What the experts say

More time for your taxes

Uncle Sam’s tax deadline is just days away, so if you haven’t filed yet, “now could be the time to come up with a backup plan,” said Bill Bischoff in SmartMoney. “Fortunately, the Internal Revenue Service has some sympathy for procrastinators.” Filing an extension by April 15 will “keep the feds off your back all the way until Oct. 15, 2008.” If you’ve put off filing your taxes because you owe big bucks, the extra time won’t help you. Before filing for an extension, you still need to estimate your total tax liability. “And if it turns out that you owe money, you’re going to have to ante up, based on your tax estimate.” If the estimate is too low, you’ll be charged interest on the outstanding balance. If the payment is way off the mark, you’ll also incur a 0.5 percent per month “failure-to-pay” penalty.

Don’t rely on company stock

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The “rapid collapse” of Bear Stearns stock is a new reminder of the risks of putting too much money into your company’s stock, said Paul J. Lim in The New York Times. Stockholders should have learned their lesson after the collapses of Enron and WorldCom nearly wiped out the retirement funds of many of those companies’ employees. Yet Hewitt Associates reports that investors whose 401(k) plans include company stock have an average of 16 percent of savings tied up in the company—“still way too much to invest in a single stock, let alone that of your own employer.” Ideally, no more than 5 percent of your savings should be tied to your company stock, says investment advisor Mike Scarborough. “This is especially true for employees of a large company whose stock is widely held, because they may already own some of its stock indirectly.”

Building your dream

“Behind the dark clouds hanging over the housing market is a very compelling silver lining,” said Carla Fried in Money. “The cost of building the home of your dreams is coming down.” The price of building materials is sinking “like a poorly laid foundation.” Framing lumber costs, on average, 18 percent less than it did 18 months ago. Sheetrock drywall is 40 percent cheaper. Contractors no longer have six-month waiting lists, and they’re more open to negotiating. And land, which is “often the single biggest expense for custom homes,” is about 20 percent cheaper in many markets. “In terms of finding the land you want at a good price, this is the best market that I have seen in my 30 years of home building,” says Carl Heldmann, author of Be Your Own House Contractor.