California Coast Credit Union

Thinking about establishing a retirement account but not sure where to begin? The easy part of retirement planning is talking about the places we want to travel to – the hard part is figuring out how much to put away.

Here are some simple questions you can ask yourself to get the basics of a retirement plan going. Answering these questions can get your mind into thinking about what your retirement plan may entail.

When do you want to retire?
This tells you a number of things -- how many years you can keep socking away savings in retirement plans and elsewhere, whether you are going to have a number of years with no paycheck and no Social Security, whether you are going to get hit with tax penalties if you take too much money out of your retirement plan before age 59 1/2.

How much money will you need?
Look at your current expenses, and then estimate how they might change at retirement and with inflation. And do yourself a favor: Forget that rule of thumb that you only have 70% to 80% of your pre-retirement expenses. Most of my retired clients find they spend the savings they’d expected from not having to commute or dress for success on things they’re much more interested in, such as travel and education. They also have to deal with rising medical expenses. And, of course, inflation. Never forget inflation.

How long will you need the money?
This, of course, is directly related to how long you live, and the actuarial odds are stunning. If you retire at 65, plan on living another 25 years -- just to be safe. That's a long time for a retirement nest egg to last, especially if part of it, such as a fixed pension or annuity, isn't going to increase with inflation.

How can you increase your savings?
The best way is to track your expenses for three months, and then cut the fat out and generate a realistic budget. That daily, $3 frozen cappuccino doesn't taste as good when you realize you’ll be sitting on a park bench feeding bread crumbs to the birds for entertainment if you don't start saving a whole lot more right now. It's a little deprivation now, versus a lot of deprivation later. It goes without saying that you need to put every dollar you can into tax-deferred retirement plans, whether you think you can afford to or not. If you have less in your paycheck, you will spend less.

This may come as a shock: The amount you can spend in retirement each year, without running out of money, is far less than most people think -- no more than 3% to 4% of your savings a year. -By Liz Pulliam Weston

It's no secret that most Americans aren't saving enough for retirement. What's less discussed is the yawning chasm between what most workers think they'll need and the amount of money actually needed to produce an income that will last 30 or more years.

Consider these findings from a recent retirement confidence survey by the Employee Benefit Research Institute:

84% of workers say they're confident they'll have enough money to cover basic expenses in retirement, and 75% believe they'll be able to manage their money well enough not to outlive their funds. But less than one-third of those surveyed had actually tried to calculate how much they'll need. Only 26% of younger workers and 33% of those aged 40-59 had tried to do the math. Only 23% of those aged 40 to 59, and 17% of those over 60, said they have saved $100,000 or more for retirement, while 13% of those aged 40 to 59, and 11% of those over 60, say they have saved nothing at all for retirement. The crux of the problem is that the amount of money you can spend each year without running out of money is far less than most people think: no more than 3% to 4% a year.

Financial planners call this the "sustainable rate of withdrawal." And what it means to you and me is that we'll need a nest egg of at least $1 million to get just $40,000 in annual income.

Before you despair and cash out your retirement funds, however, it's important to know that these calculations assume you want to be nearly 100% certain of having enough money to last your lifetime. It's possible to take a higher percentage of income and still not run out, but you'll need to either 1) die quickly or 2) be a little bit lucky with your investments.

The table below shows the maximum withdrawal rate over various time periods and confidence levels.

Retirement withdrawal rates
Payout Period	10 Yrs	20 Yrs	30 Yrs	40 Yrs
100% Safe	8.84%	5.16%	4.26%	4.08%
98% Safe	9.00%	5.32%	4.40%	4.12%
95% Safe	9.27%	5.51%	4.52%	4.25%
90% Safe	9.78%	5.70%	4.71%	4.56%

Source: Retire Early

While they provide an interesting illustration, the numbers in the table are way too precise. The more you know about retirement income calculations, the more you'll realize how fraught with uncertainty the whole field is.

Until the mid-1990s, calculating sustainable withdrawal rates was pretty much a guessing game. Many planners simply picked a figure somewhere below the expected rate of return on a portfolio. If the planner figured the client would earn an 11% average annual return -- about the norm for a stock portfolio -- he would subtract a 3% or so inflation rate and allow an 8% annual withdrawal rate, or perhaps slightly less if he were a conservative type.

That seemed a little too off-the-cuff for Bill Bengen, a financial planner in El Cajon, Calif. Bengen knew that there was no such thing as an "average" market, and suspected that withdrawal rates that seemed reasonable when based on averages would turn out to be too high when faced with real market conditions.

Bengen's research, using model portfolios and subjecting them to historic market conditions, proved his suspicions to be correct.

Depending on the portfolio's mix of stocks and bonds, Bengen found that even a 5% withdrawal rate -- adjusted each subsequent year for the inflation rate -- could cause someone to run out of money in 20 years. A 3% withdrawal rate from a balanced portfolio almost never did. His influential findings were published in a four-part series for the Journal of Financial Planning starting in 1994 (see link at left under 'Related Sites').

(Bengen also found that having a portfolio that was too heavily weighted in bonds was worse than one that went overboard with stocks. Bengen helped reinforce the idea that even risk-averse retirees should have at least 50% of their money in stocks in order to get enough long-term growth to overcome inflation and other portfolio-killers.)

Mutual fund giant T. Rowe Price later added to our understanding of sustainable withdrawal rates. As my colleague Terry Savage wrote in "Make sure your income outlives you," T. Rowe demonstrated that too-high withdrawal rates early in retirement -- especially in bad markets -- could cause a retiree to run out of money decades too soon.

Assuming consistent returns wasn't the only blunder planners made. More financial advisers now realize that spending patterns in retirement may not be constant, either. Instead of needing a steady income throughout, income needs might spike, decline or take a U-shape.

For example, many retirees might need more money in the early years as they travel, indulge expensive hobbies or share their largesse with their children. At least half continue to save money in the early years, as well.

In the middle years, retirees may need less income as their wanderlust is sated and their health declines somewhat, leaving them less interested in leaving home. Spending might soar again in the last years, thanks to long-term care needs.

Then, of course, there are all the uncertainties of life expectancy. Once many planners figured their clients would die by age 85. Today, planning until age 95 or 100 -- or even later -- is becoming more common. Of course, the longer you live and spend in retirement, the more money you'll need.

Finally, there's the issue of expected returns. Obviously, no one can predict what the Dow will do next, and our historical context for guessing is pretty short -- the modern market is less than 100 years old, after all.

With all the unknowns, there's simply no way to say definitely how much you'll need to save or how long that money will last you. That doesn't mean you're helpless, however: Don't fail to plan. You can -- and should -- use retirement calculators like those included in Quicken or Money to give you a rough idea of how much you may need. People who have a plan for investing, and who stick to it, will be better off than those who leave their retirements to fate. Don't underestimate the importance of guaranteed income. Pensions and Social Security can reduce, perhaps significantly, how much you may need to save. Although traditional pensions are getting rarer and Social Security benefits may get trimmed, these sources will still exist for many workers. Others may be able to guarantee an income stream by using some of their retirement funds to buy an immediate annuity. Don't despair. I've previously mentioned Ralph Warner's excellent Nolo Press book, "Get a Life: You don't need $1 million to retire well." Even if you can't save enough, you can help ensure a happy retirement by tending your health, your family, your relationships and your hobbies. Warner's research shows these factors are at least as important as money in determining how content you'll be in retirement.

San Diego ranks 11th nationally when it comes to identity theft complaints, according to the Federal Trade Commission, and thieves are getting more creative in using new methods to get your information and coming up with ways to use it. The information can be used to make counterfeit checks, get loans in your name or even take over your existing accounts.

You need to be aware of the potential for identity theft as an issue as you go about your daily activities. You can help guard against it by being cautious and proactive.

Don't give out personal information on the phone, through the mail, by answering emails or going to linked websites from emails, or in other ways over the Internet unless you've initiated the contact and you are very sure you know who you're dealing with. Be wary of promotional offers. Identity thieves may use phony offers to get you to give them your personal information. The recent glut of scam emails has made this a risk everyone should be aware of.

Guard your outgoing mail from theft. Never put outgoing mail in your home mailbox. Put it in post office collection boxes or, even better, drop it at your local post office, rather than using an unsecured mailbox. Consider what bills you are currently paying with checks that you could pay electronically. It’s easier and more secure.

Guard your incoming mail, too. Promptly remove mail from your mailbox. Pay attention to your billing cycles, and follow up with creditors if your bills don't arrive on time.

Be sure to shred old checks and bank statements, expired charge cards that you're discarding, and credit offers you get in the mail—anything with information about you, your family, your house or your finances.

Carry only the identification and credit and debit cards that you'll actually need. Don't carry your SSN card at all; leave it in a secure place. Give your SSN only when absolutely necessary. Ask to use other types of identifiers, such as passwords you have selected, whenever possible.

Secure the personal information that you keep at home, especially if you have roommates, employ outside help or are having service work done in your home. Invest in a locking cabinet.

Keep your purse or wallet in a safe place at work as well as any copies you may keep of administrative forms like paystubs or benefits information that contain your sensitive personal information.

Finally, never leave personal information in your car. Don’t leave your purse or wallet, or a stack of mail, or even car repair receipts.

The best identity theft information you can get is probably what appears on the Federal Trade Commission’s website, www.ftc.gov. A brochure called “When Bad Things Happen to Your Good Name” that can be downloaded there is a great starting point. That and other resources at that website provide the steps to follow, forms you can use, and contact information you will need. For example, the contact information for the major credit bureaus.

–If you do have identity theft, you’ll want to immediately report the situation to the fraud units of the three major credit reporting companies—
--Experian (formerly TRW),
--Equifax and
--TransUnion.

If you are an identity theft victim, there is new legislation that entitles you to a free credit report so you can see if fraudulent activity in addition to what you are aware of appears on your reports. You can also place an identity theft alert on your credit report with those bureaus.

The web site of the California Office of Privacy Protection also provides information on how to establish a security freeze, www.privacy.ca.gov/financial/cfreeze.htm.

Stolen checks- If you have had checks stolen or bank accounts compromised, contact your financial institution to report it immediately Put stop payments on any outstanding checks that you are not sure you wrote. Cancel the compromised checking and savings accounts and have the financial institution set up new account numbers.

ATM and other cards- If your ATM, debit card, or credit card has been stolen or compromised, contact your financial institution and report it immediately.

–Fraudulent New Accounts-Contact all creditors immediately with whom your name has been used fraudulently, both by phone and in writing.

Debt collectors - If debt collectors attempt to require you to pay the unpaid bills on fraudulent credit accounts, ask for the name of the company, the name of the person contacting you, phone number, and address. Tell the collector that you are a victim of fraud and are not responsible for the account and keep records of those contacts.

Law enforcement - Report the crime to your local police or sheriff's department. You might also need to report it to police departments where the crime occurred.

Fraudulent change of address. Notify the local Postal Inspector if you suspect an identity thief has filed a change of your address with the post office or has used the mail to commit fraud.

With gas prices on the rise, many consumers are feeling the pinch each time they reach for the pump. It is estimated that more than 50% of Americans will be forced to make sacrifices by cutting back on other spending to keep up with rising prices at the pump.

There are several measures you can take to conserve fuel and improve the fuel efficiency of your vehicle. Normal maintenance and paying attention to your driving style can help improve fuel efficiency as much as 30 percent. Here are more ways to stretch your gas dollars and ease the pain at the pump.

Women who manage the family checkbook are now checking their mutual funds and IRAs. According to a recent survey, 95% of women were solely or jointly involved in IRA decisions. Five years ago, it was only 61%.

Whether single, married, divorced or widowed, women are making more major financial decisions than ever before--and Wall Street is paying attention. Wall Street firms are researching who these investors are, and how they want to invest. One of the most interesting findings is that women and men have different investment styles.

To help all investors, California Coast Credit Union offers free financial workshops. For upcoming dates and locations, click here.

Face your future.
Take a hard look at finances and start making adjustments as soon as a change appears possible; even if it’s years ahead. Ask your benefits department to identify any vacation, sick leave and severance pay you have coming. Take full advantage of your flexible spending account. Investigate converting your employer’s group life insurance to an individual policy. Consider continuing your group health insurance under Cobra, the federal law that entitles you to keep coverage for up to 18 months. Be strategic with your retirement accounts.

Analyze the budget.
Identify all your assets, including potential resources that you can tap into, such as the equity in your house, cash-value life insurance and a retirement fund. Consider refinancing your house to lower your monthly payments or taking out a home equity line of credit for emergencies. Scale back expenses before you move to one income.

Expect surprises.
Even if you plan, life can bring surprises: a layoff, a baby, car repairs. Make sure you have a backup plan. And evaluate which spouse would be happier at home.

Seize opportunities.
Two-salary couples whose expenses have risen to match their earning power don’t have the luxury of letting go of one salary. Maybe the person at home now has time to go back to school part-time or study for a license or certification. The new training may result in a new part-time or full-time career.

Stay focused.
All changes bring challenges, but stay focused on the reason why you made the changes in the first place. Go over every single bill to see where you’re money is actually going—not just what your budget says. Can you get a cheaper cell phone plan, or save money at the grocery store? Remember that you made the changes so that the entire family would benefit.

1: Follow the market
Index funds are the oldest and the broadest category of simple investments. Basically unmanaged baskets of securities, index funds are meant to track a market benchmark . Standard & Poor's 500 Index ( $INX ), a yardstick of large-company performance, or the Russell 2000 ( $RUT.X ), a small-company index. With an index fund, you should do as well as the benchmark over time (minus the expenses of running the fund).

And that can turn out to be a top-notch return. The granddaddy of all index funds, the Vanguard 500 Index ( VFINX ), boasts a record that puts it in the top 20% of all diversified U.S. stock funds over the past 20 years. During that period, it returned an annualized 13% (to Aug. 2), nearly two percentage points per year ahead of its rivals. Over the past five years, however, the fund failed to keep pace, losing 2% per year compounded, while diversified U.S. stock funds gained 1% annually, on average. Vanguard 500 lagged mainly because most funds own a greater proportion of small-company stocks, and the little guys have outpaced big-company stocks the past few years.

Compared with their actively managed peers, the main advantage of index funds is low fees. Compare the 0.18% of assets you'll pay for Vanguard 500 to the 1.5% average for actively managed, diversified U.S. stock funds. And because index funds generally trade stocks only when the index changes, trading costs are kept to a minimum.

Which index to choose? The answer depends largely on the degree of simplicity you crave. You could put the stock portion of your portfolio into Vanguard's Total Stock Market Index ( VTSMX ) and, voilà, you're done. The fund, which charges just 0.2% a year in fees, mirrors the Wilshire 5000 index, a proxy for the entire U.S. stock market. "Total Market's a no-brainer. Once you get into small, large, growth or value, you're making judgments -- why do it?"

Or, you could round out your holdings with a bond fund, such as Vanguard Intermediate-Term Tax-Exempt ( VWITX ), or with a fund that invests in other bond funds (more on the latter later).

Without complicating matters too much, you could even diversify a little more. Since Total Market is tilted toward large companies, you can give the small fry their due by dividing your stock assets 50-50 between Vanguard 500 and Vanguard Small-Cap Index ( NAESX ), which tracks a Morgan Stanley gauge of 1,750 small companies. If you're set on a still broader mix, place 10% to 20% of your stock investments in a wide-ranging overseas index fund, such as Vanguard Total International ( VGTSX ), which gives you the world for annual expenses of just 0.36%.

Vanguard's index funds tend to be the cheapest, and they track their indexes closely. But other companies' no-load offerings are fine, too. Consider Schwab's 1000 Index ( SNXFX ), which tracks 1,000 large companies, and Fidelity's Spartan index line, which includes International Index ( FSIIX ) and Extended Market ( FSEMX ) for small and midsize firms. Just don't pay more than 0.5% to buy in to an unmanaged basket of stocks.

2: Index with flexibility
Exchange-traded funds are an option for investors who crave flexibility along with simplicity. ETFs are index funds that trade like stocks. You buy them from a broker, but unlike mutual funds, which are priced just once daily, ETFs trade throughout the day. At a time when some fund companies are facing charges of allowing favored clients to skirt trading rules, ETFs offer a scandal-free alternative.

But the main advantage of ETFs is that sometimes they are even cheaper than regular index funds. Consider this: The iShares S&P 500 ( IVV , news , msgs ) ETF, which tracks the S&P 500, charges just 0.09% of assets -- half of what Vanguard 500 Index costs. And ETFs are more tax-friendly than their conventional index-fund cousins. If you're trying to harvest a tax loss or realize a gain, ETFs allow you to lock in your price with certainty.

The downside is that you'll pay commission every time you trade an ETF. If you're a buy-and-hold investor, it will take just a couple of years for an ETF's lower expense ratio to recoup the purchase cost at today's cut-rate commissions. If you plan to add to your investments periodically, however, conventional index funds will be cheaper by far.

There's an ETF for nearly any investment taste -- some 150-plus in all, with assets of $179 billion. Leave the narrow market slices (Singapore and biotech, for example) to those who favor the risky and complex. And stick with the popular offerings -- the more heavily traded an ETF is, the closer its performance will hew to that of its benchmark.

ETFs are a great way for novice investors to spread out. Joseph Blount, 25, found iShares S&P SmallCap 600 ( IJR , news , msgs ) a perfect complement to his large-company index fund. "It's a cheap way to get broad coverage" in the small-company market, says Blount, an engineer for Sun Microsystems who lives in El Dorado, Kan. And rewarding: The ETF returned an annualized 8% for the three-year period to Aug. 2.

For a basic all-ETF portfolio, put 80% of your assets in Vanguard's Total Stock Market Vipers ( VTI , news , msgs ) , which tracks the Wilshire 5000, and 20% in iShares Lehman Aggregate Bond ( AGG , news , msgs ) . A more finely tuned stock stake might be divided between iShares S&P 500 and iShares Russell 2000 ( IWM , news , msgs ) , a small-company ETF. Add foreign flair with iShares MSCI EAFE ( EFA , news , msgs ) , which tracks a broad-based overseas index.

3: Target one fund for life
Have we already gotten too complicated for you? Let's step back. A number of fund companies will assemble a portfolio for you. All you need to do is tell them the date by which you need your money. So-called target-maturity funds adjust the mix of assets in your portfolio, becoming increasingly conservative as retirement, college or any other goal nears. No need to rebalance your mix of holdings to stay on track, no need to fret about taking appropriate risks for your time horizon.

Cut the complexity

Put your deposits on autopilot. Set up an automatic transfer of as little as $50 from your bank account to your mutual fund, either monthly or quarterly. The arrangement is not only simple, but also will take emotion out of the investing decision.

Shop at the supermarket. Like a grocery store, fund supermarkets, such as those offered by Charles Schwab, TD Waterhouse and Fidelity's brokerage unit, allow access to a wide variety of funds from different families under one account umbrella. Supermarkets also let you buy in to some high-minimum funds with less money. And no matter how many funds you own, from how many different families, you get just one statement.

Don't reinvent the wheel. If you've chosen funds you like, chances are they'll work in many of your family's accounts -- such as your 401(k) accounts, your kids' college kitties and your IRAs. That way, you'll streamline the number of funds you need to watch.

Don't second-guess. Once you've identified an appropriate investment for your goals, don't agonize over other opportunities or parse too finely the differences between your choice and similar options. And don't trade later for whatever's hot at the moment.

Some investors have made one-stop shopping a hot investment trend, even though most target funds are too young to have meaningful track records. Each target fund invests in a handful of other funds within its respective family. As the target date approaches, the fund becomes more conservative by trimming its stock allocation and boosting its bond holdings. At Vanguard and in the T. Rowe Price Retirement funds, you'll pay a weighted average of the underlying funds' expenses to invest in the target funds, ranging from 0.21% of assets to 0.23% at Vanguard and from 0.6% to 0.85% at T. Rowe Price. Expense ratios for Fidelity's Freedom funds, which include a small fee on top of the underlying funds' charges, range from 0.66% to 0.89%.

The more crucial issue to address is the mix of assets in different target funds. The T. Rowe Price Retirement funds remain more aggressive throughout their lifetimes, with 55% of assets earmarked for stocks at the target dates. The shift from stocks to bonds continues, however, until only 20% is allocated to stocks 30 years after the target date. Price argues that a hefty stake in stocks boosts the chance that you won't outlive your retirement assets, and we tend to agree. Vanguard's target funds, by contrast, cater to conservatives, holding 30% to 35% in stocks at their target dates.

The strong suit of target funds is also their drawback. "They're cookie-cutter portfolios," says John Markese, president of the American Association of Individual Investors. "They assume everyone with the same wrinkles has the same circumstances." A 44-year-old who wants to retire early and has a spouse with a pension plan might not want to invest the same way as a 56-year-old with nothing but his 401(k) to live on. But for Fecondo, a married soccer dad with three girls, the trade-off is worth it. "I wanted something I didn't have to think about."

4: Find your comfort zone
Investors who relish more responsibility can choose the risk profile that's right for them at different periods in their life -- and still keep things simple. "Lifestyle," or "life cycle," funds invest in a fairly static mix of stocks, bonds and cash, but the funds themselves range from ultraconservative to aggressive. It's up to you to switch from one to the next as your circumstances change (bearing in mind the tax consequences if you sell a fund outside of a retirement account).

Two fine lifestyle choices are Vanguard's LifeStrategy funds and T. Rowe Price's Personal Strategy funds. Vanguard's four offerings invest in other Vanguard funds -- three index funds and an asset-allocation fund that invests directly in stocks and bonds. Price's three Personal Strategy funds invest directly in stocks and bonds, drawing on selections from the firm's other managers. Both firms' middle-of-the-road portfolios -- Vanguard's Moderate Growth ( VSMGX ) and Price's Balanced ( TRPBX ) -- outpaced the S&P 500 over the past five years, with annualized returns of 3% and 4%, respectively, compared with the index's loss of 2% per year compounded.

5: Let someone else do it
Retirement investors who crave simplicity are getting their wish. After years of mounting complexity, 401(k) accounts are headed in the other direction. Employers are increasingly offering workers the option of a managed 401(k) account -- a turnkey savings solution that does all but spend the money for you. "Remember the '90s? Investing was a spectator sport," says David Wray, president of the Profit Sharing/401(k) Council of America. "In the past three years, a lot of people found out that investing takes a tremendous amount of work and that they don't want to do that work."

Enter the managed 401(k). Check the box on your enrollment form, supply some information about your assets and retirement plans, and you'll be automatically invested in a diversified mix of funds that most match your goals. Your holdings will be rebalanced quarterly. And, in some cases, your contributions will automatically increase every year, say 2%, up to a preset maximum. As gold-watch day approaches, your investments automatically turn more conservative. Going automated will cost anywhere from 0.1% to 0.8% of assets -- a bargain considering the 1% of assets that private money managers charge.

Not surprisingly, workers everywhere are checking that box. "Where it's been introduced, 75% of new hires are signing up," says Wray, who expects such managed-account offerings to be standard within five to 10 years. Some 22% of retirement-plan sponsors now offer some form of a managed 401(k).

Use tax breaks
See if your employer offers a Dependent Care Account, a type of Flexible Spending Account, to save up to $5,000 in pre-tax dollars for day care (or elder care). Or take the Dependent Care Tax Credit on your tax return for 20-35% of up to $3,000 in child care for one child.

Flex your schedules
Ask your employer if you can change your schedule to be home earlier or leave for work later. Or see if you can work from home one day a week.

Keep it in the family
Talk to relatives to see if they would watch the children.

Barter, swap and share
Find out if your child's car center allows you to volunteer, donate goods or make in-kind contributions to save money. Many parents also share care givers.

Become an entrepreneur
Start a side business to pay for child care costs.

Get financial advice
Talk to a financial advisor to determine the smartest way to pay for child care.

Stick to the edges.
Shop the perimeter of the store where the fresh fruit, vegetables, dairy and meats are.
Foods that aren’t pre-packaged are healthier and go further.

Shop early and alone.
At the end of the day, you’re tired and more likely to buy sweets and snacks.
A “helper” just helps you fill the cart with items you didn’t plan to purchase.

Learn the rules.
Check ads for the items you always buy and resist others.
Don’t shop hungry or angry.
Buy items that expire that day and use immediately or freeze them

Know when to use a list and when not to use a list.
Use a list for the items you always buy or need.
Don’t use a list to take advantage of the freshest vegetables and manager’s specials.

Check high and low shelves for the best deals.
Stores put the highest-priced items where they’re most convenient.
You can save up to 40% buying generics or store brands.

As recent college graduates across the country prepare to embark on their careers, they leave behind the security of the university and face a world full of debt, student loans, bills, and responsibility (CNNMoney.com April 26, 2004).

Natural disasters can strike suddenly, at any time, and anywhere. It’s important to take steps to protect your family and your property, and also protect against the financial consequences of a disaster (Pueblo.gsa.gov/cic).

The National Endowment and Financial Education (NEFE), the American Red Cross, and the Federal Emergency Management Agency (FEMA), recommend following these tips before the unexpected becomes a harsh reality.

The recent flurry of worms and viruses that have appeared on the Internet carry with them a variety of problems. Some worms have the capability to install software on an end user's computer that specifically seeks out Internet banking or financial data, with the intent of communicating that data back to the attacker who wrote the worm.

These worms target the vulnerabilities of the end users' computers. A financial institution such as California Coast Credit Union cannot prevent such worms from being sent out and infecting people's computers. What we can do is ensure that our own systems are virus-free, properly patched and that our members are knowledgeable of the risks.

As an end user of Internet financial software you should be aware of the following precautions you should take:

Face the facts--Get out all your credit card bills and look at the total. This will give you a reality check of what you’re facing, and the sooner you start working on it, the better off you’ll be.

The holiday season is over and the new year brings us the chance to “start over” with some smart financial moves. The following is a list of some tips to have yourself a “Happy Financial New Year.”