In perfect Mutual Fund your money is not spread too thin. For example, putting $5,000.00 into, lets say, S&P 500 Index Fund, you would end up owning around $10.00 worth of 500 different companies. Other than obvious fact that your money is being spread too thin, any dividends from companies in Index Fund could possibly be eaten up by management’s operating expenses, advertising fees and whatever other Mutual Fund fees (they’re called ‘hidden fees’)are involved.

In perfect Mutual Fund valuation of a stock is based on how often a company raises its dividend and company’s stock appreciation in market place for past eight years. It is this valuation that earns it its place in perfect Mutual Fund. The perfect Mutual Fund ignores all other elaborate techniques of security analysis to find value in a stock. I guess you could call it a Jerry Maguire, ‘show me money’ security analysis. (Also, in my opinion, too many people spend too much time looking at technical charts trying to predict what a stock or stock market is going to do tomorrow. Just because thousands of people on Wall Street make a living doing ‘technical analysis’ doesn’t mean you have too jump off a building, too.)

In perfect Mutual Fund it is belief that dividend is one measure a company cannot fudge. The money has to be there to pay shareholder. The earnings, P/E ratio (trailing or forward), price to sales etc. will all fall into place if company still has enough earnings every year to continue raising its dividend. The perfect Mutual Fund assumes that if a company, for example, that has a history of raising its dividend for past 35 consecutive years; it must be doing something right!

In perfect Mutual Fund dividends from companies are also a safety factor that will put a bottom (support) on a stock. The dividend yield/return will keep price of a stock from falling too far, in case of a severe drop in stock market. And, of course, in perfect Mutual Fund, lower stock prices accelerate your income.

The perfect Mutual Fund is real!

How to begin and invest in your own perfect Mutual Fund can be found in my book ‘The Stockopoly Plan’. Excerpts from book can be found at www.thestockopolyplan.com

If you’ve been thinking about re-financing, there are still some good deals out there and there’s no sense in procrastinating any longer. Contact me for some excellent resources for re-financing.

What if a new house isn’t in your plans for a couple of years? When rates go up, it often cools off real estate prices and balances out higher rates. Continue to save money in highest interest short-term accounts you can find (no stocks or other long-term investments). Rates will probably not take huge leaps in short term. If you have an adjustable rate (home or home equity or car loans), you will see higher payments so call your lender to find out what new payment is “likely” to be. They’ll probably put all kinds of disclaimers out about not really knowing, but try to get a worst case scenario and then start pretending you really do have that new payment. Put extra into a special savings account so you’ll have a “slush” fund to cover if you run short one month. At same time you are building up a cushion for future, you’ll have a good idea of whether or not you can handle new payment. If not, now’s time to start looking at other alternatives like cutting back, increasing income or even refinancing. Remember, if you refinance your existing term to a new 30 year term, you’ll have lower payments, but you’ll pay a lot more for your house because of additional interest.

Call you credit card companies and see if they are willing to lower your rates (not all are). Look for good, permanent credit card interest rates that you can transfer higher rate balances to. For example, if most of your cards are 18% or higher, find a good 12% card or lower and transfer as much as you can to that. Playing 0% credit card shuffle is a dangerous game and can hurt your credit score.

Reduce credit card debt now! Stop using your cards and pay more than minimums. If you pay off one card, take that payment and put it on another card.

If you receive a pay increase, put it on cards. The sooner cards are paid off, more flexibility you’ll have!

All in all, we’re quite likely to enjoy reasonable interest rates for some time to come. However, make preparations now and you’ll be able to handle whatever comes your way.