Worked Up About Y2K? Get it In Writing

Q. I've read dire predictions related to the computer problems associated with the year 2000 (Y2K). We are told that we may be without food, bank accounts, power, etc. Is this inflammatory writing, or should we doing something to protect ourselves?

- R.D.

via e-mail

A. Sounds inflammatory to us. While there are still serious problems to be resolved regarding the Y2K problem, just about everyone involved - governments, banks, and businesses - is working flat out to be ready.

Most financial institutions are reworking computer programs, says a spokesman for the American Bankers Association in Washington. Some smaller banks may be less prepared than larger institutions, so ask your bank about its plans.

Meantime, it may be prudent to keep detailed records (on hard copy, outside your computer system) on all your accounts and assets.

Q. I am self-employed with a Keogh account in a single mutual fund. Can I transfer assets - without tax liability - to another fund and disperse money into more than one fund?

- J.V.H.D.,

Piermont, N.Y.

A. You can almost always have Keogh money in more than one fund from your fund company, says David Bendix, a financial planner in Uniondale, N.Y.

If you have a Keogh with XYZ Mutual Fund Group, your investment choices are limited to funds within that company, and there is usually no transaction charge or tax liability when you switch funds within that company account. But check with the company.

If you're not satisfied with your company's choices, then consider a self-directed plan with another fund company or brokerage firm - Donaldson, Lufkin & Jenrette, for example, allows self-directed Keoghs, Mr. Bendix says. (Don't touch the money yourself; have the custodians make the transfer.)

If you can no longer make such a change, Bendix says, have the existing Keogh directly transferred into an IRA. Then open a new self-directed Keogh.

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