www.livingonadime.com For many people, making the decision to switch from two incomes to one can be a scary experience. They know they're spending too much, but don't know where to begin to cut back. Most people don't think they can live the frugal life and still be comfortable. I feed my family of 5 on $175 month. In 5 years my husband earned an average of $22,000 per year. In those 5years we paid off $20,000 debt. There are countless ways you can cut, but if you are a frugal beginner, try these simple suggestions from Not Just Beans for saving on your food bill first. Before you shop, take a tour through your pantry and your refrigerator. Be organized! Don't buy what's already hiding in your kitchen.If you're a fan of coupons, remember this: It#146;s not what you save, it#146;s what you spend. If you save 30 cents on something you wouldn#146;t ordinarily buy anyway, you haven#146;t really saved anything. A typical fruit item is significantly larger than one serving. Most people would be just ashappy eating a small apple as eating a large one so buy smaller fruits! This month, try two meatless meals a week (or one, if you're a diehard meat fan). Use meat as an ingredient instead of a main dish. A good recipe for this is Green Chile. It uses only frac12;-1 pound of pork. Cut back on the juice and milk. Use the money you've saved from eating less meat and drinking less juice and buy something that's on sale. Those sale items will help you cut back even further next month. In staying at home, it's the little things that add up so start small! Green Chile frac12; 1 lb. pork roast, or chops cubed into small pieces 10 frac12; oz. chicken broth 1 onion, finely chopped frac14; #150; frac12; tsp. garlic powder 1 can (7 oz.) green chiles, diced frac14; jalapeno, finely chopped 1 tsp. salt 2 Tbsp. flour, dissolved in water white flour tortillas Toppings cheddar cheese, gratedlettuce, shreddedtomato, sour cream Simmer pork in broth on low for 10 minutes. Add all other ingredients except flour and simmer 45 minutes. Thicken with flour so it is like a thick soup. Spoon about 1/4 cup into the center of a flour tortilla. Roll up tortilla and top with more green chile. Sprinkle with cheese, lettuce and tomato. Top with sour cream if desired. This green chile freezes really well. Steak and Mushroom Gravy 1 Tbsp. margarine frac12; onion, chopped 5 Tbsp. flour salt and pepper (to taste) 5 Tbsp. dry milk 2 cups water 1 2 cups leftover beef 1 small can mushroom pieces 1 tsp. beef bouillon powder Melt margarine in a large skillet and sauteacute; onion. Mix flour, salt and pepper and dry milk in a jar. Add water and shake. Stir into onions until simmering and thickened. Add beef, bouillon powder and drained mushrooms. Reduce the heat. Simmer, stirring constantly, until heated through. Serve over noodles, rice or mashed potatoes or toast. Serves 4. Tawra Kellam is the author of the frugal cookbook " Not Just Beans: 50 Years of Frugal Family Favorites ." "Not Just Beans" is a frugal cookbook which has over 540 recipes and 400 tips. For more free tips and recipes visit her web site at www.LivingOnADime.com . In 5 years, Tawra and her husband paid off $20,000 personal debt on an average income of $22,000 per year. Permission granted for use on DrLaura.com More >>

How To Avoid "Cell Phone Slavery" By Cliff Ennico It really is amazing when you think how far #147;personal technology#148; has come in the last 15 years. Back in 1990, we had just mastered #147;word processing machines,#148; such as the now-defunct Wang terminals, and were just getting accustomed to a personal computer on every desktop. Today, we have gone a long way toward losing the desktop. We can talk on the cell phone anywhere, anytime, and check our e-mails on a Blackberryreg; while we#146;re doing it. Throw in a wireless Internet connection and a #147;pocket PC#148;, and you are wired up to the world every minute, every day, wherever you are. But here#146;s my question: have these gizmos made us any happier, or more free? Please don#146;t think me backwards if I suggest that these gadgets are the biggest threat to our personal freedom since Communism. Don#146;t blame the technology #150; the fault is yours. Without some personal discipline, you run the risk of becoming a slave to your technology, instead of the other way around. The cell phone, especially, can get you in a lot of trouble, as anyone who wants to yank your chain and interrupt your life can do so by pressing a few buttons and hitting #147;send#148;. Case history # 1 : yesterday on my way to the supermarket a bright red SUV cut in front of me and nearly drove me off the road. Far from acknowledging how close we came to a collision, the driver remained oblivious, focusing on an animated cell phone conversation he was having (judging by his facial expression, he was either chewing out a subordinate at the office or arguing with his spouse). Case history # 2 : when I got to the supermarket another man was standing in line with a parcel to be shipped, and was talking to someone on a cell phone with a wireless headset, so from the back he looked like he was talking to himself. I stood in line behind him, and eavesdropping on the conversation (hey, I couldn#146;t help it, the whole store could hear him), realized that he was talking to a client of mine about a business transaction. I had a sheet of my stationery in my hand, so I scribbled on it #147;watch what you say, I am Mr. So-and-So#146;s attorney#148;, tapped him on the shoulder, and handed him the note. You should have seen his face change colors . . . Case history # 3 : a prospective new client called me the other day to ask for legal help. She was delighted with my fee quote, but became upset when I politely refused to give her my cell phone number. She told me flat out that in her opinion it #147;wasn#146;t professional#148; of me not to give out my cell phone number to all clients, and hung up. Far from being angry at these folks (extreme examples, I admit), you#146;ve got to feel a little sorry for them. The technology that was supposed to give them more control over their lives has instead made them more stressed out, harried and frazzled. Here are some very strict rules I follow when it comes to using my cell phone. I won#146;t claim they are perfect, or even fair, but so far they#146;ve kept me sane, and in control of my life. Keep Your Cell Phone Off as Much as Possible. Personally, I use my cell phone only for outgoing phone calls. The idea is that the phone is there for my convenience, not anyone else#146;s. When I do not wish to be disturbed, the cell phone is turned off. In fact, I turn it on only when I want to make a call. Give Your Cell Phone Number Only to Essential People. Your spouse and (if your work for someone else) your boss should, of course, have access to your cell phone number. If you are working on an intense project for a client who is furnishing you with more than 50 percent of your income, you should give the client#146;s key personnel your number as well. That#146;s it #150; cell phone access should be a special privilege you afford to only your best customers. Others can leave their messages on your land line. Discourage Cell Phone VoiceMail Messages. With #147;Caller ID#148; and other tools people can find out your cell phone number even if you don#146;t give it to them, so consider putting the following message on your cell phone VoiceMail: #147;hi, you#146;ve reached the cell phone of _________. I don#146;t normally take calls on my cellphone, and check this VoiceMail box only once or twice a week, so please be patient if I don#146;t respond to your message promptly. If your message is urgent, please call my office at [number]. I check my messages there at least every few hours when I#146;m on the road, and will be more likely to respond quickly. Thanks!#148; Do Not Use Your Cell Phone In a Crowd. You never know who is around you when you are in a public place. If anyone can overhear your conversation, do not say anything on your cell phone that you would expect to be kept confidential. Never, Ever Use Your Cell Phone While Driving. A number of municipalities have banned cell phone use while a car is in motion. Frankly, they should make that a federal law for all 50 states. If you need to talk to someone while you are driving, pull off the road to a safe place and make your call while the car is idling. And if you do get into an accident while talking on your cell phone, have the decency to give the other person your insurance information. It was your fault, after all. Cliff Ennico ( cennico@legalcareer.com ) is a syndicated columnist, author and host of the PBS television series 'Money Hunt'. This column is no substitute for legal, tax or financial advice, which can be furnished only by a qualified professional licensed in your state. To find out more about Cliff Ennico and other Creators Syndicate writers and cartoonists, visit our Web page at www.creators.com . COPYRIGHT 2004 CLIFFORD R. ENNICO. DISTRIBUTED BY CREATORS SYNDICATE, INC. Permission granted for use on DrLaura.com More >>

Investing for Children The Dollar Stretcher by Gary Foreman We have 4 grand children that we have been purchasing stock for at Christmas for the last 10 years. The stocks are valued from $500 to $3,000. The brokerage house fees were running too high even though we had them under our account. We have just liquidated the accounts and our goal is to look for the best place to invest this money and continuing our yearly $150 contribution for each. Rich Rich is right. Investment expenses matter. The Securities and Exchange Commission calculates that a 1% difference in expenses on a $10,000 investment earning 10% annually would mean a difference of $11,133 in 20 years. Rich isn't investing that much, but clearly the difference is dramatic. And Rich is also right that beginning a savings program for children is a great idea. For instance, a public college that costs $12,841 per year today would cost $36,652 in 18 years if costs rise 6% per year. There are two things for Rich to consider. First, how will he invest. And, second, how will the investment be legally owned. Owning individual stocks is very hard unless you're going to be investing more than $150 at a time. Even a minimal $8 commission reduces your $150 investment by more than 5%. So it takes 6 months or so to earn enough to make up for the commission paid. Generally, mutual funds offer more flexibility for the small investor. The average expense for a mutual fund that invests in domestic stocks is 1.4% per year. That's a whole lot better than the cost of buying individual stocks. Owning a mutual fund allows you to reinvest dividends. Something that's almost impossible with an individual stock unless a DRIP (dividend reinvestment plan) is available. If a DRIP is available for your stocks in this situation it would be wise to use it. Rich will want to consider something called an 'index' fund. Those are funds where management does not try to pick stocks that will beat the market. The fund is managed so that it reflects the make up of an index. For instance an SP 500 fund would have shares in the same proportion that they were in the SP 500 index. Shares would be bought and sold to maintain that proportion. There are two main attractions to index funds. One is that their expenses can be lower. For instance, the Vanguard SP 500 fund has an expense ratio of about 0.18%. But check the expenses on any fund. Some index funds have ratios as high as 1.5%. The index funds also generally perform better than the average managed mutual fund. As it turns out, most managers don't earn more than they charge the fund. And that means that the average fund does not perform as well as the market. If you are going to consider a managed fund, look for one that has a good 10 year track record. A great one or five year track record could have been caused by some unique factors that had nothing to do with the fund's managers. And, that could actually work against the fund once you've bought it. How should the investment be owned? Ideally, Rich would set up a UGMA (uniform gifts to minors account) for each child. He (or any legal adult) could act as custodian until the child became an adult. Because legally the child owns the money, Rich would not be liable for any taxes on dividends or capital gains. The one disadvantage is that the child can use the money however they choose when they reach the age of adulthood. Using a UGMA account has another advantage. As they become old enough to understand, you can review the quarterly statements with them. It's a perfect opportunity to teach them the basic facts about money. There's another, non-financial benefit of talking to your kids about their investment account. Often children strive to achieve our expectations for them. Knowing that you're saving for their college could encourage them to strive for the grades that they'll need. Rich might also encourage his grandchildren to add to the fund themselves. Kids often receive cash gifts. If they take just a small portion of each gift and add it to their investment account they'll take a keener interest in the account. And, they'll learn how to be investors. Finally, one of the most valuable gifts that you can give a child is an understanding of how compound interest works. There's a huge gulf between people who are paying interest on credit cards and those who are collecting interest on investment accounts. Getting on the right side of that gulf is important. Gary Foreman is a former financial planner who currently edits The Dollar Stretcher website: www.thedollarstretcher.com . The site has hundreds of ways to help you stretch your day and your dollar. Visit today! Permission granted for use on DrLaura.com More >>