Q: I notice that you seem to tout mutual funds regularly. But I have never seen you mention private ownership of individual stocks. I wonder if there is a reason. Our retirement is extremely comfortable because my father built a retirement fund -- a small fortune -- by buying individual stocks. They not only supported him and my mother, now they also support my husband and me (in addition to Social Security and my teacher retirement).

My folks lost their house in the Depression, and my dad decided that would never happen to them again. He began studying the stock market and, when he was able, he bought individual stocks for long-term investment. He said he only bought aces, straights and flushes. And he certainly did, because even in these times of upheaval, the stocks I inherited from him hardly fluctuate at all. That is why I wonder why you seem never to recommend his purchasing style. -- J.P., Kerrville, Texas

A: Your father was interested in investing. He also appears to have had very good judgment. That's a rare combination. Most people aren't very interested in investing. Many who are interested don't make good decisions. For these people -- the vast majority -- investing in mutual funds is a good alternative to individual stocks because owning a broad portfolio of stocks reduces risk. It can be done at very low expense, using index mutual funds or exchange-traded funds.


Q: How do you receive Social Security without being located? -- J.M., by e-mail

A: You can arrange for your benefits check to be automatically deposited into a checking account at a major bank that offers a large network of ATMs. This will give you access to cash virtually anywhere in the U.S. and in many places outside of the country.

As a consequence, you can move around at will, as many full-time RVers do -- and you'll never need to worry about checks being stolen from your mailbox.

You can learn how to get direct deposit by visiting the Social Security Web site, www.ssa.gov. You can have your other mail from Social Security sent to a mail box service and arrange for it to be forwarded at regular intervals.

If you are living on your Social Security or Supplemental Security Income (SSI) benefits alone, as many retirees and people on disability are, I want to offer a word of advice.

Be cautious about signing up for anything resembling a line of credit with the bank that accepts your benefits deposits. These credit lines have very high interest rates. You can quickly find that spending more than your monthly benefits will put you in a deep hole, much like servicing credit card debt.


Q: Thank you for your recent "dump your money manager" column. It was revealing. Where does the average guy, who uses a management firm of some sort (which usually lists its own fund performance comparisons and indexes, which of course he usually beats), get a list of index funds and their periodic performances to be used for comparisons? It would be nice to sit across from my adviser and have my own list of indexes to compare with his. -- P.L., Nashville, Tenn.

A: There are many ways to do this. One is to visit my Web site, http://assetbuilder.com, and check the performance figures for the Couch Potato Building Block portfolios. These are posted monthly and provide returns over a variety of time periods. You can also check the performance of the Vanguard Balanced Index fund (ticker: VBALX) on the Morningstar Web site.

Soon you will be able to judge the performance of your managed portfolio against a family of diversified index portfolios from iShares, which were launched only recently. These funds have expense ratios that range from only 0.31 percent to 0.34 percent. The funds have risk levels labeled conservative, moderate, growth and aggressive. You can learn more about them by visiting www.iShares.com.