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What the experts say

Junk bond jitters; 401(k) plans recover; Time for a raise?

Junk bond jittersHigh-yield bonds have had a great run over the past few years, said Jane J. Kim in The Wall Street Journal. But after experiencing jumps of 57.5 percent in 2009 and 15.2 percent in 2010, the market for so-called junk bonds is looking significantly riskier. Problems in Japan, coupled with Mideast turmoil, have driven down prices on these bonds in recent weeks, and “several” high-yield issues have been postponed. Global events aren’t the only concern. As more investors poured money into junk bonds in recent years, companies began issuing bonds with “weaker investor protections.” This combination of factors suggests that investors “would be wise to exercise caution.” A better bet right now: emerging-market bond funds, which offer high yields, but without the credit concerns hanging over many developed countries.

401(k) plans recoverAmericans who cringed at their depleted 401(k) balances during the recession are finally “finding good news inside the envelope,” said David Pitt in the Associated Press. Thanks in part to participants’ continuing contributions, nine in 10 of these popular retirement plans “are at least back to where they were in October 2007, the peak of the stock market.” Some workers have gotten back to even more quickly than others. The accounts of those with 10 to 29 years at their current jobs are still 5 to 8 percent below their peak, in part because two years of new contributions have done little to cover their initial losses.

Time for a raise?A pay raise may finally be in the cards, said Anne Fisher in Fortune. Merit raises are expected to increase slightly this year and “salary freezes are fast fading into history.” But there’s a big caveat: If you want a meaningful bump you’ll need to “far exceed” expectations. What’s more, you can’t assume the boss knows about your achievements. Instead, make a list of specific gains—ideally ones you can quantify—and e-mail them to the higher-ups. Come review time, use that list to “make your case.” If at first you don’t succeed, continue keeping tabs of your accomplishments and share them in monthly e-mails. If your current employer doesn’t budge, you’ll have “excellent talking points” for job interviews when it’s time to move on.

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