Warnings about IPOs, pensions and borrowing from a 401(k)

The Ticker

January 26, 2000|By Julius Westheimer

"BE CAREFUL about borrowing from your 401(k) plan," says Ellin & Tucker newsletter. "If you can't repay the loan, it will be treated as a distribution and subject to income tax. Also, you'll pay a 10 percent penalty if you're under age 59 1/2."

"Investing in an IPO (initial public offering) is risky because the company has much less to offer in the way of history -- a `must' for evaluating a company." (Better Investing)

"It's too soon to tell how many IPOs will have staying power, but of 170 companies that went public in 1990, more than 100 are trading below their original offer price." (Financial Times)

"Buying Internet stocks can feel like bungee jumping. Before investing in them, ask yourself how much volatility you can take." (Working Woman)

"Watch your pension. Periodically check the summary plan description (how the plan works), the plan's annual report and your benefit statement." (Business Week)

"Best bonds today are those maturing in about 10 years. A 10-year Treasury pays almost as much as a 30-year bond, with much less interest-rate risk." (Fortune)

"Computer hardware stocks retain appeal and should continue to enjoy good performance as Internet needs drive product demand." (S&P Outlook)

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