> From: Goldstein, Jon W.
Sent: Tuesday, May 28, 2002
To: 'Murray, Jonathan P.'
Subject: $
Hello, Jonathan,
It's a dilemma many parents fear. Junior gets into Harvard, but you can only afford State U. When is the right time to start saving for college?
Here's the question:
Hi, Jonathan -
I now have a 1-year-old daughter, and I am dying to get a college fund started for her. How do I go about it? How do I know how much I need to save in order for it to be worth enough in 17 years?
Thanks, Michelle
From: Murray, Jonathan P.
Sent: Tuesday, May 28, 2002
To: Goldstein, Jon W.
Subject: RE: $
Dear Michelle,
You are wise to start saving for college ASAP. College costs have been rising at more than twice the rate of inflation, with projections of continued increases going forward. It used to be that buying a house was your single biggest investment -- now, especially if you have more than one child -- it's paying for their education. Many private, selective colleges cost well over $30,000 per year today. That's NET of taxes!
The good news is that if you start early, with a regular, systematic savings program, you can make good progress toward meeting those costs, come enrollment time. Thanks to the power of compounding, even small, monthly investments can help. For instance, if you invest just $100/month into a tax-free College Savings Plan, in 18 years, your total investment would be worth $48,330, assuming an annualized rate of return of 8 percent/year. Think about it ... you invested just $21,600, and it grew into $48,000. The numbers look even better if you can fund the program with an initial lump sum investment, or if you can save twice a month.
There are many attractive College Savings Plans out there ... you should consult with a financial adviser about which one is best suited for you and your daughter.
> From: Goldstein, Jon W.
Sent: Tuesday, May 28, 2002
To: 'Murray, Jonathan P.'
Subject: $
I came across the term pro forma earnings in a recent 10k
from a new spinoff. How much emphasis is usually placed on these
magical numbers?
Kenneth
From: Murray, Jonathan P.
Sent: Tuesday, May 28, 2002
To: Goldstein, Jon W.
Subject: RE: $
Dear Kenneth,
Pro forma is receiving a lot of attention these days, in the wake of the Enron and Arthur Andersen scandals. This way of reporting earnings is nothing new, however. Sometimes called "adjusted" or "ongoing" results, pro forma figures are supposed to show hypothetical results.
Properly used, pro forma data can give investors a point of comparison from one year to the next. For example, if a $1 billion company buys a $500 million one, without using pro forma, it might look as if the company experienced a 50 percent increase in sales. On a pro forma basis, however, sales might be flat, or even down.
The problem is that some companies and analysts have used pro forma improperly, to either conceal data or to paint a prettier picture than actually exists. Even though pro forma numbers are filed with the SEC in official earnings statements, they aren't audited, so companies are left with a lot of leeway. When you see pro forma being used with an earnings report, rather than GAAP (generally accepted accounting principals), you shouldn't automatically run the other way, but you should know why they are reporting in that fashion. A little bit of skepticism is healthy in this environment.
> From: Goldstein, Jon W.
Sent: Tuesday, May 28, 2002
To: 'Murray, Jonathan P.'
Subject: $
Where can I find information on a company by the name of
CYCLEAN? I have a client that purchased $15,000 worth of their stock
but has lost track of the company. The only address I was able to
find was in California with an 800 number that is no longer in service.
Joseph
From: Murray, Jonathan P.
Sent: Tuesday, May 28, 2002
To: Goldstein, Jon W.
Subject: RE: $
Dear Joseph,
I tracked down Cyclean for you. It doesn't look too promising. They are not publicly traded, and, according to their receptionist, they are "closed" ... and they weren't referring to a temporary, Memorial Day kind of closed. The number to call is 818-837-5047 or 800-882-4117.
> From: Goldstein, Jon W.
Sent: Tuesday, May 28, 2002
To: 'Murray, Jonathan P.'
Subject: $
Thanks, Jonathan.
Talk to you next week.