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Lucky 13 ways to avoid jinxing your finances

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I am a jinx.

If I wish you good luck, you'll slip on a banana peel.In the past, I have jinxed entire cities. I moved to Pittsburgh in 1980 and the steel industry promptly collapsed.

As a jinx, I have learned to tread softly. I don't dare follow my own instincts. Instead, I look for wise people and do what they do.

So this week I talked to some certified financial planners, Steve Robbins of Titan Value Equities, Jim Smith of Independent Financial Planners and Eileen Dorsey of Money Consultants Inc. They provided 13 ways to avoid jinxing your finances:

- Save something - even if it's just a little. This is obvious. You need three to six months of living expenses tucked safely away in a bank or money market fund for emergencies. With that in hand, start investing for longer-term goals.

- Shun credit card debt. With interest rates averaging about 18 percent, they're the primrose path to bankruptcy. Pay the plastic bloodsuckers off in full each month.

- Join the 401 plan at work and contribute at least enough to get the entire employer match. The boss is giving away money here. Why not grab it? If the boss doesn't offer a 401 open an IRA. They're the best way to stay out of a tarpaper shack come retirement.

- Educate yourself. Get a book on personal financial planning and investing. "The Money Book of Personal Finance" is excellent but there are plenty of other good ones. Do this and two things will happen: You'll learn how to plot your own future, and you'll learn to spot the barracudas swimming among a generally benign group of brokers, insurance agents and bankers.

- Buy enough insurance but not too much. A single person probably doesn't need life coverage. A young family with children needs lots. Term insurance provides the most coverage for the least money. Also, get health coverage, and think about a disability policy.

Once you've got some money to invest, follow these rules:

- Never invest in anything you don't understand. Some of the saddest suckers on this planet got hornswaggled on commodities, precious metals or other offbeat investments.

- Never invest with a stranger who calls you up on the phone. This is doubly true if he's calling long-distance. If you're looking for a broker, use references from friends.

- Stay away from penny stocks. They're the bait dangled by scam artists.

- Don't load up on stock in your own company. You don't want your paycheck and your fortune riding on the same horse.

- Diversify your portfolio. Mutual funds are best for this. Spread your investments amid large-company funds and small, growth and value-oriented funds.

- Shun annuities unless you're maxed out on contributions to your tax-sheltered 401 plan or IRA. Their added fees are an unneeded drain.

- Don't panic when the stock market drops: Selling out at the market low is a bad mistake. Money in stocks should be money you won't need for five years. With that time frame, you'll probably do well if you just sit tight.

- Get a handle on your tolerance for risk. The average bear market knocks 37 percent off stock values. Growth stocks dip 50 percent and aggressive growth portfolios risk as much as 70 percent decline. If your ulcer couldn't stand that, ease back on your riskier bets.

Good luck.