Tuesday, November 28, 2006

Everything you need to know about money

I came across this list in some literature from Vanguard. We used to do great on most of these ... a perfect short list.

* Make a will.

* Pay off your credit cards.

* Get term life insurance if you have a family to support.

* Fund your 401(k) to the maximum.

* Fund your IRA to the maximum.

* Buy a house if you want to live in a house and can afford it.

* Put six months' expenses in a money market fund.

* Take whatever money is left over and invest 70% in a stock index fund and 30% in a bond fund through any discoutn broker and never touch it until retirement.

If any of this confuses you, or you have something special going on (retirement, college planning, tax issues), hire a fee-based financial planner, not one who charges a percentage of your portfolio.

From Dilbert and the Way of the Weasel, HarperCollins Publishers, 2002.

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