PortFolio. Tips and trends that affect you and your money
Sign here, please,and write small With all the attention on the new federal rules to make banks clear checks faster, many people missed the fact that bank customers have some responsibility here, too: They have to sign their names properly, or at least in the proper space.
The federal law, which took effect Sept. 1, guaranteeing customers faster access to their deposits also contains some uniform standards for endorsing checks. All endorsements must now be contained within a 1-inch section along the edge of the back of the check so they don't get in the way of endorsements from the bank where the check is deposited.
As for those big rubber stamps stores use to make lines for a clerk to write in your driver's license number, telephone number, credit card number, and any other number they can think of, those stamps are going to have to be more compact, too. The new stamps also have to be confined to the new endorsement area.
The Federal Reserve System says these rules allow banks to comply with the new check-clearing regulations that require checks drawn on local banks to be cleared in three days, out-of-state checks within seven days, and government checks within one day.
Be careful when you redeem EE bonds
Buying United States savings bonds on a regular basis and holding them until maturity is a sound and easy way to save for the future, but it's also important to pay attention to when they are cashed in.
Until they are 1 years old, the interest on EE savings bonds is credited on the first of every month for the previous month. So if you cash in a bond on Sept. 30, you'll lose out on all of September's interest. Do it the next day, Oct. 1, and you get the extra month's interest.
After the first 18 months, the interest on EE bonds is calculated every six months. The same strategy applies here, as well. If the bond was bought in February, the interest will be added up on Aug. 1. But if you cash it in at the end of July, you'll lose the whole six month's interest.
Also, if you buy the bond on the last day of the month, the interest will be credited as if you had bought it at the beginning of that period.
Sizing up mutual funds on a PC
People who have personal computers and read Forbes magazine for its annual survey of mutual funds can now combine them. The magazine has a ``Mutual Fund Evaluator,'' a computer program that screens and generates reports on the performance of more than 800 equity funds.
The evaluator is a floppy diskette designed to run on the IBM PC and compatibles and lets an investor look for funds that meet any of 35 investment criteria.
People can find funds that had the best performance over various time periods, ranging from three months to 10 years, as well as those that meet the investor's standards for risk, yields, assets, net asset value, loads, and volatility. It will also assign the magazine's letter grades for performance in up and down markets, ranging from A to F.
Information on how to get the program is contained in the magazine's Sept. 12 issue. Sorry to rush the season, but ...
Mid-September may seem a bit early to start thinking about Christmas shopping, but some people like to get an early start. They avoid the rush and find more things to choose from.
Although the idea of shopping early isn't new, more people are making lists well ahead of time, thinking carefully about several options that Aunt Tillie might like, how much they want to spend on everyone, and keeping the list handy when they go shopping. Gifts can turn up in unexpected places. Having the list close at hand also cuts down on impulse buying and overspending, and helps you come up with more satisfying gifts than those bought in the last hours.
An early and well-planned start will also help keep spending - especially credit card spending - manageable and help you pay off total balances each month and avoid finance charges, which are still over 19 percent at many banks and as high as 22 percent at some.
Title insurance offers more shelter
For many first-time home buyers, the first time they are told about title insurance, they may think it's just one more expense. But title insurance can be valuable.
For a few hundred dollars paid at the time of sale, the title-insurance company does a complete investigation of the title to the property, to make sure the people who are selling the house have clear title to it, and that the people they bought the house from also had clear title.
By looking through public records, private files, and documents of previous transactions, title search companies can make sure there are no claims, liens, rights, or encumbrances are attached to the property that could void the sale or that the new owner would have to pay for.
Once a title-insurance policy is issued, the homeowner's rights are protected against any previously-unknown claims that may come up. If a claim is made against a standing title policy, the title-insurance company will pay any legal claims which the homeowner must pay to defend his rights. Also, most title-insurance companies will pay any covered loss which comes out of a valid claim. This protection covers the property as long as the purchaser or the heirs own the home.
A mutual fund of bank loans - really
Banks haven't had it very good this year. Both federal agencies that supervise banks and savings-and-loans, the Federal Deposit Insurance Corporation and the Federal Savings and Loan Insurance Corporation, have been busy arranging multi-billion-dollar sales, transfers, and other bailouts of banks and thrifts around the country in 1988.
So a mutual fund that is made up of a portfolio of commercial bank loans may not seem to be an example of the best timing. But the Pilgrim Prime Rate Trust could prove to be a useful investment for consumers, pension funds, and partnerships that want stability of principal and higher yields than are available on certificates of deposit.
The fund will buy collateralized commercial loans from domestic corporations that are written by money-center and regional banks.
The fund, being offered by the Pilgrim Group Inc. of Los Angeles since May 11, also gives bankers a chance to see if a mutual fund is a good way to sell packages of commercial loans to the public. At present, these loan packages are generally sold in multi-million-dollar units to institutional investors.
The minimum investment is somewhat higher than the average consumer-oriented fund: $5,000 in most cases, but $2,000 for individual retirement accounts.
The fund is closed-end, which means it will have a fixed number of shares that are traded on securities markets.