“When your dream appears as an opportunity, you must have ready cash to take it home with you.”

- Anonymous

Welcome to Money-Smarts, MsMoney.com's weekly newsletter of financial facts, features, and tools. Money-Smarts is designed to provide quick and useful information to help secure your financial future. Enjoy, and tell a friend about MsMoney.com!

In This Week's Issue:

• Market Summary for Friday, August 4, 2000
• Tips for the Week: Daily Advice to Help Get You Through the Week
• Read the Latest: Looking to Diversify? Try a Trip Overseas
• Run the Numbers: How Many Years Until You're a Millionaire?

Market Summary for Friday, August 4:

Close

Net Change

Percent Change

DJIA

10767.75

+61.17

+0.57%

NASDAQ

3787.36

+27.48

+0.73%

S&P 500

1462.93

+10.37

+0.71%

30-Year Bond

5.71%

-0.05

N/A

Source: Reuters

Tips for the Week: Daily Advice to Help Get You Through the Week

Monday: What are you saving for? Write down your financial goals and keep them posted where you can see them every day. The next time you're tempted to splurge, check your list of goals and remember what's most important for you to achieve. Learn more about financial goals and priorities.

Tuesday: Asset rebalancing is necessary to ensure that your current investment mix stays in line with your financial objectives. Automatic asset rebalancing programs, offered by many mutual fund and annuity companies, make it easy to maintain your asset allocation strategy. Learn more about asset rebalancing.

Wednesday: Don't spend a dollar to save thirty-five cents in taxes. The "If I borrow money, the interest is deductible" approach has led many a borrower down the wrong--and expensive--path.

Thursday: Put your emergency cash fund to work--make sure you have an interest bearing checking account. Learn more about checking accounts.

Friday: Stagger your investments and withdrawals to protect yourself at both the front and back ends of the investment cycle. Regular, gradual investing allows you to benefit from dollar cost averaging. At the other end, staggered redemptions allow you to cash out strategically, starting with investments at all-time highs while holding those experiencing price drops, giving them more time to recover.

Read the Latest: Looking to Diversify? Try a Trip Overseas

By Megan E. Lundin

The recent volatility in the U.S. stock market probably has you thinking of ways to diversify your portfolio--so why not let your money take a trip overseas? International investments are a great way to expand your portfolio and get the diversity you need to weather most economic storms.

"No one region gets all the excess returns over long time periods," says Chris Wolfe, global equity strategist at J.P. Morgan. "History points to the wisdom of international diversification, so it's smart to take advantage of various political and geographical spheres, because if you are only investing in the U.S. you are only availing yourself to one set of opportunities."

Wolfe illustrates his point by comparing market index performances over past decades--Japan's compound annual growth rate was 9.3% in the 70's, compared to a meager 0.3% in Europe and a sluggish 2.4% for the Standard & Poor 500 in the United States; and in the 80's, Japan and Europe outperformed the U.S. with compounded annual growth rates of 20.8% and 15.3% respectively, compared to the S&P 500's 12% growth rate. Furthermore, according to Morgan Stanley Capital International, the U.S. market has been among the world's top five performers in only four of the past 20 years. More-->

Run the Numbers: How Many Years Until You're a Millionaire?

Calculate how much you'd need to invest on a monthly basis in order to save one million dollars at the age of your choosing.

Questions

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