Minimizing Taxes On Funds

Today’s article will enable you to understand how to select tax-friendly mutual fundscomposite triple beat when investing outside of retirement accounts. The key is to use tax-free money market and bond funds. Certain kinds of money market and bond funds invest only in bonds issued by governments, and depending on the type of government entity they invest in, their dividends may not be subject to state and/or federal tax. Such funds are typically identified by the word “Treasury” or “municipal” in their fund titles.

A Treasury fund buys federal government-issued Treasury bonds (also called Treasuries), and its dividends (although federally taxable) are free of state taxes. The dividends of a municipal bond fund, which invests in local and state government bonds, are free of federal tax, and if the fund’s investments are limited to one state and you live in that state, the dividends are free of state taxes as well.

The catch: Because everybody knows that Treasuries спални and municipal bonds are not subject to complete taxation, the governments issuing these bonds can pay a lower rate of interest than, say, comparable corporate bonds (the dividends on which are fully taxable to bondholders). Therefore, before taxes are taken into account, tax-free bond and money market funds yield less than their taxable equivalents. However, after taxes are taken into account, you may find that with tax-free money market or bond funds, you come out ahead of comparable taxable funds if your tax bracket is high enough. Because of the difference in taxes, the earnings from tax-free investments can end up being greater than what you’re left with from comparable taxable investments.

If you’re in the 28 percent federal bracket or higher, don’t buy tax-free funds Inside retirement accounts. Your returns inside a retirement account are already sheltered from taxation. You can ignore the taxability of funds and go for the highest yields.

Unfortunately, stock mutual funds don’t have a tax-free version like bond and money market funds do. Unless they’re held inside a retirement account, stock fund distributions are always taxable, period. If you’re in a high enough tax bracket and a stock fund makes large distributions, these stock distributions can be a significant tax burden. Unfortunately, with stock funds more than any other type of fund, investors often focus exclusively on the pre-tax historical return, ignoring the tax implications of their fund picks.

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Stress & Tension

Tension is a form of stress that everyone experiences each day through hundreds of different outlets. There is a conscious or unconscious concern about our ability to perform that lies at the basis of this very common stress: Feelings of tension.

We sometimes speak of nervous tension, tense situations, or of tensions between people, but tension only exists in the muscles. It is a physical reaction, a contracting of the muscles, which occurs in all of us when we are threatened. In one respect this tension is good. It prepares us for emergencies and keeps us alert.

When the tension persists, however, we become restless, fidgety, and unable to concentrate. We might bite our nails or show other nervous mannerisms, and very often there are such physical reactions such as backaches, chest pains, stiff necks, or headaches. One recent report has suggested that roughly half of all headaches come from a muscle tension which results from the pressures of daily living.

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Deepak Chopra

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How To Organize Your Child’s Room To Make It More “Kid-Friendly”

While you are sitting on the floor, look for ways the room could be arranged to make it easier for a little person to manage. What about the bed? Are the sheets, blankets, and bedspread the ones adults think cute or pretty but that are hard for a child to make up neatly? Perhaps a bedspread with cording or a design marking the side edges of the bed is better.

Some children have a washable quilt that can easily be pulled up rather than having a top sheet and bedspread with it. The child can make it by just crawling up to the head of the bed, pulling up the cover, smoothing it, and slithering out.

As you are looking for ways to make the room arrangement easier, ask yourself if the child can hang up his own coat and robe. If not, maybe hooks would be easier than hangers.

You will probably want a wastebasket and some kind of clothes hamper in the room. Shoe boxes in the drawers make terrific dividers to separate socks, underwear, belts, and pajamas. As you sit on the floor evaluating, you will come up with some good ideas, but don’t forget to ask for the child’s opinion, too.

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