THE NAIONAL COLLEGE NEWSPAPER

Dollars and Sense/APRIL 1992

Money for nothin'
'hy investing your dollars
makes more cents than ever
ByJULIE CARRICK
The Review, U. of Delaware
The lore of the impoverished student often is reality. You bounce
checks, skip bills and barely scrape by - even rely on the occasional
parental handout.
But the problem may not be how much money you have. It may be
what you're doing, or not doing, with it.
"There are alot of (investment) opportunities out there; students
just don't take advantage of them," said Robin Williams, an
investment analyst with the Wilmington Savings Fund Society.
Williams said students tend to put all their money in no-interest
checking accounts instead of stocks, bonds, mutual funds, CDs or
even savings accounts. Their money sits in financial limbo instead of
working for them.
Granted, she said, the old adage still rings true: you have to have
money to make money. But that doesn't necessarily mean that you
have to have a lot to make a lot.Just $50 or $100 a month can putyou
on the road to financial security. Youjust have to know your options.
Stocks
Stocks offer the highest earning potential of any investment, but
they come with no guarantees.
Purchasing stocks is essentially the same as owning a fraction of a
company. If the company fares well, the value of each share
increases. Unfortunately, stocks decrease in value as often as they
increase.
Serious stock market investors spread their money out over several
stocks to reduce the risk in case one stock "takes a dive." But
diversifying involves investing a great deal of money - money which
students often don't have.
Bonds
Purchasing a bond can be compared to lending money to a
company or government organization. Instead of owning a share of
the company, the investor receives the guarantee of reclaiming the
initial investment, plus interest, after a fixed amount of time.
However, if cashed too soon, bonds can involve severe penalties.
MutualFunds
Mutual funds attract young investors because the initial

Q Based onea savings account with 5 percent interest compounded annually.
O Mutual fund compounded annually.
O A total of $13,0 0would be invested afterte n years.
Source: The Investment Company of America
MEL MARCELO, UCSD GUARDIAN, U. OF CALIFORNIA, SAN DIEGO
investment can be as low as $250, can easily be expanded and can be
cashed at any time without penalties. Instead of putting a large sum
of money into purchasing one stock, investors pool their money with
other individuals to purchase a diversified stock portfolio.
Mutual funds generally prove secure because portfolio managers
redistribute investors' money according to changes in the market.
"Shareholders don't even need to understand the stock market to
make money," said Larry Schmittinger, vice president of the
investment firm Legg Mason Wood Walker, Inc.
Money Markets
Money market accounts are short-term mutual funds. Investors
jointly purchase a large stock portfolio for a short period of time.
Some money markets offer high interest rates, but the rates always
are relative to the risk of the stocks included in the portfolio.
Certificates of Deposit
Like money markets, CDs are short-term vehicles for guaranteed
returns at higher rates than simple savings accounts.
Instead of loaning money to a company, the investor lends money
to a bank with a promise not to withdraw the money for a specific
number of years. But be warned, early withdrawal penalties can
absorb all interest and deductfrom the original investment.

High-tech hackers scam for big bucks

By MICHELLE ROBERTS
The State Press, Arizona State U.
From credit card scams to mail-order and
phone fraud, college students are increas-
ingly involved in computer scams designed
to rip off major companies - and often are
paying a high price when caught.
Last month, three California State
Polytechnic U. sophomores were accused of
illegally collecting more than $90,000 worth
of merchandise in a year-long, on-campus
credit card swindling operation. Together
the three men face 16 felony charges ranging
in severity from possession of stolen property
- including a VCR, bike and fishtank - to
computer and credit card fraud.
"The computer crimes being committed
have everything to do with the knowledge
students have gotten at their schools,"
Berrett said, adding that students are using
their intelligence to hurt themselves.

"I can't think of a company in the nation
that will hire them," Berrett said.
Dave Banks, public relations manager for
U.S. West Communications, said his
company is often plagued by computer
"hackers" who make thousands of long-
distance calls to find valid calling-card
codes. Then they sell the phony numbers to
students who ring up their own bills. Many
hackers turn out to be college students. "I
guess college students, in general, are more
computer literate," he said.
Other common student crimes include
fake I.D. services, breaking into university
computerized class registration to gain
access into full or restricted classes and mail-
order fraud.
Maura O'Keefe, associate director for
consumer affairs for the Columbia House
tape and compact disc club, said the mobile
student lifestyle makes it easier for students
to take advantage of mail-order companies.

"The most common (scam) is when peo-
ple send in an application, we send out the
merchandise, and then we never hear from
them again," O'Keefe said, adding that
many students use false names and address-
es when applying for club membership.
Ralph Colin, a senior vice president of
Columbia Reecords, said university
administrators and campus police, with the
help of the postal service, also are coming
down hard on dishonest students.
"In one case, we had a young man from a
state college rip us off - he got into us for a
fair amount of money - thousands of
dollars," Colin said. "We got in touch with
campus police. (The student) had designs
on going to graduate school. As a result of
his dealing with Columbia House, he was
told (by the university) that he could forget
it until he got the matter cleared up. These
things definitely come back to haunt
students."

I--------------J S0 tRS INHNfalEJk!$Ikb E N1 wlhIPSCO' RP ,NOYBRH~
------ OPENING DAY: APRIL 17Tii.H T SUIS