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Reverse mortgages could be big

Johnny Carson was being interviewed on a park bench a few years ago, and when he saw a pigeon strutting around his feet he looked down at it and said, "Any messages for me?" About now, he should be receiving one from Ed McMahon asking for a little help with Ed's $600,000 home mortgage currently in default. After listening to Ed and his wife on Larry King Live, I found myself asking, "what ever happened to reverse mortgages?"

Optimism risky with 'target distribution'

I've worried about things all my life and nothing really bad has ever happened, so it must be a system that works.

The financial service industry's latest sop to us "worry warts" is the concept of "target distribution" or "managed payout" funds. These are mutual funds that automatically pay out earnings and principal to retirees at a scheduled rate (chosen by the retiree but "monitored" by the fund) and that try to make the money last as long as possible.

Health care on corporate agenda

The Securities and Exchange Commission just decided to let corporate shareholders vote on proposals to have their corporations endorse national health care. To be more specific, the vote will encourage public companies to adopt a stand in favor of "principles for comprehensive health-care reform" — reform that would make health care "affordable to individuals and families, and affordable and sustainable for society." Who can argue with that?

Dividends scratch itchy investors

Remember the "Seven Year Itch?" It was a movie starring Marilyn Monroe, but the term applied to the statistic illustrating that marriages tended to fail most often at that seven-year mark.

Back in the 1970's, when today's Baby Boomers were struggling with relationships rather than their retirement planning, I recall hearing that some motels in Walnut Creek were experiencing 110 percent occupancy ratings.

New 401(k) law great for investors

Sometimes it takes an act of Congress to straighten out a few kinks in the financial services sector. I was leafing through the final version of Congressman George Miller's bill calling for disclosure of all 401(k) fees and was amazed at how comprehensive the end result appears to be. If this bill had been in place over the last 20 years, the average 401(k) participant would probably have about 20 percent more money today.

Sixteen of the nation's largest companies would have been spared the embarrassment of being sued for having charged excessive hidden fees.

Downsizing life's rich expectations

Lets assume, for a moment, that we are headed into a period of time when we may all have to be a little less self-indulgent. Higher taxes and incomes that fail to keep up with inflation could contribute to what former governor Jerry Brown used to say was a need to "lower our expectations." That might not be such a bad thing.

At least some self-indulgence is rooted in a need to stay even with our perceived peers rather than how much we spend in an absolute material sense.

Ayn Rand and Alan Greenspan

Some prankster must have pasted a Post-it note saying "kick me" on the back of Alan Greenspan's shirt. He seems to be getting the blame for the sub-prime mess because he failed to consider that unbridled capitalism has a tendency to eat its seed corn periodically.

His autobiography, "Alan Greenspan — the Age of Turbulence" starts out by discussing his early days spent in the New York salon of Ayn Rand, the novelist and philosopher who wrote "Atlas Shrugged" and "The Fountainhead."

Correction: House beats stock market

Last week's column compared the performance of residential real estate with a comparable investment in the Dow Jones industrial average. My e-mail was just sizzling on Monday morning thanks to several readers who pointed out that my math had failed to take leverage into consideration.

"Look at ROI (Return on Investment)" screamed the readers. Their comments reminded me of the current candidate for mayor of London of whom a commentator said, "Apart from being a philanderer, he's a great family man."

Social security as an investment

The farmer who was asked why his pig had a prosthetic leg said, "Because we're saving the rest of him to eat later." In a similar vein, here's a new slant on deciding when to belly up to that Social Security feeding trough.

Most people who are still working tend to postpone the start date until at least 66 and some will decide to wait until age 70. Waiting until 70 generates 135 percent of whatever the age 66 benefit schedule might have been which is tempting. But we could all die earlier than we expected --- and get nothing.

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