Evening star., 1962-03-22
THE GOLDEN YEARS
What Should You Do
With the Nest Eoo?

1lBulC tlldJ UIlC llISI live
years of retirement, or up
to age 10, will be the best.
So the two will enjoy them
selves. They split the $4,000
into five equal parts and use
$1,000 each year Tor $133 a
month"; to live it up, with
trips, winters in the sunshine.
etc. There are many varia-
tions to this tune, such as
splitting the money over a
life's expectancy of Is years
or so or blowing it all in one
grand trip around the world.
This is not considered pru-
dent. But it's fun.
TAKE 1T WITH YOU. The
couple can go to a reputable
funeral home and make all
arrangements in advance.
There's no rule saying they
can't have gold-plated cas-
kets If they chooSe-though
the heirs may weep.
PUT 1T IN THE BANK.
Interest on savings accounts
in normal commercial banks
now runs up to 4 per cent,
usually paid semiannually
or quarterly. The couple can
put their money here with
peace of mind and usually
can draw it out simply by
walking up to the counter.
PUT 1T IN A SAVINGS
AND LOAN. The couple us
ually gets a little more in
terest here - up to 4l2 per
cent, payable quarterly or
semiannually. Rules differ
from city to city. as the in
terest rate does. but usually
the couple can draw the
money out whenever they
want it. There's peace of
mind here, too, if the couple
selects an insured savings
and loan.
BUY AN ANNUITY. The
retired couple can 60 to a life
insurance company and buy
various types of annuities
for cash. The annuity guar
antees payments of so much
per month for life, the
amount depending on the
ages of the couple and the
sum of money put into it.
A common type of annuity
is one that returns no mon
ey upon death, thus enabling
higher monthly payments.
BUY MUTUAL FUNDS.
This gets into what is known
as investments" as con-
trasted with savings" The
couple buys mutual funds
from investment houses. bro
kers and, in some cases,
banks. A mutual fund is US
ually a collection of stocks
or bonds, or both. A share in
a mutual fund is share in a
package of these stocks and
bonds that may cover 100 or
more industries. The man
ayers of the fund are con-
stantly buying and selling in
an effort to enhance the
value of the shares or to in
crease the income from them.
These managers are pros"
in the business of invest
ments, while the normal per-
son who buys stocks and
bonds is an amateur. There
fore, the theory is that by
spreading the investment
over many industries and
getting professional manage
ment. the normal investor is
in safer waters. Return
ranges up to about S per cent.
The money invested in
creaSes or decreases as stocks
and bonds do.
BUY COMMON STOCKS.
The couple here casts its for
tune with the ups and downs
of the country's economy. An
investment of $4,000 may
grow to $4,000, or may
shrink to $4,000. In general,
there are three kinds of COM
mon Stocks-groWth, income
and safe. The retired couple
would want income and safe
ty. Both can be had currently
in stocks that pay up to 5
per cent return. Stocks, like
the mutual funds, usually
ride inflation's back, going up
in value as the cost of liv-
ing rises. Stocks are bought
from investment houses and
brokers.
BUY PREFERRED STOCKS.
They're a bit safer than
common stocks, with a return
of 3 to 4 per cent, but with
little protection against in
flation. The retired couple
with substantial money would
do worse - in fact, this is
wnere wealthy retired people
often have much of their
money. Preferred stocks are in
the same general area as
corporate bonds and munich
pal (tax-free) bonds, so far
as retired people are con-
cerned. They're respectable,
reasonably safe and dull.
Copyright, 1862, General Features Corp. }
The Golden Yeors oppeors
Thursdoys.