Making money: What the experts say

When bias costs billions

Your fund manager may be “too much of a homebody,” said Ian Salisbury in SmartMoney.com, and it could be hurting your portfolio. Professional investment managers collect billions in fees to scour the market for bargains that ordinary investors would never find on their own. But a recent study from Indiana University’s Kelley School of Business suggests that “portfolio managers overweight companies based in the state where they grew up by 12 percent on average.” Given the size of the mutual fund industry, this “hometown bias” accounts for about $31 billion in investments each year. The bias appears to be stronger with younger investment managers, “suggesting the quirk may be tied to experience.” And it poses a risk to your portfolio since companies in the same state tend to be affected by similar business trends. You could be “too concentrated in one area of the economy,” said study co-author Scott Yonker.

Tax credits for summer camp

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With summer here, parents will be pleased to hear they can get a tax credit or use money in a flexible spending account for their kids’ day camp, said Kimberly Lankford in Kiplinger.com. If your child is younger than 13 and you send him to day camp while both you and your spouse work or look for work, you can use your flexible spending account for costs. “The key is that only summer day camp counts—not overnight camp.” The criteria are the same for the child-care tax credit. Families can count up to $3,000 in expenses for one child or up to $6,000 for two or more children. But you have to choose: You can’t use the flexible spending account and the tax credit for the same expenses.

Airing credit card complaints

“Want to know how your credit card company treats its customers?” asked Ruth Simon in WSJ.com. It’s now easier to find out. Last week, the Consumer Financial Protection Bureau unveiled a searchable credit card complaint database, available at consumerfinance.gov/complaintdatabase. So far, the database includes only complaints back to June 1, but the bureau says it will add the roughly 17,000 additional complaints it has received since last July over the next few months. Consumers can sort results by company name and type of complaint, as well as by whether a case closed with an explanation or monetary relief. Billing disputes and gripes about interest rates are currently the top grievances.