Quote of the Day 4-30-2012

"He knows the water best who has waded through it."
-Danish Proverb

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Quote of the Day 4-27-2012

"Be not afraid of greatness: some are born great, some achieve greatness, and some have greatness thrust upon them."
-William Shakespeare

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Quote of the Day 4-26-2012

"One right and honest definition of business is mutual helpfulness."
-William Feather

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Quote of the Day 4-25-2012

"Opportunities do not come with their values stamped upon them. Everyone must be challenged. A day dawns, quite like other days; in it a single hour comes, quite like other hours; but in that day and in that hour the chance of a lifetime faces us." -Maltbie Davenport Babcock

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What are you doing with your tax return?

Tips For Starting Out In Mutual Funds

 

 

A mutual fund is an investment that pools together funds from many investors who have the same investment objectives. The money is managed by a professional who analyzes the financial markets and selects investments. And the pool is large enough to afford a diverse array of securities, something that can be too expensive for most individual investors to do themselves.
A mutual fund provides an opportunity to invest in a diversified portfolio. The access to professional management and a diversified portfolio makes mutual funds popular with many individuals who are investing for retirement, a child's college education, or other long-term goals. Whether you are doing the research yourself or working with a registered agent, understanding some of the basics may help you make a more educated decision.

Starting Your Research

There are thousands of funds available, but how do you choose? Funds are broken down into a few basic categories: stock, bond, and hybrid (mixed stock and bond) funds,: lower risk and higher risk,: domestic and international. If you start by thinking about those categories and how they fit your goals, you can sort through the options a bit more efficiently.

The key offering information for a mutual fund is found in the prospectus, a document that explains the investment objective, the fees, and the fund management. Start with the investment objective. Does it fit what you are looking for? If you won't need this money for years, perhaps you may look to take more risk.

Fees And Expenses

The next thing to consider is the sales charge. Many funds charge investors when they purchase shares in the fund. This is known as a front load. Some will charge you a back end load when you take money out. This is used to compensate the registered agent who assisted you with your selection. Such assistance is valuable!

You should also take a look at the fund's expense ratio. This is a measure of what it costs an investment company to operate a mutual fund. Depending on the type of fund, operating expenses vary widely. The largest component of operating expenses is the fee paid to a fund's investment manager/advisor. Other costs include recordkeeping, custodial services, taxes, legal expenses, and accounting and auditing fees. Some funds have a marketing cost referred to as a 12b-1 fee, which would also be included in operating expenses.

Looking At Performance

With the expenses in mind, take a look at the fund's long-term performance. You want to get a sense of how it does when the financial markets are strong and when they are weak. Every investment has its ups and downs, but you want to make sure you can live with the fund's volatility and that the volatility is appropriate for that particular investment. As part of that, you want to compare the fund's performance to an appropriate market index, such as the S&P 500 for a U.S. large company stock fund or the Russell 2000 Index for a U.S. small company stock fund.

This seems like a lot of work, but there are some helpful resources available. Morningstar, a company that evaluates mutual funds, has great information on its website. Many people use a registered agent to help them, too.

Investing involves risk, including potential for loss.

Diversification and asset allocation do not assure a profit or protect against loss. Foreign investments involve greater risks than U.S. investments, including political and economic risks and the risk of currency fluctuations. Bonds are subject to interest rate risk and may decline in value due to an increase in interest rates. The S&P 500® Index tracks the common stock performance of 500 large U.S. companies.

Quote of the Day 4-24-2012

"A man's character is like his shadow, which sometimes follows and sometimes precedes him, and which is occasionally longer, occasionally shorter, than he is."-Madame de la Rochejuquelein

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Quote of the Day 4/23/2012

"A moment's insight is sometimes worth a life's experience."
-Oliver Wendall Holmes



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Quote of the Day 4-20-2012

"The first step in the acquisition of wisdom is silence, the second listening, the third memory, the fourth practice, the fifth teaching others."
-Solomon Ibn Gabriol

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Quote of the Day 4-19-2012

"Never part without loving words to think of during your absence. It may be that you will not meet again in this life."
-Jean Paul Richter

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Quote of the Day 4-18-2012

"Our greatest glory consists not in never falling, but in rising every time we fall."
-Oliver Goldsmith

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Quote of the Day 4-17-2012

"The fact is that in order to do any thing in this world worth doing, we must not stand shivering on the bank thinking of the cold and the danger, but jump in and scramble through as well as we can."
-Sydney Smith

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Texting while driving

Survey Shows Most Licensed Teen Drivers Still Text While Driving

A new State Farm® survey, conducted in February by Harris Interactive, shows the majority of teens with driver’s licenses, 57percent, admit to texting while driving, despite the widespread attention surrounding the dangers of this risky practice.  The State Farm survey was conducted by telephone in the United States among 652 14-17 year olds, including 280 who have a driver’s license or permit.  These results come from a follow-up to a 2010 State Farm survey, and the numbers are virtually unchanged.  Key findings in the 2012 survey include:

Texting vs. Drinking and Driving - Teens Aren’t Getting the Message

Despite academic research indicating the consequences of texting while driving can be as severe as drunk driving, some teens still don’t see it that way.  In the survey, fewer teens view texting while driving as leading to fatal consequences as compared to drinking while driving. Of 14- to 17-year-olds who intend to have or already have a driver’s license, the survey found that 35 percent strongly agree that if they regularly text and drive they will be killed someday. In contrast, the majority of teens, 57percent, strongly agree that regularly drinking while driving will be fatal.

The survey also showed that more teens think they could get into an accident when drinking while driving versus texting while driving. In the survey, of these same teens, 63 percent strongly agree they will get into an accident if they regularly text and drive. This compares with 83 percent who strongly agree they will get into an accident if they regularly drink and drive.

Parents Play a Vital Role

The survey affirms the vital role parents play in keeping their new drivers safe behind the wheel.  Teens who refrain from texting while driving were much more likely to report having frequent talks with their parents about safe driving.  In the survey, more teens who never text and drive talk to their parents very often or sometimes about driving (82%) compared to teens who do text and drive (67%).

Talks Decline When Needed Most

The survey also revealed a sharp decline in parent/teen interactions about driving after the teen receives their driver’s license.  Teens who have a learner’s permit are more than twice as likely as those who already have a license to report that they talk very often with their parents about driving (46% vs. 22%).  This is despite the fact that the first year after receiving a license brings the highest lifetime crash risk.

“The conversation should not end when teens get their license,” said Chris Mullen, Director of Technology Research at State Farm. “Through this survey and other teen driver research, we know that ongoing parental involvement in the learning process is key to keeping teen drivers safe behind the wheel.”

About the Survey

This survey was conducted by telephone within the United States between February 2 and 5, 2012 by Harris Interactive on behalf of State Farm among 652 U.S. 14-17 year olds (including 280 who have a driver’s license or permit and 362 who plan to get a driver’s license). Figures for age, sex, geographic region, and race/ethnicity were weighted where necessary to bring them into line with their actual proportions in the population.

Quote of the Day 4-16-2012

"The important thing in life is to have great aim and to possess the aptitude and the perseverance to attain it."
-Johann Wolfgang Von Goethe

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Quote of the Day 4-13-2012

"Nothing is predestined: The obstacles of your past can become the gateways that lead to new beginnings."
-Ralph Blum

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Quote of the Day 4-12-2012

"Great opportunities come to all but many do not know they have met them. The only preparation to take advantage of them is simple fidelity to what each day brings."
-A. E. Dunning

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Quote of the Day 4-11-2012

"You will never 'find' time for anything. If you want time, you must make it."
-Charles Bruxton

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Quote of the Day 4-10-2012

"The ultimate measure of a man is not where he stands in moments of comfort, but where he stands at times of challenge and controversy."
-Martin Luther King, Jr.





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Quote of the Day 4-9-2012

"Collect as precious pearls the words of the wise and virtuous."
-Abd-el-Kadar

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Quote of the Day 4-6-2012

"The ability to concentrate and to use your time well is everything if you want to succeed in business--or almost anywhere else for that matter."
-Lee Iacocca

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Are you a part of the 40%?

How Disability Income Insurance Can Help Protect You

We depend on our paychecks to cover our expenses: groceries, housing, transportation—and those are just the basics. When a person is unable to work due to a disabling injury or illness, the financial impact of lost paychecks can be devastating.

An income interruption due to a disability isn’t something you can afford to ignore. According to the Social Security Administration, more than one in four 20-year-olds will become disabled at some point before they retire. And 50 percent of working Americans would suffer financial issues in less than a month if they lost their paycheck. Twenty-five percent would have problems immediately—within a week—according to the Life and Health Insurance Foundation for Education (LIFE Foundation).

Here are some steps you can take right now:

 

Help protect your paycheck

When the unexpected happens, disability insurance can help. Disability insurance essentially replaces a portion of your income—generally about 40–60 percent—if you can’t work due to accident or sickness, says Matthew Tassey, CLU, ChFC, LUTCF and past chairman of the LIFE Foundation. “Disability insurance should be a priority,” he says. “We always have expenses.”

 

Find the right fit

There’s no one-plan-fits-all approach to disability insurance. Some employers offer disability coverage, whether long-term or short-term, so check with your company’s benefits manager to see if you have coverage, and if so, what that coverage provides. If you don’t have it, you can purchase an individual plan.
Some terms to know when shopping for disability insurance:

• Elimination period: Refers to the length of time you need to be disabled before you receive payment.
• Benefit period: Refers to the length of time benefits will last.

“The quicker the money comes your way and the longer it pays, the more expensive it is,” Tassey says. And he points out that, on average, a 30-year-old non-smoking healthy male can receive $1,000 a month up to age 65 for about $30 a month. His benefits would begin after 90 days.

 

Learn more

In recognition of National Disability Income Insurance Month in May, the LIFE Foundation has created a website that explains the basics of disability insurance, contains video testimonials from real people and provides calculators for determining how much insurance you need and estimating your lifetime earnings. You can also calculate your personal disability quotient online.


The information in this article was obtained from various sources. While we believe it to be reliable and accurate, we do not warrant the accuracy or reliability of the information. The information is not intended to replace the advice of a qualified professional. Nor is it intended to effect coverage under any policy. State Farm makes no guarantees of results from use of this information. We assume no liability in connection with the information nor the suggestions made.

Quote of the Day 4-5-2012

"I failed my way to success."
-Thomas Edison

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Quote of the Day 4-4-2012

"Life is like a game of cards. The hand that is dealt you represents determinism; the way you play it is free will."-Jawaharal Nehru

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Quote of the Day 4-3-2012

"If you have built castles in the air, your work need not be lost; that is where they should be. Now put foundations under them."
-Henry David Thoreau

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Quote of the Day 4-2-2012

"A man's character is like his shadow, which sometimes follows and sometimes precedes him, and which is occasionally longer, occasionally shorter, than he is."-Madame de la Rochejuquelein

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