in technology-laden mutual funds and 50% in large-cap funds. “I have been looking at the pharmaceutical industry, fiber optics communications, and real cutting-edge technology companies,” she says.
By no means a slacker, Helenese has worked part-time in retail stores since high school. “I wish someone had told me back then that you should take money out of every paycheck-at least $10-and save it.” With more than 30 years until retirement, she has time on her side to establish wealth goals to help reach a hassle-free retirement.
May Winners: Phillip and Jamie Lomax
Phillip and Jamie Lomax didn’t waste any time implementing DOFE principle No. 5: to engage in sound budget, credit and tax management. Since winning the contest, the couple has been sticking to a realistic budget. For starters, they have curtailed such money wasters as dining out and entertainment.
Following the advice of Mark Mitchell, a financial advisor with AXA Advisors L.L.C., in San Juan Capistrano, California, Phillip is no longer solely responsible for the family’s finances. “We felt like the less hands in the mix, the better. Now that [Jamie] has taken an active role, we can see an improvement, especially with creating and following our budget,” says Phillip, who sees his wife on weekends. (He is stationed at Point Mugu in Oxnard, California; she resides at their home in San Diego along with their 8-year-old daughter, Chyanne, and 5-year-old son, Trey.)
“Because [my wife] is more aware of how much money is in our bank account and how much is contributed to our investments, this has made her more aware of how much we are able to spend, [and in turn], how much we are able to save.”
The young couple-he’s 30 and she’s 29-invested half their $2,000 prize, placing $500 in their mutual fund account. They used another $500 to purchase about eight more shares of Home Depot (NYSE: HD), which they had previously purchased through a Dividend Reinvestment Program (DRIP). The remaining $1,000 went toward eliminating their credit card debt-now at a zero balance.
Since the initial consultation with Mitchell, Jamie, a project support analyst for Sempra Energy Information Services (a unit of utility firm Sempra Energy), has contributed 15% of her $32,000 gross salary.
A petty officer first class and aviation electronics technician in the U.S. Navy, Phillip has a defined benefit retirement plan that will pay him 50% of his base pay after 20 years of service in the armed forces. He now plans to open a Roth IRA. “The financial planner pointed out that the advantage of an IRA is to [supplement] my retirement income from the military and to protect [that supplemental] money from taxes while gaining interest and providing a more stable return,” he adds.
Phillip continues to contribute $50 a month to the Millennium Investment Club, a group he formed with 10 other active duty members of the military, and two civilians. The club’s portfolio is currently valued at $7,000. Their holdings include: Philip Morris Cos. (NYSE: MO), Nokia Corp. (NYSE: NOK), Cott Industries (Nasdaq: COTT), and