In This Issue:

• Would You Loan Your Money To a Total Stranger?
• Selling Your Business: What's its Value?
• Finding Lost Pensions
• Kemper Capital Management – Loose Change
  Bonds—A Balancing Act for Your Portfolio
  Make the Most of Your 401(k)
• Kemper Technology Consulting
  CRM is More Than a Product—It's a Philosophy
  Protect Your Personal Information from Phishing

Imagine giving someone you do not know at all a loan of thousands of dollars of your money, at no benefit to you. You would receive no interest income from loaning this unknown person or group your money. You would just dole out about $40 every week, an average of $2,000 a year from your paycheck, and receive nothing in return. Doesn't sound like a good deal at all does it? Who would agree to such an arrangement? Millions of American taxpayers did just that in 2003 when they paid too much in taxes from their payroll every week.

Yes, we must pay taxes–that is a given. But millions of us pay more than we should, week after week; then, between January and April of the following year, we file our returns and spend the next few weeks racing to the mailbox or bank to see if our refund check has arrived. Or, we find we did not pay nearly enough, and are faced with a hefty balance due on April 15–one that perhaps we are not prepared to pay.

According to the IRS, the following are some facts about tax refunds:

•		Federal tax refunds to individuals totaled more than $202 billion last year
•		Nearly 100 million taxpayers received refunds (3 of 4 returns)
•		The average refund was slightly more than $2,000
•		All figures to date point to these numbers increasing again this year

		Tax planning is a critical step to avoiding these scenarios; adjustments in withholding, estimated tax payments, and other options could help most taxpayers keep more of their hard-earned money each week, or on April 15. It's not too late in the calendar year to make adjustments that can benefit you once tax-time rolls around. You earned it–we can help you keep it. Contact your local Kemper CPA Group LLP office for tax planning services and let us help you plan ahead so you do not owe a hefty tax bill, or become an interest-free lender of your money. Contact us today!

Many things might necessitate the sale of your business, and knowing what your business is worth can help you make the sale wisely. However, establishing your business' worth can be very complicated, and posting a big "For Sale" sign in your front window can greatly devalue the business you've worked so hard to create.

Independent business valuators can help with the delicate matter of finding a suitable buyer without exposing your company to the risk of conflict between interested parties. Business valuation can be a complex undertaking, requiring knowledge in accounting, tax, finance, economics, and litigation support. Therefore, you should never try to sell a business without the help of a reliable third party.

Normally, you'll need to gather several years of financial records to verify your business' profitability and to answer questions about the future success of the company. Other documents that you'll need to prove your business' value include:

•		Income statements, balance sheets, and income tax returns from the last three to five years
•		Records of accounts payable and receivable
•		Copies of any mortgages owed
•		Present lease and corporate books or partnership agreement

You will also want to compile a list of current clients, customers, and suppliers, as well as documentation proving any existing contracts with employees. Also contributing to your company's value is its goodwill—the reputation you have built with customers, vendors, and the community.

Kemper CPA Group LLP understands the unique approach that is determined by the fundamental purpose of each business valuation. During times when personal and emotional issues may influence a person's judgment, our professionals are qualified to provide an objective, independent, knowledgeable, and credible valuation. Contact us today!

The Pension Benefit Guaranty Corporation (PBGC), a U.S. agency that guarantees payment of basic pension benefits, currently has over $75 Million in unclaimed pensions. The 26,000 people in PBGC's database are owed money from defined pension plans that have folded, and they may still be able to claim it.

PBGC's list currently identifies over 5,000 companies where pension plans were closed and employees couldn't be found—most companies involved were in the airline, steel, transportation, machinery, retail trade, apparel, and financial service industries. The states with the most missing pension plan participants are New York, California, Texas, New Jersey, and Pennsylvania.

If you think that you or someone you know may be owed money from a terminated pension plan, you can access PBGC's Pension Search directory at pbgc.gov/search.
  

Bonds—A Balancing Act for Your Portfolio
 
You probably know that bonds can add diversification to your portfolio and help cushion it against major losses if the stock market tumbles. But, if that's the only thing you know about bonds, maybe it's time for a bond lesson.

A bond is a debt security or IOU. When you buy a bond, you're lending money to a government, corporation, municipality, federal agency, or other issuer. In return for using your money, the bond issuer agrees to pay a specified amount of interest for a certain period of time and then pay you the bond's face value at maturity.

They're Not All the Same
Like stocks, bonds come in several varieties. Reviewing factors such as interest rate, time to maturity, credit quality, and tax status can help you determine which bonds or bond funds are most suitable for your financial goals.

•		Treasury Bonds are issued by the federal government to support operations and pay off maturing debt. They typically present little risk to your principal but generally pay relatively low interest rates.
•		Agency Bonds are issued by federal and state agencies to raise money for projects. Mortgage associations like Fannie Mae and Ginnie Mae issue agency bonds. The interest on some—but not all—agency bonds is exempt from state and local taxes.
•		Corporate Bonds are issued by companies wanting to raise money for expansion and other activities. Although corporate bonds offer potentially higher yields than government bonds, they present more risk to your principal. Unless purchased through a mutual fund, corporate bonds usually require a large minimum investment.
•		Municipal Bonds are issued by state, city, and local governments to pay for construction and other projects. While their interest rates may be lower than the interest rates on some corporate bonds, the interest on municipal bonds is generally exempt from federal—and often state and local—taxes, which may make them particularly appealing to investors in high tax brackets.

You can diversify your bond investments by investing in bond mutual funds. In addition to spreading your risk across a broad range of bonds with varying maturity dates, bond funds allow you to choose between reinvesting the interest payments or receiving periodic distributions.

Where's the Risk?
Although bonds are less volatile investments than stocks, they're not without risks. Changes in interest rates typically affect bond prices. When interest rates rise, prices of outstanding bonds fall. When interest rates fall, prices of outstanding bonds rise. The longer it takes for a bond to mature, the greater the risk that prices will fluctuate. And keep in mind that you may lose money if you sell bonds before the maturity date.

Bonds carry another type of risk—the risk that the issuer will be unable to pay interest or repay principal. Bonds with a high risk of default usually pay higher interest rates to compensate. You can assess a bond's default risk by checking its credit rating with one of the major rating agencies, such as Standard & Poor's and Moody's. These services rank bonds within two categories: investment grade or below investment grade.

Your financial professional can explain all aspects of bond investing and help you decide if bonds are appropriate for your portfolio.

For more financial advice, click here to view the July/August 2004 issue of Kemper Capital Management's online newsletter "Loose Change"! If after reading the newsletter you have any questions or would like to discuss your investment needs, contact the friendly professionals at Kemper Capital Management today to schedule an appointment to discuss your investing needs!

Investment advisory services offered by KCPAG Financial Advisors LLC, a registered investment advisor. Securities offered through CapPro Brokerage Services, Inc., member NASD & SIPC. Insurance services offered through KCPAG Insurance Services LLC.
   
Make the Most of Your 401(k)
 

Does your employer offer a 401(k) retirement savings plan? If so, you should make the most of this opportunity to save for your retirement years. Fewer employers are offering traditional pension plans these days, and the future of Social Security is uncertain. So, you'll need a dependable source of income if you want to maintain your standard of living when you retire. Saving in your 401(k) plan may be the best way to reach your goal of a financially secure retirement.

Start as Soon as Possible
As soon as you are eligible, you should start saving for retirement in your 401(k) plan, even if you save only a small portion of your paycheck at first. The sooner you start saving, the more time your savings will have to benefit from compounding. Plus, your 401(k) savings are tax deferred. Neither your contributions nor your investment earnings are taxed until you begin to withdraw money, usually at retirement.

Save as Much as Possible
Your retirement may last for 20 years or longer. And you will have to contend with the effects of inflation on your nest egg. So, you'll want to contribute as much as you can to your 401(k). As your income increases and you earn more during your working years, consider increasing the percentage you're saving for retirement. Also consider putting some of your 401(k) money into stock investments, which have the potential to earn returns that stay ahead of inflation.

Stay as Long as Possible
No matter how tempting it may be, don't cash out your 401(k) account if you change jobs. If you do, you may have to pay significant taxes and penalties on the money. And you may hurt your chances of saving enough for retirement. Instead, consider leaving the money in the 401(k) or rolling it over to an IRA or to your new employer's retirement plan.

For more financial advice, click here to view the July/August 2004 issue of Kemper Capital Management's online newsletter "Loose Change"! If you would like more specific advice about investing in a 401(k) plan, contact Kemper Capital Management today!

Investment advisory services offered by KCPAG Financial Advisors LLC, a registered investment advisor. Securities offered through CapPro Brokerage Services, Inc., member NASD & SIPC. Insurance services offered through KCPAG Insurance Services LLC.
 

 
It seems there is always a threat looming over you as you ponder the unread messages in your e-mail inbox. That unseen, unheard, but very real threat from the scam artists, thieves, and spammers that lurk in cyberspace, just waiting for their next victim. Opening e-mail is becoming a frightening experience–will you unleash a virus, or have spyware files written to your hard drive? And what about that message that looks like it might be from your bank–that could be important, and you should always open and respond to those, right? Not likely–err on the side of caution and delete that message–and then, contact your bank directly via telephone. You will find that your bank probably did not send that message, and would not request that you update critical personal information via e-mail.

Sensitive data such as social security numbers, bank account numbers and ATM or credit card PINs should never be communicated via e-mail–and those sending fraudulent e-mail messages seeking to obtain that critical data are guilty of a crime known as "phishing". The term comes from the fact that the messages are "fishing" for personal information such as bank account numbers, social security numbers, or the PIN for your ATM card. Some of the more recent phish subject lines, (from the Anti-Phishing Working Group), and the dates of the attacks include the following:
 

The sender/subject lines listed above are designed to alarm the recipient and make them think that their personal information has been compromised or a change has occurred with their bank or other account and immediate updates are needed to continue service or prevent harm to the user.

Recently, Citibank has become the most popular target with nearly 500 phishing attacks in one month. The e-mails appear very official and usually request that you login to a website to update your personal data. The website appears legitimate, enough so that millions of people have been duped into "updating" their personal data on these sites–when in fact they are simply giving away their social security numbers, credit card numbers, etc., to thieves. It is becoming more difficult to discern that the messages are fraudulent. But take heart–there are ways to protect yourself–the Anti-Phishing Working Group offers more information and is online at antiphishing.org/consumer_recs.html.

Always remember–do not divulge personal information such as social security numbers, credit card numbers, ATM card PINs, or bank account numbers, to any organization over the Internet that requests such data via e-mail. Your bank or any other organization with which you conduct business will have information posted on its website that explains how it obtains and uses private data/information. Read the policies carefully and always contact your bank or other organization directly via telephone if you believe you have received a phishing e-mail and are confused as to what steps to take. Be informed–don't be a victim–and protect your vital personal information.