Personal finance expert offers practical tips
Friday, May 16, 2008
DAYTON — As an expert on personal finance, Jane Bryant Quinn admits it's much more fun to give a talk when the country is not in a recession.
But despite a lot of depressing news, the financial guru insisted she remains an optimist. ("I am not someone who smells the flowers and looks for the coffin.")
Extras
Bryant addressed a packed house at the Schuster Center on Thursday as the last speaker in the Junior League's Town Hall lecture series.
The presentation was sprinkled with practical advice and jokes, including jabs at the presidential candidates.
"McCain spent years in prison and then went into politics," she said. "Usually it's the other way around."
Known for her best seller "Making the Most of Your Money," Quinn said she is working on a revised edition and is thinking of calling it "Making the Most of What's Left of Your Money."
She chastised the banking industry's "extraordinary irresponsibility," suggesting that banks need more "adult supervision." But Quinn said she feels confident we are not going to see a repeat of the 1930s.
The author said she isn't worried about foreign capital being invested in this country, but is grateful other countries continue to feel we're still a good investment.
"The U.S. is attracting billions in capital," she said, adding that it's the opposite of the situation 40 or 50 years ago when Americans went abroad to buy cars.
"Now they have the strong currency and they will come here and invest."
She also said she doesn't worry about China, a country that's producing far more than they can ever use.
"We're codependent," she said. "They're going to continue to acquire dollars, but they'll spend them here."
On the subject of oil, Quinn said it will take 10 to 20 years to provide substitutes on a large enough scale to run our economy. "It's a huge investment to find alternatives and right now it's simply too expensive."
According to Quinn, California foreclosures are running 2,000 a day. She predicts people will stop talking about homes as an investment in the future.
"In Ohio, you may see modest gains, but you have been hit and got the message earlier than others. Your homes won't make you rich, they may make you happy."
As for personal finance, Quinn advised town Hall patrons to "keep it simple."
"Simple financial products work the best," she said, noting that very few consumers actually have an investment policy that guides how much of their money they will allocate to stocks and to bonds. "Broad diversification is still the best strategy."
Quinn offers this rule of thumb: subtract your age from 110, then put that percentage of your money in stocks, the rest in bonds.
"Bonds have outperformed stocks in the past seven years," she added.
She also cautioned her audience not to sit on their investments and forget them.
"There is a name for people who go in and out of the stock market at exactly the right time," she said, " They are called liars!"
Contact this reporter at (937) 225-2440 or mmoss@DaytonDailyNews.com.
