Many fund freebies, some even useful

Your Funds

Your Money

July 18, 2004|By CHARLES JAFFE

IT TOOK ME months to empty a bushelbasket of peanuts in my office.

It took days for mutual fund companies to refill it.

Alas, it was hard to stomach a lot of what those fund companies fed me in my quest for the industry's best educational freebies, the kind of top-flight information that firms create knowing that educated consumers become top customers.

With my already cluttered office swamped by the influx of give-away information, I put the freebies to the following test: "Is this worth keeping one more day if it means getting a dirty look from my wife - the most patient and understanding woman in America - as she steps over it, again?"

If the material was easy to understand without being too self-indulgent, self-promotional or self-serving, it had a chance of avoiding the recycling bin. While I'll let a company discuss its products in these handouts, the reality is that investors requesting these goodies generally receive sales literature too, so shamelessly plugging the product is unnecessary.

I considered only materials available for free to all investors and not just shareholders who request it.

Looking through more than 300 pieces submitted by 30-plus firms, it was clear that most fund families do some subjects well. There's not a huge difference between any two firms' explainers of 529 college savings plans, for example. Standout materials tended to be particularly helpful, useful or unique.

Many investors say nothing makes them focus like holding the goods in their hands, so while many of these items can be found on corporate Web sites, I only looked at information that could come the old-fashioned way.

Here is the first installment in the best free reading materials currently offered by fund companies:

Calculators and slide rules: I love the old-fashioned, cardboard hand-held gadgets that let you slide your way through inputs and outcomes. You practically can't stop playing with them, learning something with each move.

While simplistic by nature, they remain a good jumping-off point on some serious financial issues.

The AIM investments calculator from the AIM funds (800-347-1919) offers a six-step process to determine what you will need to invest to play catch-up on your retirement planning (or it tells you that you're in pretty good shape). You'll be slipping and sliding to get your answers, but that's part of the fun.

The asset allocation calculator from Franklin Templeton Investments (1-800-342-5236) gives you five sample allocations, and then allows you to track how money invested that way would have performed over the five- to 20-year periods ending Dec. 31, 2003. This allows you to compare your strategy with others, which may convince you that it's time to give up something too concentrated in favor of a plan that's more moderate (or vice versa).

The sector mix calculator from the tiny North Track funds (800-826-4600) allows you to see how flopping your asset mix between technology, financial, health care and the largest Standard & Poor's 500 stocks will affect returns over short and long time periods. It gives you a numerical risk value for each asset mix, allowing you to track which portfolios are more or less risky than the S&P 500, and offers the broader index as a tool for benchmarking each possible portfolio.

As long as you are calling North Track, ask for the firm's "Share Classes Explained" brochure. For anyone who has ever been confused about how each type of share works, this is a straightforward explanation.

Organizational tools: The best thing about "Your Financial Organizer" from TIAA-CREF (800-842-2776) is that if you rip off the back cover you would have virtually no idea who provided it, and you'd be left with a valuable document for you and your loved ones.

The organizer allows you to calculate your net worth, do a straightforward cash-flow analysis and then gives you a place to list all your family's accounts, insurance policies, credit card data and more. By adding in loan and debt information, as well as the location for a variety of miscellaneous documents, this becomes an estate-planning tool, the kind of thing that should be revised every year or two and turned into a financial planning event.

Specialized investing: There will be more on some key topics next week, but if you fancy yourself a sophisticated investor, you might take a look at the "Essential for Modern Markets" series published by the Rydex Funds (800-213-1862). From sector investing to exchange-traded funds, short-selling and leverage and hedge funds, this series covers some heavy-duty investing in a clear, concise fashion.

For anyone looking into these more sophisticated investments, these pamphlets can function as a barrier to entry: If you read them and still don't understand how the investment techniques work, don't go there.

Next week: The best in free, wide-ranging investment libraries, and more.

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