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  A Few Basic Investment Tips  

Surprisingly, Americans have over a trillion dollars in outmoded accounts paying less than 2% interest.  And billions of dollars are invested in mutual funds, the vast majority of which do worse than the overall market.  Those funds that outperform the market often fall back into underperformance soon, after a flock of incoming investors have diluted its value and focus.

When you hear promises that an investment will "outperform the market" that's usually just gambling in disguise, complete with winners and losers.  By using these simple tips to get better returns on your savings and investments, you can virtually reap a sizeable bonus!

Four Common-Sense Tips To Improve Your Investment Returns
1. Pay lower & fewer fees. Use a discount broker that charges low fees (many are rated by Smart Money Magazine) and avoid stock "churn" so you won't pay fees often.  Buy mutual funds with great caution because they charge extra fees and usually don't pay as much as the overall market.
2. Manage risks carefully. Ten years from now, the Dow may be at 30,000 or 3,000 -- nobody really knows.  Many people would be shocked to learn that the stock market lost nearly 70% of its real value between 1966 and 1982!  Stock "experts" tend to downplay the serious risks of the stock market.  Recommendation:  Broadly diversify your investments in various sectors and countries to minimize your risk.  If you're young, stay very patient and you'll probably profit in the long run; most others should lean towards MMAs and inflation-protected bonds.
3. Take control -- don't settle for what's offered to you. Some financial salespeople are able to charm people into making subpar investments while the salesperson gets a commission.  Never let your retirement account do poorly because it's being funneled into investments that aren't right for you.  Your investing options are much broader than what Mr. Smiling Salesperson offers you.  You have a great deal of control!
4. Give stocks, not money to charities. When you give stocks (or tangible assets such as artwork or collectibles) that have appreciated in value, you'll avoid capital gains tax (which is 15% for those in the 25% income tax bracket or higher) when you sell them. And you can still deduct the gift's full current market value. Be sure the charity provides you with a record of the asset's value on the transfer date. Note: You must hold the asset for longer than one year, and you can deduct no more than 30% of your AGI (Adjusted Gross Income.)

(Next Gem: A Tax-Free Joke)

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