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Business Magazines Shape Mid-Year Strategies

By Jennifer Hopfinger
July 5, 2005 11:53 AM
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With half the year now behind us, it's time to reassess and make the most of the rest of 2005, according to financial magazines this month.

Money magazine offers nitty-gritty specifics on how to shape up financially in the July issue cover story, "The 50 Smartest Things To Do With Your Money," by David Futrelle, George Mannes and Cybele Weisser. The writers list "surefire ways to earn more, save more, invest better, spend wisely and protect your family."

Some of their tips: Use home equity to pay down credit-card debt, set up automatic monthly investments and bill payments from a bank account, create a will, gift up to $11,000 per year per child tax-free, hire a financial planner to review retirement and college savings plans, max out 401(k) contributions, fund flexible spending accounts at work and open up a Roth IRA for your kid.

They also provide a list of 15 dumb moves to avoid, including applying for too many credit cards, buying life insurance on children, getting a tax refund instead of properly adjusting your withholding and job-hunting at work.

Kiplinger's Personal Finance does something similar this month with its cover story, "Smartest Money Moves at Any Age." The magazine offers advice for different stages of life -- because "whether it's coping with a first job, starting a family, buying a first home or deciding what to do after the kids are grown and gone, every life-changing event has an effect on your finances."

Once you've got your financial house in order, SmartMoney offers suggestions on what to do with your investment portfolio in the second half of the year. In the July issue's "Midyear Investment Guide," Russell Pearlman and Beverly Goodman name stocks and funds to buy now -- and explain the rationale behind their picks.

"Fear is in fashion. In fact, it's all the rage on Wall Street. There's fear of rising interest rates, fear of a slowing U.S. economy and fear of high energy prices. All these concerns convinced investors to dump U.S. stocks in March and April," Pearlman writes. But, "investors' fears are blinding them to the fact that some of America's largest and best-run companies have been posting spectacular earnings." And those stocks are now on sale. Some of Pearlman's recommendations: Cisco, St. Jude Medical and Wells Fargo.

Pearlman also gives a brief sector outlook for the rest of the year: Rising rates will hurt existing bonds, small stocks are set to stall, Asian stocks are hot on the international front, tech is cheap and energy stocks look risky.

Goodman profiles "three market-beating portfolio managers loading up on growth stocks, positioning their funds to surge as fast-growing companies return to favor." But investors might be understandably reticent about betting on growth -- after all, the average growth fund has lost 32 percent since April 2000 while value funds have gained nearly 39 percent in that period. But since growth stocks are now selling at great values, Goodman writes, it's time for a reversion to the mean. One of Goodman's picks: Oakmark Fund.

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