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Greetings!
Welcome Springtime! It's been a long winter and most
of us are looking forward to the warm weather, and
hopefully a sustained market rally.
| Take Our Quiz! |
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Our question of the quarter is:
What was the high and low share price of United
Airlines stock from the period October 1997 - January
2003?
a. $101.75 - $1.51 l b. $99.87 - $2.85 l c. $111.01 -
$3.06 l d. $101.75 - $1.01
United Airlines hit a high in October of 1997 with a price
of $101.75. Now in bankruptcy, United has traded as
low as $1.51, earlier this year. If you answered A, you
were correct. Why is this important? It underscores
the importance of an exit strategy. An exit strategy is
a predetermined price at which you plan to sell a
stock. This strategy applies to the high end you will
sell at - recognizing the price point you are targeting
for taking profits, as well as a low end. If your stock is
declining, at what price will you sell to minimize your
losses? Many focus on the low-end selling strategy,
but United is a good example of knowing when to take
profits. It also is a good reminder that not all stocks
bounce back after a decline.
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| Don't Wait for Disaster to Strike, to review your financial plans. |
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The Station Fire in Warwick, RI adversely impacted
many people. This predominately young group of
people probably never thought about life insurance,
wills, custodianship for their children or emergency
funds. Take some time to make sure your will or trust
document is current. If you have children, establish
guardians in case of parent's simultaneous death. Also,
establish a trustee for whoever may be looking over the
children's inheritance. The person raising your child may
not be the right person to manage their investments.
Review your life insurance policies for yourself and
spouse. Do you have enough coverage and are the
policies titled properly? If you or a family member is a
reservist, these are areas you cannot wait to deal with.
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| Upcoming Speaking Events |
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I will be speaking at the following events in April. Please
bring a friend and join me at these educational sessions.
Tuesday, April 8th 4:00 p.m.
Providence Business Expo, Convention Center,
Providence, RI Room 554B, 5th floor
Topic: Is your Broker Making you Broke - Seven
questions to get you back on track.
This event is free and sponsored by the Greater
Providence Chamber of Commerce
Wednesday, April 23rd 5:30 p.m.
Bryant College- RI Association for Women in Education.
Room MRC 4.
Topic: Bag Lady or Financial Goddess, Retirement
Planning for Women
Reservations can be made by contacting Jennifer
Chasse at 401.232.6501 or jchasse@bryant.edu, This
event is $10 for RIAWE members, and $20 for non-
members
Please contact me for more information at 401-727-
8151.
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| From Angela Thomson, CFP. |
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Angela Thomson is the founder of Coastal Financial
Planning. She is a graduate of Bryant College. She
completed her CFP® course work in conjunction with
Northeastern University, and is a CFP® licensee.
Additionally, she is a registered investment advisor.
She serves as an adjunct professor at Bryant College
teaching the CFP® Program.
Mrs. Thomson hosted Public Access Television's weekly
series, "Your Money", and has conducted various
workshops covering women and investing, funding
college education, retirement planning and investing in
uncertain times.
She has published several articles including "Your Young
Investor", "Retirement Savings and Investments for
Women" and "Weaving Your Way Through the IRA
Maze", and is frequently quoted in the Providence
Journal.
Angela Thomson serves as an officer for the Financial
Planning Association of Rhode Island. She also
volunteers as a Money Mentor, working in conjunction
with the Commonwealth of Massachusetts Treasurers
office and also with the Rhode Island Chapter of the
Financial Planning Association.
Coastal Financial Planning is located at 13 East
Butterfly Way, Lincoln, RI 02865.
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| Is it time to revisit your 401(k)? |
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Over the last three years many employees have moved
their 401(k) and 403 (b) investments to conservative
holdings. This would include heavy weightings in money
market accounts and bond funds, within their plan. We
have had a promising rally in mid-March, and although
no one knows if it will be sustained through the year, it
certainly has given rise to rethinking those retirement
allocations. A moderate position to consider if you are
at least 10 years away from retirement would be as
follows: 25% bonds, 25% large-cap, 10% each cash,
international, small-caps, mid-caps and REITS or sector
funds.
This will allow for greater diversification, and allow you
to capitalize on anticipated market trends. Those of
you that are within 2 years of retirement or in
retirement should reduced the large-cap position and
add to either the bond component or an income &
growth fund. Another consideration is family health.
Many people in retirement live long and healthy lives. If
your families' medical history favors longevity and you
anticipate a 20 year retirement lifestyle, you can
maintain a moderate portfolio to maximize earnings in
your golden years.
Younger individuals may not be able to count on social
security in retirement. Planning is essential to a
comfortable retirement. You need to take into
consideration several factors beyond your 401(k) plan.
Even if you are maximizing your 401(k) plan at 15%, it
still represents only 15% of your salary compounded
over time. Utilize other vehicles like Roth's or
Traditional IRA's to provide a comfortable retirement.
Anticipate what your expense will be in retirement. Will
you still have a mortgage? Do you have you children's
college loans to pay off? Will you still need to carry a
life insurance policy? Property taxes don't go away,
and you can count on increases, as well as
homeowners and auto insurance rate hikes. Have you
really spent enough time analyzing what you fixed costs
will be in retirement and what your discretionary
expenses will be. Do you plan to travel? Are you
willing to still work part-time into retirement? To start
this analysis, write down your current expenses and
look at realistic earnings for the future.
If you're a woman the statistics are concerning. Eighty
percent of all widows living in poverty become poor only
after the death of their husbands. Seventy percent of
the elderly poor in America are women.
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