for those individuals who do not join a 401(k) plan because they believe they can’t afford it. This allows them to receive some type of tax credit–anywhere from 5% to 10%, depending on their income–from the contributions they have elected to defer to an IRA, up to $2,000. A lot of people forget about this tax credit, and I think it can help. It’s an elective for lower income and single individuals who make under $25,000 and for married individuals or heads of households who make less than $37,500.
B.E.: Is there any tax advice for small businesses owners?
SMITH: For small businesses, the government just increased the capital expenditures rules, like section 179, from $25,000 to $75,000. That’s huge because if you have a vehicle that weighs over 6,000 pounds, you can use section 179 for that. So if you buy a Yukon or an Escalade through your business, you can write the whole thing off as long as it costs less than $75,000. I think that’s a tremendous benefit for small business owners because they can take advantage of it going
Michael Smith ProFocus Inc.
I’m recommending stocks and mutual funds that have had consistent earnings growth over the last two years.
eBay has a terrific business model. It was an online auction company, but it has transformed into a business-to-consumer marketing and distribution network. It’s expanding globally, and its earnings growth is consistent.
Health Management Association manages about 40 hospitals in most of the southern states. It is very cost-conscious, and with its distribution network, it is really driving down the cost of hospital equipment and pharmaceutical services, which has led to consistent earnings growth.
Royce Special Equities Mutual Fund has a great model when it comes to picking small value holdings. It’s one of few fund groups that has had a flat or positive return over the past two to three years. Going forward, it has positioned itself for a market upswing. firstname.lastname@example.org
|Company (Exchange: Ticker)||Price at
EPS Growth Rate
|eBay Inc. (Nasdaq: EBAY)||$75.28||45.4%|
|Health Mgt. Assoc. (NYSE: HMA)||18.34||15.7|
|Mutual Fund (Ticker)||Fund
|Royce Special Equity (RYSEX)||Small-cap Value||18.01%|
|*AS OF JAN. 24, 2003 **AS OF FEB. 7, 2003
SOURCES: MORNINGSTAR INC.; YAHOO! FINANCE; ZACKS INVESTMENT RESEARCH
Cheryl Creuzot Wealth Development Strategies L.P.
My selections are primarily based upon performance vs. style-specific benchmarks, management tenure, and the funds’ buy-sell discipline. I stress the proper asset allocation for investors and suggest the following portfolio breakdown using mutual funds in today’s market. This portfolio is appropriate for the moderately aggressive investor with a 10-year time horizon.
|Mutual Fund (Ticker)||3-Year
|Large Growth||22%||Bramwell Growth (BRGRX)||-14.55%|
|Large Value||25||Ameristock (AMSTX)||0.15|
|Mid Growth||6||Navellier Mid-cap Growth (NPMDX)||-21.80|
|Mid Value||7||Berger Mid-cap Value (BEMVX)||8.81|
|Small Value||10||Ariel (ARGFX)||12.60|
|Foreign Stock||10||American Century International (TWIEX)||-22.89|
|Short-term Fixed Income||13||Strong Government Securities (STVSX)||10.30|
|High-Yield Bond||5||Columbia High-Yield Z (CMHYX)||4.64|
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