Home ownership is a dream that many Americans share. However, a mortgage can be an enormous burden, and paying it off asap is the first item on many consumers' to-do list. But competing with the desire to own a home "free and clear" is a need to invest for retirement, children's college education, and other goals. Setting aside some extra cash for these goals may mean sacrificing other opportunities. So how do you choose?

Evaluate the Opportunity Costs
Deciding between prepaying your mortgage and investing your extra cash isn't easy, because each option has advantages and disadvantages. But you can start by weighing what you'll gain financially by choosing one option versus the others. In economic terms, this is known as evaluating the opportunity costs.

Here's an example. Let's assume that you have a $300,000 balance and 20 years remaining on your 30-year mortgage, and you're paying 6.25% interest. If you were to put an extra $400 toward your mortgage each month, you would save approximately $62,000 in interest, and pay off your loan almost 6 years early.

By making extra payments and saving all of that interest, you'll clearly be gaining a lot of financial ground. But before you opt to prepay your mortgage, you still have to consider what you might be giving up by doing so--the opportunity to potentially profit even more from investing.

To determine if you would come out ahead if you invested your extra cash,start by looking at the after-tax rate of return you can expect from prepaying your mortgage. This is generally less than the interest rate you're paying on your mortgage, once you take into account any tax deduction you receive for mortgage interest. Once you've calculated that figure, compare it to the after-tax return you could receive by investing your extra cash.

For example, the after-tax cost of a 6.25% mortgage would be approximately 4.5% if you were in the 28% tax bracket and were able to deduct mortgage interest on your federal income tax return (the after-tax cost might be even lower if you were also able to deduct mortgage interest on your state income tax return). Could you receive a higher after-tax rate of return if you invested your money instead of prepaying your mortgage?

Keep in mind that the rate of return you'll receive is directly related to the investments you choose. Investments with the potential for higher returns may expose you to more risk, so take this into account when making your decision.

Other Points to Consider
While evaluating the opportunity cost is important, you'll also need to weigh many other factors. The following list of questions may help you decide which option is best for you.

• What's your mortgage interest rate? The lower the rate on your mortgage, the greater the potential to receive a better return through investing.
• Does your mortgage have a prepayment penalty? Most mortgages don't, but check before making extra payments.
• How long do you plan to stay in your home? The main benefit of prepaying your mortgage is the amount of interest you save over the long term; if you plan to move soon, there's less value in putting more money toward your mortgage.
• Will you have the discipline to invest your extra cash rather than spend it? If not, you might be better off making extra mortgage payments.
• Do you have an emergency account to cover unexpected expenses? It doesn't make sense to make extra mortgage payments now if you'll be forced to borrow money at a higher interest rate later. And keep in mind that if your financial circumstances change--if you lose your job or suffer a disability, for example--you may have more trouble borrowing against your home equity.
• How comfortable are you with debt? If you worry endlessly about it, give the emotional benefits of paying off your mortgage extra consideration.
• Are you saddled with high balances on credit cards or personal loans? If so, it's often better to pay off those debts first. The interest rate on consumer debt isn't tax deductible, and is often far higher than either your mortgage interest rate or the rate of return you're likely to receive on your investments.
• Are you currently paying mortgage insurance? If you are, putting extra toward your mortgage until you've gained at least 20% equity in your home may make sense.
• How will prepaying your mortgage affect your overall tax situation? For example, prepaying your mortgage (thus reducing your mortgage interest) could affect your ability to itemize deductions (this is especially true in the early years of your mortgage, when you're likely to be paying more in interest).
• Have you saved enough for retirement? If you haven't, consider contributing the maximum allowable each year to tax-advantaged retirement accounts before prepaying your mortgage. This is especially important if you are receiving a generous employer match. For example, if you save 6% of your income, an employer match of 50% of what you contribute (i.e., 3% of your income) could potentially add thousands of extra dollars to your retirement account each year. Prepaying your mortgage may not be the savviest financial move if it means forgoing that match or shortchanging your retirement fund.
• How much time do you have before you reach retirement or until your children go off to college? The longer your time frame, the more time you have to potentially grow your money by investing. Alternatively, if paying off your mortgage before reaching a financial goal will make you feel much more secure, factor that into your decision.

The Middle Ground
If you need to invest for an important goal, but you also want the satisfaction of paying down your mortgage, there's no reason you can't do both. It's as simple as allocating part of your available cash toward one goal, and putting the rest toward the other. Even small adjustments can make a difference. For example, you could potentially shave years off your mortgage by consistently making biweekly, instead of monthly, mortgage payments, or by putting any year-end bonuses or tax refunds toward your mortgage principal.

And remember, no matter what you decide now, you can always reprioritize your goals later to keep up with changes to your circumstances, market conditions, and interest rates.

Loose items in your car are easy targets for thieves unless you take security more seriously. Items most likely to be stolen are small, expensive electronics such as: portable navigation devices, cell phones, portable DVD & music players, and valuable sports equipment (i.e. golf clubs, baseball glove, tennis racquet).

Although it may seem obvious, the best way to protect your possessions is to lock your car doors. And don't leave any windows (or the sunroof) open...not even during the dog days of summer!

To prevent crimes of opportunity, never leave valuable items in plain sight. Today's thieves don't usually bother tearing CD players out of the dashboard anymore (although some still try) because it's so much easier to grab a detachable GPS navigation device off the dashboard or to swipe an mp3 player or cell phone that was left on the seat. Even though it may be a hassle, lock your valuables in the trunk or (better yet) take them with you.

You may be surprised to learn that personal property in your car is generally not covered by your auto insurance policy unless it's permanently installed (e.g., a factory radio). However, personal items are generally covered by your homeowners or renters insurance, subject to a deductible, and up to certain limits.

If you routinely carry expensive items in your car and need additional coverage, look into purchasing a rider or endorsement to your homeowners or renters policy. And keep in mind that some policies will provide coverage only when signs of forced entry are present--another reason to lock your vehicle!

Because many homes aren't designed to accommodate our parents' and grandparents' changing physical needs, it can be challenging for people with disabilities to live independently. Fortunately, homes can be modified to remove these barriers and to reduce reliance on caregivers. For older individuals, home modifications can delay or even prevent the need for costly care in a nursing home or assisted-living facility.

Improvement options will depend on individual needs and physical concerns. But here's a broad look at some of the home modifications that might help make day-to-day living safer and easier for you or a loved one.

Inside the Home

Kitchen

• Remove cabinet doors to make it easier to see and reach items
• Use turntables inside cabinets to reach supplies easily
• Lower countertop surfaces and kitchen cabinets to make them more accessible
• Install a cook top and a low wall oven instead of using a range; install an adjustable mirror over the stove to make viewing cook top from a wheelchair easier

Bathroom

• Install a raised toilet with attached handrails (portable seats are also available if replacing the toilet is impractical)
• Cover sink handles with rubber grips to make it easier to turn the water on and off
• Install grab bars or poles near the toilet and shower
• Replace bathtub with low-threshold shower

Other living areas

• Replace door knobs with lever-style handles, or install door knob covers that are easier to grip and turn
• Add nightlights to prevent nighttime falls
• Remove throw rugs and thick doormats; replace padded carpet with thinner, level-loop carpet to prevent tripping and facilitate wheelchair or walker navigation
• Widen doorways, remove doors, or install special hinges that allow doors to open wider
• Install a ceiling lift device that will allow independent movement around the home
• Install a stair lift or an in-home elevator

Outside the Home

• Apply nonskid surfaces to garage floors, decks, stairs, and walkways
• Install handrails on both sides of stairs
• Replace standard exterior lights with motion-sensitive or photo-sensitive lights
• Construct an entrance/exit ramp

Paying for Home Modifications
Many home modifications are simple and inexpensive, but if you need to remodel extensively or hire a contractor, you may need help paying for improvements. Fortunately, financial help is available from public and private agencies and charities. For example, states and communities may offer special financing or grant programs, and charities often organize repair or improvement projects. To find help available in your community, contact your local Area Agency on Aging.

Tax Breaks
If you itemize deductions on your federal income tax return, you may be able to deduct home improvements that are primarily for medical care and prescribed by your doctor. However, if an improvement increases the value of your home, it may be only partially deductible.

Some states also offer tax breaks to their residents, including sales tax exemptions, deductions, or tax credits; local property tax credits or abatements may be available as well. For more information on these specific programs, talk to your local financial professional.

We know your story...you vaguely remember signing a piece of paper every year at college registration time. Now that you've graduated, it's all become painfully clear--those pieces of paper were promissory notes detailing your student loan obligations. These loans aren't going to magically disappear, and you should repay them as quickly (and easily) as possible. So whether you have a small sum or a small fortune to pay off, you need to brush up on student loan basics.

Remember the Grace Period
After you graduate, you'll probably have a lot to think about--choosing where to live, finding a job, renting an apartment. Luckily, you don't have to add student loans to your list, too, at least not for now. Thanks to the grace period built into most student loans, you'll likely get anywhere from six to nine months before you need to begin repaying your loans. This time allows you to examine the various repayment options before the drudgery begins.

Understand Your Repayment Options
Gone are the days when your only repayment option consisted of fixed, equal payments spread over a 10-year term. Though this is certainly one option, it's not the only one. Because of the increasing number of students who require student loans to finance their education, as well as the increasing amount of their debt, many lenders offer flexible repayment plans to help students manage this large financial responsibility.

• Standard repayment plan: This is the original repayment plan. With a standard plan, you generally pay a fixed amount each month for up to 10 years.
  
  
• Graduated repayment plan: With a graduated plan, your payments start out low in the early years of the loan but increase in later years (the term is still 10 years). This plan is for borrowers low current incomes (e.g., recent college graduates) who expect their incomes to increase in the future. Because of the longer repayment period, you will pay more for total interest for the loan.
  
  
• Extended repayment plan: The time you have to repay your loan is extended up to 30 years, depending on the loan amount. Your fixed monthly payment is lower than it would be under the standard plan, but again, you'll ultimately pay more for your loan because of the interest that accumulates under the longer repayment period.
  
  
• Income-sensitive repayment plan: With an income-sensitive plan, your monthly loan payment is based on your annual income. As your income increases or decreases, so do your payments. If you're married, your joint income is used to calculate your required monthly payment. Not every lender offers this option.
  
  
• Loan consolidation: Loan consolidation is technically not a repayment option, but it does overlap. With loan consolidation, you combine several student loans into one loan, sometimes at a lower interest rate. Thus, you can write one check each month. You need to apply for loan consolidation, and different lenders have different rules about which loans qualify for consolidation. However, with most loan consolidations, you can choose an extended repayment and/or a graduated repayment plan in addition to a standard repayment plan.

Which Option is Best?
To pick the best repayment option, you'll need to determine the amount of discretionary income that you have to put toward your student loan each month. Of course, this requires you to make a budget and track your monthly income and expenses.

In addition to inquiring about repayment options, ask whether your lender offers any special discounts for on-time loan repayment. For example, some lenders may shave a percentage point off your interest rate if you allow them to directly debit your checking account each month. Or, they may waive some monthly payments after receiving on-time payments for a certain length of time.

Consider a Deferment, Forbearance, or Loan Cancellation if You Can't Pay
At times, you may find it financially difficult or impossible to repay your student loan. The worst thing that you can do is bury your head in the sand and ignore your payments (and your lender) completely. The best thing that you can do is contact your lender and apply for a deferment, forbearance, or cancellation of your loan. Student loan repayment cannot be avoided...not even in bankruptcy!

• Deferment: With a deferment, your lender grants you a temporary reprieve from repaying your student loan based on a specific condition, such as unemployment, temporary disability, military service, or a return to graduate school on a full-time basis.
  
  
• Forbearance: With a forbearance, your lender grants you permission to reduce or stop your loan payments for a certain period of time at its discretion (one common reason is economic hardship).
  
• 
  
• Cancellation: With a cancellation, your loan is permanently wiped off your list of financial obligations. It's not easy to qualify for a cancellation, though. Situations when this may be allowed are the death or permanent total disability of the borrower, or if the borrower takes a job teaching needy populations in certain geographic areas.
  

These additional options are not automatic. You'll need to fill out the appropriate application from your lender, attach any supporting documentation, and follow up to make sure that your application has been processed correctly.

Keep Track of Your Paperwork
If your idea of organization is stuffing your random assortment of student loan papers into your sock drawer, think again. Repaying your student loans is a serious matter, and you'll need to stay on top of it. It's important to keep accurate, accessible records. Open a file folder for each loan, and file any accompanying paperwork there, such as copies of promissory notes, coupon booklets, correspondence from your lender, deferment and/or forbearance paperwork, and notes of any phone calls.

The Student Loan Interest Deduction

On the bright side, you might be able to deduct on your federal tax return some of the student loan interest that you pay. You must have incurred the loans when you were at least a half-time student, and you can't take the deduction if you're claimed as a dependent on someone else's tax return.

If you're like most people, you take your car to a professional mechanic for routine maintenance. You see a doctor when you have health exams. When the need for legal counsel arises, you consult an attorney. We all regularly rely on the expertise of others, and it's no different with matters of personal finances. In fact, we believe most people could benefit from working with a qualified financial professional. Here are six good reasons why:

1. You Don't Know What You Don't Know
No one is an expert on every subject. Managing finances on a day-to-day basis is one thing; implementing a comprehensive investment plan to fund your retirement while setting aside funds for your child's education is something else. That doesn't mean that you're not capable of doing it, only that you should not underestimate the expertise needed to put together an effective plan. If you're going to go at it alone, you need to take considerable time to educate yourself, and that brings us to the next point...

2. You Have Good Intentions, But Never Set Aside the Time
There's an entire industry built around providing individuals with the tools they need to do their own financial planning. Books, magazines, websites, blogs, calculators, worksheets, and videos all empower individuals to take a more active role in their financial future, whether they're working alone or with a financial professional. Not one of these resources, however, will help unless you set aside the time to research and apply it to your own situation. Working with a financial professional enables you to take active steps and to and offload the time commitment to a professional.

3. Doing Everything Yourself Isn't Efficient
There's a long list of things that we could do by ourselves but instead choose to pay someone else to do for us. For example, you could paint your house, but you may be happy to pay someone else to do it. Why? It's more efficient. You can spend the time working on other things and, if you choose the right professional, it will probably be done faster and better than if you did it yourself. The same goes for working with a financial advisor.

4. You Are Not Objective
It's hard to look at your own situation without any bias. Having someone else with experience analyze your financial condition can be extremely helpful. And, in cases where you and another person (i.e. spouse, sibling, or parent) aren't on the same page, an advisor can listen to both parties' concerns, identify underlying issues, and help you find common ground.

5. Keeping Up With Change is a Full-Time Job
Last year alone, there were four major tax legislations signed into law. Even seasoned financial professionals have had a difficult time keeping up with the changes. Not understanding how these changes might affect your financial plan could be dangerous, but understanding the changes takes time and effort (see reason number 2).

6. You Can See the Trees, But Not the Forest
A good financial professional can help you see the big picture. He or she can show you how your financial goals are related--for example, how saving for your child's college education might affect your ability to invest for retirement. He or she can work with you to prioritize your goals, implement specific strategies, and choose suitable products or services. A financial professional can also stay on top of your plan to make sure it remains on track, recommending changes when conditions, or your circumstances, dictate.

Graduate school costs can be challenging. While the bank of Mom and Dad may have helped fund an undergraduate education, students considering graduate school are more likely to be on their own financially. Unless you are independently wealthy, here are some suggestions for obtaining financial help.

Loans, Loans, Loans
According to the College Board, the average graduate student funds 69% of his or her education costs with loans. Students common borrow funds from private lenders or the federal government. Uncle Sam's three major loan programs--all available to graduate students--are the subsidized and unsubsidized Stafford loan, the subsidized Perkins loan, and the unsubsidized PLUS loan. "Subsidized" means the government pays the accruing interest during school and deferment (loan postponement) periods. Stafford and Perkins loans are only available to students who demonstrate financial need.

In 2007, graduate students may be eligible to borrow up to $8,500 in subsidized Stafford loans, up to $12,000 in unsubsidized Stafford loans, and up to $6,000 in Perkins loans. Currently, the interest rate on new Stafford loans is fixed at 6.8% and 5% for Perkins loans. And under the PLUS loan program, graduate students can borrow up to the full cost of their education (minus any other financial aid received) at a current fixed interest rate of 8.5%. To be eligible for federal student loans, you must be attending graduate school on at least a half-time basis. Then you must file the government's aid application, called the Free Application for Federal Student Aid. You can file it online at www.fafsa.ed.gov.

Students can also obtain loans from banks or other private lenders, though such loans typically carry higher, variable rates of interest.

Scholarships and Grants
Most scholarship and grant aid at the graduate level comes from the school itself. However, this aid is often awarded on the basis of merit rather than need. To investigate, contact the university's financial aid office as well as the specific office of the graduate program you will be entering. Many scholarships and grants (like teaching fellowships or research grants) are awarded at the departmental level, so your chances may heavily depend on what subject area you'll be studying.

Employer Educational Assistance
Some companies offer tuition reimbursement, which can be a great source of "free money." But there are often strings attached, like maintaining a certain grade point average or staying with the company for a number of years. The first $5,250 of employer-provided tuition benefits is exempt from federal income tax.

Education Tax Benefits
Three federal education tax benefits might help defray your expenses in 2007:

The Lifetime Learning credit is worth up to $2,000 for tuition and fees. To qualify, your income must be below $57,000 (single) or $114,000 (married filing jointly).

The deduction for qualified higher education expenses lets you deduct $4,000 for tuition and fees if your income is below $65,000 (single) or $130,000 (married filing jointly). If your income is more than that but less than $80,000 (single) or $160,000 (married filing jointly), you can deduct $2,000. This deduction is only available for 2007, and it can't be taken in the same year as the Lifetime credit.

The student loan interest deduction lets you deduct up to $2,500 of student loan interest each year. To qualify, your income must be below $70,000 (single) or $140,000 (married filing jointly).

You're contributing the maximum to a 401(k) and also maxing out your Roth or traditional IRA. But, as a master spendthrift, you still have additional dollars you could save to ensure your retirement is everything you hope for. What options do you have?

Make Sure You Have a Life Today
Aggressive saving is a habit that all financially responsible people share. But don't get carried away. Even though you'll want a fulfilling retirement in 2050, don't neglect your quality of life today. While you're young, remember to also spend money on current experiences with others: fulfilling hobbies, international travels, and group outdoor adventures should be at the top of your list.

Besides, if you're responsible enough to max out a 401k and a Roth IRA, then you probably also have a pile of cash sitting quietly in a savings account. You've setup an emergency fund already and are now looking for additional ways to put your dollars to work. If this is your situation, then trust us, you can afford to indulge yourself in a hot-air-balloon ride, a week in Spain, or a few days at the spa.

And after all of that, if you've still got some cash left over (lucky you!), then here are some other ways to set aside long-term dollars for retirement.

Are You Really Maxing Out Your 401(k) and IRA?
IRAs and 401(k)s have real advantages when it comes to saving for retirement. So, before you go any further, make sure you're really contributing all you can.

In 2007, most individuals can contribute up to $15,500 to a 401(k) plan, and up to $4,000 to a traditional or Roth IRA. What's more, if you file a joint tax return with your spouse, your spouse may be able to make a full IRA contribution, even if he or she has little or no taxable compensation.

Look at Deferred Annuities
If you are looking beyond 401(k)s and IRAs, one option you may be aware of is a deferred annuity. Deferred annuities are generally funded with after-tax dollars, but earnings are tax deferred, which means you don't pay tax until you take a distribution from the annuity. There's also no annual limit on contributions to an annuity.

The tax deferral offered by a deferred annuity is a nice feature, but it comes with some trade offs that you'll need to weigh carefully:

• There are usually costly fees such as annual expenses, investment management fees, and insurance expenses
• A surrender charge may be imposed if you withdraw funds within a certain period of time
• A 10% federal penalty tax (in addition to any regular income tax) may apply if you withdraw funds from an annuity before age 59½
• Investment gains are taxed at ordinary income tax rates, not at lower capital gains rates

Annuities do have some unique benefits beyond tax deferral. With annuities, you can elect an annual payment amount that is guaranteed for the rest of your life (the guarantee is subject to the payment ability of the issuing institution)--this relative degree of certainty can be psychologically and financially comforting. In addition, annuities may offer some creditor protection under state law.

Taxable Investment Accounts
Your other basic option is to invest through a taxable investment account. The lower federal income tax rates that apply to long-term capital gains and qualifying dividends go a long way toward taking the bite out of holding investments outside of a tax-advantaged retirement account like a 401(k) or IRA. And, a taxable investment account offers one enormous advantage: You gain a tremendous amount of flexibility. You can choose from a virtually unlimited selection of specific investments, and there's no federal penalty for withdrawing funds before age 59½.

Investment options worth mentioning:

• Index mutual funds and exchange-traded funds (ETFs) trade infrequently and therefore tend to have low annual taxable distributions
• Tax-free municipal bonds and municipal bond funds generate income that is free from federal and/or state income tax

Remember the Big Picture
Your investment decisions should be based on your individual goals, time frame, risk tolerance, and investment knowledge. You should evaluate every investment decision with an eye toward how the investment will fit into your overall investment portfolio, and whether it will meet your general asset allocation needs. A financial professional can be invaluable in helping you evaluate your options.

Your bank account is empty, credit cards are maxed out, and you're getting late notices for accounts that don't belong to you. It's a terrifying situation. Now your heart starts pounding because despite your best efforts of identity protection, many aspects of its protection are increasingly out of your control...Internet hackers, internal employee misconduct, and third-party scams are running rampant. This "uncontrollable" theft is becoming more common; last week, TJ Maxx Stores disclosed a massive theft of credit card data from more than 45 million of its customers.

So what exactly can you do after you identity has been stolen?

Time is Money
To minimize your losses, act fast. Contact companies in this order:

1. Your credit card companies
2. Your bank
3. The three major credit bureaus
4. Local, state, or federal law enforcement authorities

Your Credit Card Companies
Credit card companies are getting better at detecting fraud; in many cases, if they spot activity outside the mainstream of your normal card usage, they'll call you to confirm that you made the charges. But the responsibility to notify them of lost or stolen cards is still yours.

If you do so in a reasonable time (within 30 days after you discover the loss), you won't be responsible for more than $50 per card in fraudulent charges. Ask that the accounts be closed at your request, and open new accounts with password protection.

If an identity thief opens new accounts in your name, you'll need to prove it wasn't you who opened them. Ask the creditors for copies of application forms or other transaction records to verify that the signature on them isn't yours.

Whether the identity thief compromises an existing account or opens a new one fraudulently, the creditor involved may want you to fill out a fraud affidavit. Most will accept the uniform affidavit form available from the Federal Trade Commission (FTC); you may obtain it from the FTC at www.ftc.gov.

Follow up your initial creditor contacts with letters indicating the date you reported the loss or theft. Watch your subsequent monthly statements from the creditor; if any fraudulent charges appear, contest them in writing.

Your Bank
If your debit (ATM) card is lost or stolen, you won't be held responsible for any unauthorized withdrawals if you report the loss before it's used. Otherwise, the extent of your liability depends on how quickly you report the loss:

• If you report the loss within two business days after you notice the card is missing, you'll be held liable for up to $50 of unauthorized withdrawals. (If the card doubles as a credit card, you may not be protected by this limit.)
• If you fail to report the loss within two days after you notice the card is missing, you can be held responsible for up to $500 in unauthorized withdrawals.
• If you fail to report an unauthorized transfer or withdrawal that's posted on your bank statement within 60 days after the statement is mailed to you, you risk unlimited loss.

If your checkbook is lost or stolen, stop payment on any outstanding checks, then close the account and open a new one. Dispute any fraudulent checks accepted by merchants in order to prevent collection activity against you. And notify the check-guarantee bureaus:

• Check Rite (800) 766-2748
• ChexSystems (800) 328-5121
• CrossCheck (800) 552-1900
• Equifax-Telecredit (800) 437-5120
• NPC (800) 526-5380
• SCAN (800) 262-7771
• Tele-Check (800) 366-2425

The Three Major Credit Bureaus
If your credit cards have been lost or stolen, call the fraud number of any one of the three national credit reporting agencies:

1. Equifax (888) 766-0008
2. Experian (888) 397-3742
3. TransUnion (800) 680-7289

Note: Although you should only need to contact one of the three bureaus (the one you call is required to contact the other two), we recommend you call all three bureaus.

Next, place a fraud alert on your credit report. If your credit cards have been lost or stolen, and you think you may be victimized by identity theft, you may place an initial fraud alert on your report. An initial fraud alert entitles you to one free credit report from each credit bureau, and remains on your credit report for 90 days. If you become a victim of identity theft (an existing account is used fraudulently or the thief opens new credit in your name), you may place an extended fraud alert on your credit report once you file a report with a law enforcement agency. An extended fraud alert entitles you to two free credit reports within 12 months from each credit bureau, and remains on your credit report for 7 years.

Once a fraud alert has been placed on your credit report, any user of your report is required to verify your identity before extending any existing credit or issuing new credit in your name. For extended fraud alerts, this verification process must include contacting you personally by telephone at a number you provide for that purpose.

If you live in one of the handful of states that allow you to "freeze" your credit report, do so. Once you do, no one--creditors, insurers, and even potential employers--will be allowed access to your credit report unless you "thaw" it for them.

If your state allows you to freeze your credit report, you must contact all three major credit reporting agencies. In some cases, victims of identity theft are not charged a fee to freeze and/or thaw their credit reports, but the laws vary from state to state. Contact the office of the attorney general in your state for more information.

If you discover fraudulent transactions on your credit reports, contest them through the credit bureaus. Do so in writing, and provide a copy of the identity theft report you file. You should also contest the fraudulent transaction in the same fashion with the merchant, bank, or creditor who reported the information to the credit bureau. Both the credit bureaus and those who provide information to them are responsible for correcting fraudulent information on your credit report, and for taking pains to assure that it doesn't resurface there.

Law Enforcement Agencies
While the police may not catch the person who stole your identity, you should file a report about the theft with a federal, state, or local law enforcement agency. Once you've filed the report, get a copy of it; you'll need it in order to file an extended fraud alert with the credit bureaus. You may also need to provide it to banks or creditors before they'll forgive any unauthorized transactions.

When you file the report, give the law enforcement officer as much information about the crime as possible: the date and location of the loss or theft, information about any existing accounts that have been compromised, and/or information about any new credit accounts that have been opened fraudulently. Write down the name and contact information of the investigator who took your report, and give it to creditors, banks, or credit bureaus that may need to verify your case.

If the theft of your identity involved any mail tampering (such as stealing credit card offers or statements from your mailbox, or filing a fraudulent change of address form), notify the U.S. Postal Inspection Service. If your driver's license has been used to pass bad checks or perpetrate other forms of fraud, contact your state's Department of Motor Vehicles. If you lose your passport, contact the U.S. Department of State. Finally, if your Social Security card is lost or stolen, notify the Social Security Administration.

Follow Through
Once resolved, most instances of identity theft stay resolved. But stay alert: monitor your credit reports regularly, check your monthly statements for any unauthorized activity, and be on the lookout for other signs (such as missing mail and debt collection activity) that someone is pretending to be you.

As the grizzled duty sergeant used to say on the televised police drama, "Be careful out there." The identity you save may be your own.

Emerging markets have been of enormous interest to our clients in recent years, and none have created a greater stir than a group of countries collectively labeled BRIC (Brazil, Russia, India, and China).

Why All the Fuss?
The recent interest is all about the numbers. Investors have looked at development in BRIC countries, population statistics, and the global economy, and many have concluded that the long-term potential in BRIC is the next great worldwide growth story.

As a result, indexes that attempt to reflect BRIC performance have soared in the last several years. The Dow Jones BRIC 50, which includes the largest and most liquid securities of each country, rose by more than 300% between December 31, 2002, and mid-2006 (source: Dow Jones).

Several factors are driving the newfound attention to BRIC investments:

Globalization and growth--Worldwide demand for energy and other commodities, the outsourcing phenomenon, and widespread access to global capital have helped fuel the BRIC countries' growth. India dominates service outsourcing, Brazil and Russia have vast energy and mineral resources, and China has developed into the world's manufacturing plant. India's economy is growing at 8.5% a year, and China's at more than 10.5%, compared to 3.1% U.S. growth (source: 2006 CIA World Factbook).

Huge populations, future buyers--Together, the BRIC countries represent 42% of the world's population, again according to the CIA World Factbook. That number represents enormous untapped future purchasing power. It gives BRIC countries the potential for even more rapid expansion if their economies continue to develop and the benefits reach a greater percentage of their populations.

Reduced reliance on foreign debt--Growth has helped BRIC countries pay down loans incurred during previous economic crises, though the potential for default on that debt could still present an investment risk.

Riding the Roller Coaster
Despite the recent success of these regions--or because of it--money managers are divided on how long the rise of emerging markets can continue without a significant correction. Because commodities are so important to the BRIC economies, any slowdown in worldwide growth and therefore demand could have a significant impact on investments there. Other risks exist as well. All four countries have experienced political instability, currency fluctuations, and/or economic problems. Investors who were affected won't soon forget Russia's 1998 economic crisis or Brazil's bouts with rampant inflation in the late 1980s and early 1990s.

Also, economic growth rates don't necessarily translate directly into stock market returns; until the last year or so, China's stock market suffered serious multiyear losses.

BRIC Investing and Beyond
You have many ways to take advantage of the projected growth in these regions. One of the most popular is index mutual funds or exchange-traded funds (ETFs), which may be based on an index for an individual country or one that's BRIC-wide. You might also want to explore beyond the BRICs. Other emerging markets might have great growth potential but might not yet have attracted as much investor attention. Diversified emerging-markets funds often have a large exposure to the BRIC countries. The number of BRIC-specific companies is relatively limited; including other emerging markets as well as the BRICs gives a fund manager an expanded universe of securities from which to select.

If you're interested in individual stocks, some of the largest BRIC firms are listed on U.S. exchanges via American Depositary Receipts (ADRs).

The historical volatility of emerging markets means you should take a long-term view, and be prepared for the possibility of ups and downs along the way. A qualified financial professional can help you decide whether emerging markets are appropriate for your risk tolerance, time horizon, and overall portfolio, and he/she can suggest how to balance the potential risks and rewards.

Identity thieves can empty your bank account, max out your credit cards, open new accounts in your name, and purchase furniture, cars, and even homes on the basis of your credit history. And if an identity thief gives your personal information to the police during an arrest and then doesn't show up for a court date, you can be arrested and jailed.

There are basically two types of identity theft:

1. Account takeover - a thief gets your existing credit or debit cards (or even just the account numbers and expiration dates) and goes on a shopping spree at your expense
2. Application fraud - a thief gets your Social Security number and uses it (along with other information about you) to obtain new credit in your name

You may never be able to completely prevent either type of identity theft, but here are some steps you can take to help protect yourself from becoming a victim.

Check Yourself Out
It's important to review your credit report periodically. Check to make sure that all the information is correct, and stay on the lookout for any fraudulent activity.

As of September 2005, you can get your credit report for free once a year. To do so, contact the Annual Credit Report Request Service online at www.annualcreditreport.com or call (877) 322-8228.

If you need to correct any information or dispute any entries, contact the three national credit reporting agencies:

1. Equifax: www.equifax.com 1-800-525-6285
2. Experian: www.experian.com 1-888-397-3742
3. TransUnion: www.transunion.com 1-800-680-7289

Secure Your Social
Your most important personal identifier is your Social Security number (SSN). Guard it carefully. Never carry your Social Security card with you unless you'll need it that day. The same goes for other forms of identification (for example, health insurance cards) that display your SSN. If your state uses your SSN as your driver's license number, request an alternate number.

Do not have your SSN preprinted on your checks, and don't let merchants write it on your checks. Don't give it out over the phone unless you initiate the call to an organization you trust. Ask the three major credit reporting agencies to scramble it on your credit reports. Try to avoid listing it on employment applications; offer instead to provide it during a job interview.

Don't Leave Home With It
Most of us carry a checkbook and several credit cards, debit cards, and telephone cards with us all the time. That's a bad idea because if your wallet or purse is stolen, the thief will have a treasure chest of new toys to play with.

Carry only the cards and/or checks you'll need for any one trip. And keep a written record of all your account numbers, credit card expiration dates, and the telephone numbers of the customer service and fraud departments in a secure place--at home.

Keep Your Receipts
When you make a purchase with a credit or debit card, you're given a receipt. Don't throw it away or leave it behind; it may contain your credit or debit card number. And don't leave it in the shopping bag inside your car while you continue shopping; if your car is broken into and the item you bought is stolen, your identity may be as well.

Save your receipts until you can check them against your monthly credit card and bank statements, and watch your statements for purchases you didn't make.

When You Toss It, Shred It
Before you throw out any financial records such as credit or debit card receipts and statements, canceled checks, or even offers for credit you receive in the mail, shred the documents, preferably with a cross-cut shredder. If you don't, you may find the thief going through your dumpster was looking for more than last week's takeout.

Keep a Low Profile
The more your personal information is available to others, the more likely you are to be victimized by identity theft. While you don't need to become a hermit in a cave, there are steps you can take to help minimize your exposure:

• Stop telephone calls from national telemarketers by listing your telephone number with the Federal Trade Commission's National Do Not Call Registry by calling (888) 382-1222 or registering online at www.donotcall.gov.
• Remove your name from most national mailing and e-mailing lists, as well as most telemarketing lists. Write the Direct Marketing Association at 1120 Avenue of the Americas, New York, NY 10036-6700, or register online at www.dmaconsumers.org.
• Remove your name from marketing lists prepared by the three national consumer reporting agencies. Call (888) 567-8688 or register online at www.optoutprescreen.com.
• When given the opportunity to do so by your bank, investment firm, insurance company, and credit card companies, opt out of allowing them to share your financial information with other organizations.
• You may even want to consider having your name and address removed from the telephone book and reverse directories.
• Never provide any personal information via phone, letter, or e-mail unless you initiated the transaction. Legitimate businesses should already have your information on file, and will not call you or e-mail you to ask for it.

Take a Byte Out of Crime
Whatever else you may want your computer to do, you don't want it to inadvertently reveal your personal information to others. Take steps to help assure that this won't happen.

Install a firewall to prevent hackers from obtaining information from your hard drive or hijacking your computer to use it for committing other crimes. This is especially important if you use a high-speed connection that leaves you continuously connected to the Internet. Moreover, install virus protection software and update it on a regular basis.

Try to avoid storing personal and financial information on a laptop; if it's stolen, the thief may obtain more than your computer. If you must store such information on your laptop, make it as difficult as possible for a thief by protecting these files with a strong password--one that's 6 to 8 characters long, and that contains letters (upper and lower case), numbers, and symbols.

Don't Talk to Strangers
Opening e-mails from people you don't know, especially if you download attached files or click on hyperlinks within the message, can expose you to viruses, infect your computer with "spyware" that captures information by recording your keystrokes, or lead you to "spoofs" (websites that replicate legitimate business sites) designed to trick you into revealing personal information that can be used to steal your identity.

If you wish to visit a business's legitimate website, use your stored bookmark or type the URL address directly into the browser. If you provide personal or financial information about yourself over the Internet, do so only at secure websites; to determine if a site is secure, look for a URL that begins with "https" (instead of "http") or a lock icon on the browser's status bar.

Wipe It Clean
When it comes time to upgrade to a new computer, remove all your personal information from the old one before you dispose of it. Dragging all files to the "trash" isn't sufficient to do the job; "deleted'" hard drive data can easily be recovered with common computer programs. Instead, overwrite the hard drive by using a "wipe" utility program. The minimal cost of investing in this software may save you from being truly wiped out by an identity thief down the road.

While the axiom "necessity is the mother of invention" usually applies to the world of tangible goods, lately it applies to the world of health-care services, too. Rapidly escalating costs are forcing governments and the private sector to get creative to reduce the number of uninsured individuals. Solutions have ranged from health savings accounts to private high-deductible health plans to calls for universal coverage. Now comes another legislative trend: States are enacting an expanded definition of "dependent" that enables young adults to stay on their parents' health plans well into their 20s.

What's behind this trend?
It's a typical scenario: "Children" are covered by their parents' health insurance while they're full-time college students, but after graduation, the "children" often decide they can't afford their own health coverage. Instead, any discretionary income that could be used for health insurance is swallowed up by student loans, credit card debt, car insurance, and rent.

According to a 2005 published report from the U.S. Census Bureau (the latest year for which figures are available), about 30% of young adults ages 18 to 24 are uninsured, and more than 25% of individuals ages 25 to 34 lack health-care coverage. Along with the cost factor, it's believed that many young adults choose to forgo health insurance because of the invincibility factor--they're in relatively good health and just don't expect to get seriously sick or injured.

Enter the states
To help this fastest-growing group of uninsured, a handful of states have passed legislation extending the time that a child may be considered a dependent for insurance purposes. Some states already extend this age if a child has a mental or physical disability. But now, states are expanding the age definition of dependent for purposes of health-care coverage with no requirement that a child be disabled. The typical age limit is 25 (though in New Jersey, a child can now remain on his or her parents' health plan until age 30, if certain requirements are met).

States that offer this coverage typically allow private insurers to charge higher premiums and impose other restrictions (e.g., the child must be unmarried, reside in the state, live with his or her parents). Since extended health coverage is relatively new, it remains to be seen what other tweaks states will allow private insurers to make. For the most part, though, insurers have viewed this age demographic as an attractive risk due to the overall good health of this group.

Is the extra cost worth it?
Assuming the "child" meets the requirements, keeping him or her on the family health plan after college may be a good idea. For a few hundred extra dollars per month, the parent gains peace of mind knowing the child will be covered (and the parent will be off the hook) for that skiing accident or emergency appendectomy. Otherwise, an unexpected medical crisis could put a big crimp in the child's financial future, and most likely the parents' too.

Loaning money to a member of your family may seem like the right thing to do. After all, what could go wrong? Your son, sister, father, or cousin really needs your help, and there's no question that he or she will pay you back.

Or is there? Lending money to anyone, even someone you trust, is risky. No matter how well-intentioned the borrower is, there's always the chance that he or she won't be able to pay you back, or will prioritize other debts above yours.

When deciding, consider these tips:

• Don't lend money you can't afford to lose. If you make the loan, will you still be able to meet your savings goals? If the loan isn't paid back, will the financial effect be small or large?
• Avoid becoming an ATM. Relatives (especially your children) may ask you for a loan because it's convenient, but they may be able to obtain the money easily elsewhere. Explore other options first.
• Think through the emotional consequences. Will you be able to forgive and forget if loan payments are missed or if the loan isn't paid in full? How hurt will you be if your relative freely spends money (on a vacation, for example) before paying you back?

Set the Terms
If you decide to go through with the loan, make sure expectations on both sides are clear. Discuss all terms and conditions and consider putting them in writing. You may even want to draft a formal loan agreement. At the very least, settle on the amount of each loan payment and the date by which the loan must be paid in full. Open-ended obligations often lead to misunderstandings.

On the other hand, don't feel guilty if you decide to turn down your family member's loan request. It's hard to say no, but it's still easier than repairing a damaged relationship if things don't work out.

Have you started setting some money aside in the event of a financial emergency? You never know when the car will need four new tires, the refrigerator will die, or you will need to fly across the country immediately to visit a sick relative. And the way most people are going--living paycheck to paycheck--any financial hiccup could quickly snowball into a major financial crisis. As discussed before, an emergency "rainy day" fund is a critical part of your financial arsenal. In fact, every one of our financially-independent clients fully expect the unexpected, and you should too for one simple reason: You never know when or where a financial emergency will occur.

Second Opinion
You probably think we're overreacting. We're screaming about the sky falling and you just don't have the time to deal with it right now. Trust us; this is a critical component for your financial success, and it should not be ignored. Still don't believe us? The Motley Fool has a great article detailing additional reasons why the emergency fund a critical piece of your financial journey.

"Emergencies or even should-have-been-foreseen expenses will spring a credit card trap on you that can take years to escape from. How Foolish it is to have the money you'll need soon safely accruing interest instead of charging that valve job or honeymoon and paying double-digit interest rates on it for years."

A Little at a Time
You don't have to inherit a $10,000 windfall to sock away cash for a rainy day. Just put aside a few bucks each month, and before you know it, your rainy-day-fund will provide the security and financial peace of mind you need.

Our clients often ask would happen to their assets upon death, incapacity, transfer, or bankruptcy. We usually respond with an "it depends", but at some point the conversation usually evolves into a discussion of trusts. A trust essentially helps you accomplish many estate planning goals. The power of a trust is in its versatility--many types of trusts exist, and each is designed for a specific purpose.

Living Trust
A living trust (also called an inter vivos trust) is a trust you create during your lifetime rather than after your death by the terms of your will (that type is called a testamentary trust). Living trusts are revocable--you keep control over the trust assets, and can change the trust or even dissolve it at any time. This type of trust is useful if you want assets to avoid probate and shield them from public scrutiny, and/or if you want to provide for someone else to manage your assets should you become incapacitated. Living trusts, however, will not minimize taxes or protect assets from creditors.

Irrevocable Trust
An irrevocable trust is one that, once created, you generally can't change or dissolve, and you must give up total control over the trust assets. On the other hand, an irrevocable trust can provide certain tax advantages and asset protection. The following are all irrevocable trusts designed to achieve particular objectives:

Bypass Trust
When a person leaves his or her entire estate to a surviving spouse, assets pass free from federal estate tax because of the marital deduction.

QTIP Trust
A QTIP (qualified terminable interest property) trust (also called a marital deduction trust) is, like the bypass trust, used by spouses to minimize estate taxes. For maximum estate tax savings, a QTIP trust is often paired with a bypass trust. Because the first spouse to die names the ultimate beneficiaries, a QTIP is often used to provide for children of a previous marriage.

Irrevocable Life Insurance Trust (ILIT)
The proceeds of your life insurance policy will be subject to federal estate tax if you own the policy, or your estate receives the proceeds. Often, this asset pushes an estate over the exemption amount.

Charitable Remainder Trust
A charitable remainder trust allows you to give money or property to charity while continuing to receive income (fixed or variable) from the property for life or for a period of time up to 20 years. You and/or other beneficiaries receive distributions from the trust annually, and the charity receives the remaining assets when the trust ends. You get an immediate income tax deduction for the charitable interest (subject to limitations), as well as gift and estate tax deductions. You also avoid capital gains tax on the donated assets.

Trust a Team
If your head is spinning, don't worry. A trust is not a do-it-yourself arrangement. Trusts should be properly structured and carefully drafted to achieve the desired results for your specific situation. Be sure to consult an experienced financial or legal professional to implement the best solution for you.

To gauge how well your stock portfolio is doing, you need to compare it to a benchmark. Familiarity with commonly-used benchmarks (i.e. indexes) can help you make apples-to-apples comparisons.

Standard & Poor's 500 Composite Index
The S&P 500 is a market-value-weighted index of 500 widely held large-cap U.S. common stocks. A committee decides which companies are represented in the index, based on each one's market cap ($4 billion plus), liquidity, and financial viability. It also tries to maintain a representative weighting of industries. Because it represents about 75% of the total market, the S&P 500 is considered a broader representation of the U.S. equity markets than the Dow Jones Industrial Average.

Dow Jones Industrial Average (DJIA)
The DJIA, also called simply the Dow, is a price-weighted average of 30 well-known, actively traded stocks such as AT&T, Boeing, Coca-Cola, Exxon, General Motors, IBM, and McDonald's. Though the Dow is the oldest and best-known stock index, it represents less than 25% of the market value of all stocks on the New York Stock Exchange. In addition to serving as a proxy for the performance of blue-chip industrial stocks, it has given rise to several investing strategies based on Dow stocks.

Nasdaq Composite Index
The Nasdaq index includes all 3,000-plus foreign and domestic stocks traded on the Nasdaq system, an electronic network of securities dealers. The market value-weighted index includes many high-tech companies whose stocks first began trading after the Nasdaq system was launched in 1971.

Wilshire 5000 Equity Index
The Wilshire 5000 includes not only common stocks but also real estate investment trusts (REITs) and master limited partnerships. Because almost all actively traded U.S. securities are included in it, it is considered the broadest U.S. equity index. However, because it is weighted by market capitalization, the Wilshire's largest stocks account for the bulk of its total market cap and greatly affect its performance.

Russell 2000 Index
The Russell 2000 is a market cap-weighted index of approximately 2,000 stocks with market caps of less than $3 billion. It includes the smallest stocks represented in the Russell 3000 Index, another large domestic-stock index, and is often used as a benchmark for small-cap stocks.

MSCI EAFE Index
The EAFE (short for Europe/Australia/Far East), a market cap-weighted index of stocks in non-U.S. countries,focuses on stocks in large industrialized nations. It tends to be less volatile than indexes such as the S&P/IFCI, which focuses on securities in developing countries.

Watch Your Weight
Remember, indexes are generally either price weighted or market cap weighted. With a price weighted index, the highest-priced stocks have the most impact. By contrast, an index based upon market capitalization reflects the relative size of each company. Stocks with a larger market cap have more influence than smaller companies.

More than ever, people are using their computers to prepare tax returns, monitor banking activities, and manage investment portfolios. In fact, many of our clients have completely eliminated the paper trail in their financial lives, preferring instead to receive and archive all financial statements electronically. But are electronic records adequate?

Paper vs. Electronic
Generally, an electronic record has the same worth as a paper record for tax and legal purposes. And the rules for how long you should keep electronic records are the same as for paper records.

But if you decide to go the electronic route, you must take extra steps to make sure your records are safe. This means keeping at least two copies of your electronic records: one copy on your hard drive and another copy on a removable hard drive device, an external data server, or burned onto a CD or DVD. In fact, even if you have paper records, if you own a scanner, you might consider digitizing important records into your computer. If you need help deciding how to organize your documents, your local computer retailer offers software designed to simplify financial record keeping.

Many banks and financial institutions now keep electronic images of your financial records, such as monthly canceled checks or quarterly brokerage statements. If you don't download important items and save them on your own computer, inquire about the institution's policy on how long it will store your records, and how you can access them if you need them. You wouldn't want to lose a tax deduction because your bank didn't keep an electronic image of a canceled check for a sufficient period of time.

How Long Should You Keep Financial Records?

Tax records--We recommend keeping your tax records for up to seven years. This is because the IRS has three years from a tax return's due date to challenge your return, and it has up to six years to challenge your return if you've underreported your income by 25% or more in a given year. The tax records you should keep include statements related to wages, deductions, dividend or interest income, capital gains or losses, and business profits. As for the actual tax returns, it's a good idea to keep copies indefinitely.

Retirement records--You should keep year-end 401(k) account statements at least until you retire, along with any rollover paperwork. Similarly, you should hold on to records that detail your IRA contribution and withdrawal activity--year-end statements should suffice. Also, keep copies of tax forms related to your IRAs until all money is withdrawn from the accounts.

Investment records--When you purchase stocks, mutual funds, and other investments, you need to keep records relating to how much you paid (i.e. "cost basis") so you can document the amount of gain/loss when you sell the asset. You should also keep paperwork showing periodic purchases or the reinvestment of dividends related to the asset, if applicable (again, year-end statements should suffice). When you sell the investment, the records should be kept for up to seven years according to the rules above for tax records.

Home improvement records--If and when you sell your home, you'll need to calculate the costs of any permanent home improvements that you've made for tax purposes. So make sure to keep copies of all work invoices and canceled checks related to your home.

It's All on Your Shoulders
While electronic records can help cut down on the volume of financial paperwork you need to store in your filing cabinet, it's your responsibility to make sure you can access all records--paper and electronic--if and when you need them.