WH Cornerstone Newsletter
Turning your paycheck into a playcheck November 2004

in this issue

Identity Theft: Not as Bad as You Thought - It's Worse

How to Respond to Higher Interest Rates

Should You Join the Rush to International Equities?

How Oil Prices Influence the Economy

Visit the Universe of Mutual Funds

Using a Split Annuity Strategy

What is Financial Planning?


Identity Theft: Not as Bad as You Thought - It's Worse

If you've been hearing more and more about identity theft, there's a good reason. Recent evidence suggests that the damage this crime causes may be underestimated.

Victims can spend an average of 600 hours recovering from identity theft, up from estimates of 175 to 200 hours in 2000, according to one recent study. Out-of-pocket expenses to correct the problem averaged $1,400, a 185 percent increase from previous years' estimates.

One startling finding was that 62 percent of identity theft victims don't know how their personal information fell into thieves' hands. In other words, you can't be too careful when it comes to protecting your personal information.

Perhaps the best line of defense is to keep your private information private - but not only from strangers. Ten percent of victims had personal information stolen by a friend or roommate, 11 percent by relatives, and 13 percent by employees of a business that had their information.

Here are some steps that may help you avoid becoming a victim.

  • Shred private records or statements before throwing them away.
  • Use cash whenever possible.
  • Collect your mail as soon as possible or lock your mailbox.
  • Check your credit report at least once a year.
  • Resist giving your Social Security number to anyone except those with a legitimate need for it, such as motor vehicle departments, tax agencies, or certain financial institutions.

When someone uses another person's identity fraudulently, the cost can involve a staggering amount of time, money, and productivity. Protecting your personal information may help reduce your exposure to this costly crime.

Read on...Identity Theft


It has been so much fun to be a part of Red Sox nation this year! Now it's time to focus again. If you work for a company, it is likely that benefits open enrollment is happening as we speak. Make sure that you take a look at your options for health care, that you are maximizing your participation in the 401(k) and that your W4 withholdings are correct.

Time to Share. Create a Buzz. The Duxbury Art Association was founded in 1917 for the "artist in everyone". They are presenting their 32nd annual Craft Showcase & Sale November on 20 & 21 at Duxbury High School. This highly-anticipated South Shore event celebrates 70 of New England's most gifted artisans. Whether your gift list includes $10 hand-painted ornament or a $100 hand bag, you will be amazed at the array of quality crafts for sale at this annual DAA event. Please visit the DAA website for all the details.

  • How to Respond to Higher Interest Rates
  • Ever since Federal Reserve Chairman Alan Greenspan indicated that short-term interest rates would rise gradually, Americans have been bracing themselves for a period of rising interest rates.

    Although higher rates are a sign of an improving economy, interest-rate hikes are often used to help counter inflation and an overheated economy. However, the Federal Reserve generally is cautious and avoids raising rates too high or too fast in order not to stifle economic growth.

    Read on...
  • Should You Join the Rush to International Equities?
  • American investors are pouring money into international stock funds at a rate that is likely to set a record. Seeking an alternative to less-than-stellar U.S. stock market performance, investors increased their holdings of international mutual fund shares by $56.6 billion during the first nine months of 2004. At that pace, it seemed likely that 2004 inflows would surpass the record $58 billion of new money that flowed into international funds in 1994.

    Looking back over the past year, it's easy to see the attraction. The MSCI EAFE Equity Index, a measure of the stock performance of 1,100 companies in 20 countries, mostly in Europe and the Far East, was up 23% for the 12-month period ending September 30, 2004. That's far ahead of the 14% return from the S&P 500 during the same period.

    Read on...
  • How Oil Prices Influence the Economy
  • When crude oil prices drive gasoline prices higher, consumers may feel the pinch at the pump and notice the impact of rising oil prices on their investments. Many businesses around the country may be affected - from companies that make oil-based products to the airline industry.

    According to a Federal Reserve Bank of Dallas study, nine of the 10 U.S. recessions since World War II were preceded by spikes in oil prices. But because of lessons from the oil price spikes and energy shortages of the 1970s, 80s, and 90s, the ripple effect of higher oil prices on today's U.S. economy is not as great. Nowadays, the economy generates more of its gross domestic product from the service sector, which is less dependent on energy sources than the manufacturing industry.

    Read on...
  • Visit the Universe of Mutual Funds
  • It's nice to have a choice. But when you're able to choose from thousands of possibilities, as in the case of deciding which of 8,000 mutual funds to add to your portfolio, a decision can be overwhelming.

    Evaluating every option would be unrealistic. It may be more effective to identify the type of mutual fund that is appropriate for your situation. Here are some basic types of mutual funds and why you may want to consider them.

    Read on...
  • Using a Split Annuity Strategy
  • More than half of Americans aged 50 and older are worried about having enough money for retirement.

    One way investors can help ensure that they have enough money for a long retirement is to consider annuities. An annuity is a long-term financial vehicle that can be used to provide income in retirement. During the accumulation phase, the contract can be funded with a lump sum or a series of payments, and any earnings accumulate tax deferred. A fixed annuity specifies the interest rate that will be paid for a certain number of years; any guarantees are contingent on the claims-paying ability of the issuing insurance company.

    Read on...
  • What is Financial Planning?
  • Financial planning is the process of meeting your life goals through the proper management of your finances. Life goals can include buying a home, saving for your child's education or planning for retirement.

    The financial planning process, as described by the CFP Board, consists of six steps that help you take a "big picture" look at where you are financially. Using these six steps, you can work out where you are now, what you may need in the future and what you must do to reach your goals.

    To learn more ...
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