You need to act fast for HH bonds, CollegeIllinois
BY TERRY SAVAGE SUN-TIMES COLUMNIST Jul 14, 2006
Updated: May 3, 2013 12:14PM
Originally published: July 29, 2004
Sometimes items come across my desk that aren’t quite important enough for a whole column, but they are worth mentioning.
**End of Series HH Savings Bonds. As of the close of business Aug. 31, the U.S. Treasury will cease issuing Series HH Savings Bonds. They’ve been used by owners of maturing Series E and EE bonds to postpone gains. Series HH bonds pay monthly interest, currently at an annual rate of 1.5 percent. Investors who already own HH bonds will continue to earn interest until the bonds reach final maturity 20 years after the date of purchase.
You can still purchase Series EE bonds, currently paying 2.84 percent, and Series I bonds (inflation-adjusted savings bonds) with a current rate of 3.39 percent. The easiest way to purchase U.S. Savings Bonds is online at www.treasurydirect.gov.
**CEO pay soars. When your boss says there’s no money for raises, you might want to point to the latest survey of CEO pay at www.TheCorporateLibrary.com. Total compensation for CEOs in the S&P 500 rose by a median 22.19 percent in 2003, double the increase this group had the year before. Many CEOs earned more than the median, mostly as a result of exercising previously granted options or by current awards of restricted stock. In fact there were total compensation increases of more than 1,000 percent for the CEOs of Oracle, Apple Computer, Colgate-Palmolive and Yahoo!
* CollegeIllinois deadline looms. Monday is the deadline for parents and grandparents to enroll newborns into CollegeIllinois, the state’s prepaid tuition plan. Costs of the units are certain to rise in October, when this year’s contract prices are revealed. But if you purchase a unit now, you can lock in this year’s low prices, and keep adding to it with new contributions in coming years. Hurry to www.CollegeIllinois.com.
* Long-term care deal. Buying long-term care insurance is a must, but many carriers are deciding to get out of the business as they realize they’ve miscalculated the risks that the boomer generation will hang on to these policies and actually use them one day. But for at least the next few months you can buy one of the last great deals if you or your company can afford it.
MAGA Limited, established in 1975, a family-owned and -operated insurance agency that focuses exclusively on long-term care insurance, is still selling lifetime coverage through a 10-year paid up policy where you can lock in a guaranteed premium, pay it for the next 10 years, and never worry about future price increases. The cost is steep: about $12,000 to $15,000 per year for a 60-year-old. But if your company pays the premium, it’s tax-deductible to the business, and not income to the employee, who ultimately receives the benefits tax-free if the need for long-term custodial care should arise. For information call MAGA at (800) 533-6242 or go to www. MAGALTC.com. Also worth checking out: TransAmerica’s plan at (800) 690-2758.
* Late summer reading. For children, there’s Stock Market Pie ... Grandma Helps Emily Make a Million! by J.M. Seymour (available at www. dynamindspublishing.com). It’s a kid’s book, meant for 9- and 10-year- olds, but would be interesting for high-schoolers and their parents. It defines everything from stock splits to bulls and bears, and is beautifully illustrated.
For widows, there’s an excellent book by Nancy Dunnan, The Widow’s Financial Survival Guide (Perigee-Penguin, $14.95). This would be a really useful gift for a woman who recently lost her spouse. It covers everything from finding new health insurance to dealing with Social Security benefits and making a new estate plan.
For couples, pick up The Family CFO by Mary Claire Allvine and Christine Larson (Rodale, $23.95). Allvine is a partner in the Chicago office of Bownson, Rehmus, and Foxworth, which quietly serves the ultra-rich and sophisticated. She carefully explains why money is the No. 1 cause of tension among couples, and offers helpful solutions. Make this a wedding shower gift!
For old times’ sake, and because there’s still something to learn from someone who’s been through the best and worst of times, browse through Howard Ruff’s latest book, Safely Prosperous or Really Rich (Wiley, $24.95). You don’t have to choose between the two options in the title. Most of us would settle for either! His tips are simple but worth repeating -- and Ruff is still bullish on gold!
And if you still have time left over while things are slow this summer, think back to the promises you made yourself in January. Have you updated your estate plan to create a living trust? Or analyzed your 401(k) investments at www.FinancialEngines.com to make sure you’ll reach your goals? Or started banking online? There’s no better time than August! And that’s The Savage Truth.
Terry Savage is a registered investment adviser, and appears weekly on WMAQ-Channel 5’s 4:30 p.m. newscast. Distributed by Creators Syndicate.