The Basics of Asset Allocation

Michelle Singletary
Thursday, July 30, 2009; 9:48 AM

Live Chat Today

Wondering what to do about your retirement portfolio? Join me today for a chat at Noon ET. I'll be discussing the book "Asset Allocation for Dummies," this month's Color of Money Book Club selection.

During the live online discussion, you'll be able to ask authors Jerry A. Miccolis and Dorianne R. Perrucci questions about diversifying your investment account. Perrucci is a financial journalist and Miccolis is a certified financial planner and co-owner of Brinton Eaton Wealth Advisors in Madison, N.J.

If you can't make the chat, read the transcript later!

Time is Money

Oh, to be young again. For one, I would go back and correct some investing mistakes. When I first started investing in a 401 (k) plan I opted for mostly bonds, which was way too conservative for a young investor. Don't make the mistake I did, advises Kiplinger's Erin Burt.

Although the stock market is still scary (despite its recent upswing), if you've got decades before you retire, don't let the recession chase you away from equities. Read more in If You're Young, Rock the Recession (July 19).

Book Giveaway

As many of you know, every month I give away free copies of the Color of Money Book Club selection. Now, the author of a previous selection wants to give away some additional copies of his book.

In an exclusive offer, subscribers to this e-letter have a chance to win a copy of "Going Broke: Why Americans Can't Hold Onto Their Money" by Stuart Vyse.

I recommended "Going Broke" in March 2008. Read the review and chat transcript from when Vyse joined me online.

If you want a chance to win a free copy of "Going Broke" e-mail me at Put "Going Broke" in the subject line. Please include your full name and address.

For more about Vyse, go to his Web site. If you miss out on getting the free book, you can buy it on Vyse's site.

First-time Homebuyers Conference

The housing crisis has been horrible for many people. But one man's misery is another's opportunity. With housing prices down, it may be a good time for you to buy a home.

All across the country, you can find first-time homebuyer workshops aimed at helping people who still have money and good credit get into their first home.

For example, in the Washington area, Prince George's County Department of Housing and Community Development has programs to assist buyers with funding to purchase properties in the county.

On Sat. August 1, the Neighborhood Stabilization Program will be held from 9 a.m. to 1 p.m. at the First Baptist Church of Glenarden's Ministry Center, 3600 Brightseat Rd. Landover, Md. 20785. For information call 301-773-3600.

At the one-day conference (held at my church, by the way), attendees will get information about first-time homebuyer programs offered by the State of Maryland and the U.S. Department of Housing and Urban Development (HUD). There will be housing counselors from various agencies and lenders available to provide information and home purchase counseling. There also will be information on new housing programs and foreclosure purchases.

If you don't live in the Maryland area, check online for a conference in your area. HUD has more information about local home buying programs.

Sibling Economics

Emmet and Jim Rosenfeld are twin brothers who earn vastly different incomes. Emmet wrote about those differences recently in the Post magazine (Family Finances, July 19). His story prompted the Color of Money Question of the Week: Does your sibling (or siblings) make significantly more or less than you and, if so, how does that play out in the family?

Here is what other siblings wrote about their economic differences:

Carrie Nelson of the District says: "While my younger sister would love to pull big figures, her line of work as a vet technician just doesn't lend itself to that. So she settles for less because she LOVES her work."

Kathleen Culberson of Fairfax, Va., got married, had kids and is now divorced. She returned to the job market after years as a stay at home mom and as a result, took a pay cut. Her sister never married.

"We both went to the same private Ivy League college. She makes three to four times what I do. She borrowed my kids when she felt the occasional need to be domestic; she voluntarily paid for one year of college for each child. I think we are both happy with our choices," wrote Culberson.

"I think it takes real effort for someone to 'overlook' the success of a sibling, especially if that someone is a male," says Ellen Mahoney of Jacksonville, Fla. "My younger brother feels some resentment toward other siblings who have more means and that comes out in pointed remarks he occasionally makes."

Carolyn Cihelka of Woodbridge, Va., wrote: "My mother had warned me that finances were a sore subject with my brother, but I mentioned something to him anyway a couple of years ago and he blew up. He said nobody deserved my good situation more than I did, but he didn't want to hear about it ever again. It makes me uncomfortable that there's this just-below the surface resentment of my situation."

Cassandra Logan of Bowie, Md., says, "I am by no means rich, but one of my siblings seems to like to incorporate me into her and my nephew's future plans. Sometimes I know she is joking but I do think there is this expectation that I will always be available as an emergency fund." Logan's nephew is in college. She sends him money monthly, "But," she says, "I don't ever want to feel obligated."

Does Sex Matter?

Are women better at managing money? In last week's e-letter, I wrote about Katty Kay and Claire Shipman's article Fixing the Economy? It's Women's Work (July 12) that says studies have found that having more women in high-level positions can improve a company's profit margins.

A few of you were skeptical of such findings:

"Be careful of those studies," says Jim Shaffer of Indianapolis, Ind. "Companies with more women on the board than men are generally newer, higher-tech, growing."

Jean Brodeur of Alexandria, Va., says "It could also be true that only the best of the best female performers are able to get to a place in their careers where they're in charge of managing funds!"

"I do not think it matters if the manager is male or female," says Joseph Zairo of Allentown, Penn. "I will stick to good old fashion research when selecting a fund to invest in, I really don't care which restroom the manager uses!"

"Gender is really just one way to measure how diverse a leadership team can be," says Megan Conley Lim of Mountain View, Calif. "It's not that more women on a team are better, but that adding women to an all-male team represents an injection of diverse viewpoints."

Lim adds: "The more minorities or different ages/generations or lifestyles or viewpoints you have on a board, the better the company will do."

Others shared their own experiences:

Jamaican born Brian Campbell of Caldwell, Penn., says, "God bless the women of Jamaica; they are the ones that keep that country afloat financially."

John Warner of Silver Spring, Md., says, "My wife does all the thinking and doing. She likes to, I don't. I'm strictly an indexer. I make occasional suggestions, and she asks me things from time to time, always noncommittal both ways. We share disproportionate agonies and joys as things go up and down and in and out. But after 58 years we are still eatin' reg'lar!"

Charity Brown contributed to this e-letter.

You are welcome to e-mail comments and questions to Please include your name and hometown; your comments may be used in a future column or newsletter unless otherwise requested.

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