How to choose the right mix of investments
Whether you already invest or are just starting out, you may wonder how to find the right choices from so many possibilities. Start by considering your goals, risk tolerance and time horizon. Knowing what you want to achieve makes it easier to find the right mix—or asset allocation—to help you get there.
- To be eligible for favorable tax treatment afforded to any earnings portion of withdrawals from Section 529 accounts, such withdrawals must be used for “qualified higher education expenses,” as defined in the Internal Revenue Code. Any earnings withdrawn that are not used for such expenses are subject to federal income tax and may be subject to a 10% additional federal tax as well as state and local income taxes.
For a current prospectus of money market or mutual funds, be sure to request a prospectus and/or a summary prospectus from your broker or from the fund company and read it carefully. Before investing, carefully consider the investment objectives, risks, and charges and expenses of the fund. This and other information may be found in the fund’s prospectus and/or, if available, summary prospectus. Read the prospectus carefully before investing. Investments in the funds are not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although money market funds seek to preserve the value of your investment at $1 per share, it is possible to lose money by investing in the funds.
Investing involves risk including loss of principal.
This material does not take into account your particular investment objectives, financial situations or needs and is not intended as a recommendation, offer or solicitation for the purchase or sale of any security, financial instrument or strategy.
Before acting on any information in this material, you should consider whether it is suitable for your particular circumstances and, if necessary, seek professional advice. Any opinions expressed herein are given in good faith, are subject to change without notice, and are only correct as of the stated date of their issue.
Asset allocation, diversification and rebalancing do not ensure a profit or protect against loss in declining markets.
Certain stocks can pose systematic market risk, including possible illiquidity and greater volatility than others. Some stocks move independently of the market as a whole where risks can potentially be minimized through diversification. Dividends may not be guaranteed.
Investing in fixed-income securities may involve certain risks, including the credit quality of individual issuers, possible prepayments, market or economic developments and yields and share price fluctuations due to changes in interest rates. When interest rates go up, bond prices typically drop, and vice versa.
Income from investing in municipal bonds is generally exempt from Federal and state taxes for residents of the issuing state. While the interest income is tax-exempt, any capital gains distributed are taxable to the investor. Income for some investors may be subject to the Federal Alternative Minimum Tax (AMT). Investments in high-yield bonds (sometimes referred to as “junk bonds”) offer the potential for high current income and attractive total return, but involves certain risks.
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