STOCKS SELLING FOR the lowest price-earnings ratios will do six times better than ones with the highest P/Es. Three industries fill the bill: Major regional banks, tobacco and department stores." (Fortune, Oct. 16.)
HOPEFULLY HELPFUL: "Protect your credit card number. At work, don't leave any document containing it in sight or in trash. Don't write it on personal checks.
"Check your credit report regularly for charges that aren't yours. Examine statements promptly for unfamiliar charges." (Bankcard Holders of America.)
And, in response to several requests, here's the phone number for the lowest credit card rates: (703) 389-5445. The fee is $4.
SLEEP BETTER: "What if You Can't Earn a Living Any More?" asks the new Kiplinger's Personal Finance Magazine, November, a story subtitled, "Disability Insurance is a Must." Highlights:
"If income from a group policy is insufficient, add to it yourself. Protect your income, not your job. Insure for the long haul. Get a noncancelable policy you can keep. Keep the frills down. To reduce commissions, call Wholesale Insurance Network at (800) 808-5810. The whole article is worth reading.
OUR TOWN: Baltimore is listed under "Cities With Largest Single-Family-Home Price Declines," in a National Association of Realtors survey. Our median price drop, second quarter vs. a year ago: 8.2 percent.
T. Rowe Price annuities are listed under "10 Low-Cost Variable Annuities," in Money, Oct. Phone (800) 469-6587 for a prospectus.
E9 START EARLY: "Your tax-deferred retirement plans will
pile up more than you think," says the Fortune Retirement Guide Special Issue:
From the story, here's what three different employees would save in their qualified plans: (1) an IRA (2) a 401(K) plan and (3) profit-sharing. All figures assume annual employee contribution of 8 percent of salary, 4 percent company match and 5 percent profit-sharing. Salaries increase 4 percent annually. Plans grow in value 8 percent a year:
(1) 30-year-old, income $40,000, amount in qualified plans $30,000. Amount at age 65: $2.5 million.
(2) 40-year-old, income $100,000, amount in qualified plans $100,000. Amount at age 65: $2.7 million.
(3) 50-year-old, income $130,000, amount in qualified plans $150,000. Amount at age 65: $1.3 million.
Is 8 percent unreasonable growth to expect? Not really. Since 1926, the S&P; 500-stock index returned an average 10.2 percent a year.
SAFE (?) DEPOSIT: Did you know that valuables in bank safe-deposit boxes are not always protected against loss through burglary, flood or fire? Ask your bank what coverage you have.
Safeguards: Keep a list at home of all box contents. Buy insurance for all valuables but realize that reimbursements are generally low and most negotiable items such as securities, gold and cash are not covered.
Alternative: Leave stocks and bonds with your broker, where you're insured up to $500,000 by SIPC (Securities Insurance Protective Corp.) Also, most firms carry more insurance,
sometimes up to $10 million per account.
Another option: Open a custody account with a bank. The bank holds your securities, collects all dividends, interest, etc., and sends it to you. See your banker for details.
LAST LINES: "If you don't keep your employees happy, they won't keep your customers happy." (Bits & Pieces.)
Your emotions are the best 'reverse indicator' of what you should be doing in the stock market." (Gerald Loeb.)
"The best investment results come from holding good stocks over long time periods, and not worrying too much about the ups and downs of the market." (Burton Malkiel, author.)
Tip to salesmen and saleswomen: "The bee that sticks close to jTC the hive gathers no honey." (Old Chinese proverb.)
"The poorest man at the table always reaches for the check."