As market fluctuates, there are a few things to keep in mind

The Ticker

April 02, 1997|By Julius Westheimer

There is divinity in odd numbers, either in nativity, chance, or death.

-- Shakespeare

ALTHOUGH the Dow Jones industrial average edged up 27.57 points yesterday to close at 6,611.05, after plunging 297 points in the two previous sessions, many investors still appear nervous about their stocks, mutual funds, 401(k) plans, etc.

Therefore we present today some long-term suggestions and references that we hope will prove helpful in both down and up markets:

If you put $25 a week in stocks that grow 10 percent a year -- that's under the average annual 10.5 percent stock return over 70 years -- you will have $103,000 in 22 years, before taxes.

A person who begins that program when he or she is 25 years old will have over $725,000 by age 65.

"O.K.," you say, "but what broker will help a penny-ante investor like me?"

Money magazine answers: "Over 100 mutual funds let you open accounts for $100 or less if you regularly have $50 or $100 a month electronically transferred from your bank to your fund account." Check your broker.

There's value in rising dividends, no matter how Wall Street behaves. If you bought Coca-Cola stock 10 years ago, you would now receive an 11.4 percent return on your investment, and increases every year. (This does not include Coke's surge, adjusted for splits, from $5 to $57). Good brokers have lists of consistent dividend-raisers.

Between 1934 and 1996 there were 60 reasons people gave for not investing in stocks: Depression, wars, assassinations, "market too high," etc.. But in that period, $1,000, measured by the S&P 500-stock index, grew to $550,000.

If you retire with a $40,000 annual income, you will need, 25 years from now, about $106,000 a year at 4 percent inflation to maintain your same living standard.

Pub Date: 4/02/97

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