Free stuff provided by funds can be great educational material

Your Funds

Your Money

May 01, 2007|By Charles Jaffe | Charles Jaffe,Marketwatch

A friend stopped by the house recently and saw an enormous pile of mail on the dining table. Picking up pieces that had fallen to the floor when he brushed them, he instantly was drawn to a cardboard calculator from a mutual fund company, then spotted an informational brochure that his mother could use.

"You got this from a mutual fund?" he asked. "Wow, my funds never send me anything like this."

Every few years, I look for the best educational freebies the fund world has to offer.

With the dining table overflowing with giveaway information, each piece is put to a simple test: "Is it worth one more dirty look from my wife - the most patient and understanding woman in America - to keep this on the dining table one more day?"

Material that is easy to understand without being too self-indulgent, self-promotional or self-serving is the best. While I'll let a company discuss its services in these handouts, the reality is that investors requesting these goodies generally receive sales literature, too, so shamelessly plugging the product is unnecessary.

My review didn't find a piece of literature that was invalid, misleading or wrongheaded. Many of these pieces are available on the fund firms' Web sites, but there is nothing like having something to read in your hands, so I reviewed published materials only.

This week and next, I will discuss the items I liked best, for their quality, subject matter or unique approach.

If you're a fund investor who is interested in these subjects, you might want to call for these freebies, and then call your own fund company to see what educational material they offer on the issues that matter most to you.

Hand-held slide-rule calculators:

I love 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. They're simplistic, but still a good jumping-off point.

AllianceBernstein's "College Debt Crunch" calculator is one of the most interesting I have seen in a long time, because it is designed to show the long-term impact of education debt on college graduates. A few minutes playing around - or letting your kids use it if they are responsible for tuition - and you're likely to increase your college set-asides immediately. You can get the calculator by calling AllianceBernstein at 800-227-4618. You also can order versions online - or use an electronic version - at www.

Of course, it helps to know how much money you will need to save, and the college savings slide-rule from American Century's Learning Quest program gives you a quick-and dirty estimate of how much you will need - and how much to invest monthly based on your child's age - in order to pay for a public or private education. You can get the calculator by calling 800-579-2203.

The asset allocation calculator from Franklin Templeton Investments (800-342-5236) remains one of my favorites, providing five sample allocations and allowing you to track how money invested that way would have performed over the five- to 20-year periods ending Dec. 31. This lets you measure your strategy against others, letting you know if you want to stay the course or need to consider a change.

Putnam Investments' "retirement calculator" slide-rule - available at 800-225-1581 - is a two-sided, dual-purpose keeper. On one side, it allows you to determine the future value of systematic investments; it's a great way to show not only how $50 a month adds up over time, but how doubling that number - or going bigger - will turn small monthly dollars into lifetime money. On the flip side, the calculator helps determine the future value of your savings, which will help you see how much $10,000 will grow to when you reach retirement, based on rates of return and your current age.

Next week: More worksheets, specialty items and basic investment libraries.

Charles Jaffe is senior columnist for MarketWatch. He can be reached by mail at Box 70, Cohasset, MA 02025-0070.

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