The following are the year-end market results by market index:
Index (Year-End Mark) Year-End % Change
DJIA...........(10,783)......3.1%
NASDAQ......(2,175)...... 8.6%
S&P 500......(1,212).......9.0%

I am happy with how our clients faired this year. The typical portfolio heavily weighted in equities had a 12.65% return this year, and the more conservative positions came in at 6.75, before fees and any anticipated taxes. It should be noted that no two portfolios are identical due to individual risk tolerance and time horizon. And to be compliant with the SEC I will remind all readers this should not be viewed as an advertisement for past or future performance by the firm. It should be used as a benchmark for you to gauge your personal portfolio success.

While no one can predict the 2005 market, we can be sure that it will be frustrating for both bulls and bears. Ultimately it will boil down to making intelligent choices that best reflects the great number of uncertainties that affect our global markets. As many of you know I have a strong bias toward individual stocks due to transparency and easy access to the availability of financial information. In 2005 I will also continue utilizing the same equity strategy, but will also integrate mutual funds into portfolios as specific sector plays.

Royce Low-Priced Stock Fund is now closed to new investors. Many of my clients with a long-term investment horizon and an aggressive focus will find this fund in their portfolio. New clients will be placed in comparable investments, which may be in the Royce family of funds. Royce funds have been a longtime favorite of mine, as this firm employs a value focus but does not lose sight of growth prospects or company valuations.

Identity theft is spiraling out of control. It can happen online or off-line. The off-line occurrence generally can be traced back to criminals finding your mail with a credit card application or a credit card receipt with your card number imprinted on it. They use personal identification information, then open credit card accounts access banking and investment accounts, and ruin your credit rating for years to come. Statistics show the average identity fraud victim spends 175 hours and over a $1,000 fixing the problem.

How do you avoid becoming a victim of credit card theft?

Are you planning on retiring within the next 5 - 10 years? If so, have you given this goal careful consideration? Planning ahead is more difficult than one can imagine. First you want to establish a retirement wage replacement ratio (WRR). Simply stated, what part of your current wages will you need in retirement. Let's assume your annual household income is $100,000 and you will have no mortgage in retirement. Now let's assume you will need a 65% WRR, or $65,000 annually. You will have fixed expense in retirement such as property taxes, income/investment taxes, utilities, etc. Some of your expenses may rise, particularly medical expenses. Add all these expenses together to see where the costs fall. You will also need to adjust for annual inflation. Now let's assume you are concerned that you cannot attain the $65,000 income figure either because you have not adequately funded your retirement or because your retirement figures exceed the dollars you had initially budgeted.

What do you do?
Here are some ideas to help you catch up on retirement funding. Cut $250 out of your budget monthly. Money is often spent freely on discretionary items: the drive-thru, entertainment, vacations and social activities. Be cognizant of how you are spending your dollars monthly and put that additional $250 into an automatic savings account, preferably a tax- deferred vehicle.

Manage your credit cards better. It is so easy to charge everything from sporting goods to groceries. The monthly Visa bill usually comes in higher than anticipated. To curb your spending, commit to paying cash or using your debit card for purchases. Cash purchases make you more cognitive of how money is spent and will cause you to analyze your wants versus your needs more closely.

Spend time planning your retirement. Most people put more time into planning their annual vacation than they spend looking at their annual investments. Look over monthly statements. Are your assets growing at the pace you anticipated? Are you on track with investment projections for retirement? Have you maximized all the tax-deferred programs at your disposal? Is your portfolio weighted too heavily in your employer's stock? As you approach retirement, remember to diversify your portfolio and temper back the risk.

Evaluate your 401K Dramatic shifts have taken place in 401(k) holding since 1999. The average assets allocated to company stock were 19%, now it's down to 16%. The average allocation to equities was 53%, now those positions have been reduced to 40%. Have you evaluated your 401(k) lately? In a recent Allstate retirement study 1/3 of current retirees said they wish they had educated themselves better on different retirement savings options. One in five seniors admitted to being unprepared for retirement and didn't have a good understanding of investments.

When seeking advice, remember one solution does not fit all. Make sure your advisor understands how you feel about risk and how far away you are from your projected retirement date. Every client has unique circumstances and individual retirement goals. Advice should be personalized and tailored to the client. If you don't do the proper planning now, you may find yourself working well beyond 65, or experiencing a dramatic shift in your retirement lifestyle.

I am very happy to have had the honor of being profiled in the Providence Journal as one of the women in business to watch in 2005. The article focused on women who have made past contributions to business and will continue to forge ahead in their field. I am proud to have been selected as part of this elite group of women. As many of you know, I am now assuming the chairpersons' position with the Financial Planning Association of Rhode Island. I will also continue to teach retirement planning annually at Bryant University.

I would like to thank my family, clients and colleagues for the past support of my various professional initiatives. This year has brought about many changes, all positive. In January the firm was profiled in the Wall Street Journal in a piece discussing fee- only financial planners. This summer my family and I had a great opportunity to watch our middle son, Eric, and his friends play in Williamsport for the Little League World Series. In September, I moved to a new office location, and we had a wonderful open house celebration with our clients and friends. I hope to continue to exceed my clients' expectations by delivering consistently solid investment performance as well as maintaining clear and constant communications with my clients. Listening has been the cornerstone to the success of client relationships and I am appreciative of those clients whose referrals have furthered the development of my business.