Sound Financial Advice by David McPherson, founder of Four Ponds Financial Planning LLC, Falmouth and Mansfield, Mass.

Time to dump that fund?

This week for ABCNews.com, I consider a reader's question about when is it time to dump a lousy mutual fund. The answer, in part, is to be sure you're making the right comparisons. 

Study those account statements

Today's ABCNews.com column responded to a reader question about how to read investment account statements. The reader's question came in response to an earlier column about fraud allegations made against two financial planners.

Last week's column featured a "Financial Checkup" for a Michigan couple worried about their job security.

Even in tough times, index funds beat actively managed

Here's one more reason I favor index mutual funds and exchange traded funds over actively managed funds: Managed Funds Take Beating from Indexes (Wall Street Journal, April 22, 2009). The evidence is overwhelming, yet investors are always searching for the minority of managers who can beat the indexes for even just a few years.

Mutual fund fees on the rise.

After the pounding investors have taken, the last thing they want to hear is that the cost of investing is increasing. Yet that's exactly what's expected to occur with mutual funds. In this week's ABCNews.com column, I review a recent report from Morningstar that points to evidence mutual fund expense ratios are rising.

My advice is that investors pay close attention to expense ratios. Higher-cost funds tend to do worse than lower-cost ones.

Paying capital gains on money-losing funds

This week's ABCNews.com column explains why some mutual fund shareholders are facing a tax bill on capital gains despite watching their funds lose more than 40 percent of their value this year. Capital gains payouts on a money-losing fund can be tough to grasp, yet it's reality for many mutual fund investors.

An important point to keep in mind is this problem applies only to mutual funds held in a taxable account. Mutual funds held in an account shielded from taxation, such as an IRA or 401(k), are not subject to taxation on capital gains.

If you own mutual funds in a taxable account, the first thing you should do is to check if your funds are planning a capital gains payout in the next few weeks.

Last week's column, explored the benefits of buying an immediate annuity upon retirement. I like to think of it as buying your own pension.

On the shelves: Investing in uncertain times

Looking for a guidebook to help you navigate the current market turmoil?

You might want to check out Investing in an Uncertain Economy for Dummies, a new title in the Dummies series of how-to guide books.

Members of the Garrett Planning Network, including me, wrote the book as a collaborative effort late in the spring. Little did we know how timely it would become by the time publication rolled around in October.

Network founder Sheryl Garrett is listed as lead author, but dozens of financial planners from around the country wrote individual chapters.

My chapter, number 42: "Diversifying Your Stock Portfolio by Size," explains the differences between large caps, mid caps and small caps and the advantages and disadvantages of each. I also served as a member of the Garrett network editing team that helped coordinate more than 80 individual contributions.

Here's a press release I wrote announcing the book's publication.

Published by Wiley, the book's cover price stands at $21.99, though it can be found for less.

I won't be making any money off book sales myself, but I will be looking for opportunities to publicize the book (and figure out what to do with the 20 copies sitting in my office.) Contact me if you have any suggestions.

Catching up on ABCNews.com

Here are links to past ABCNews.com columns that were deleted during a recent blog upgrade:

• Why 401(k)s Matter to Your Job Hunt / Aug. 19, 2008
• Act Now to Get Your Tax Rebate / Aug. 26, 2008
• Bank Failures: Protect Your Cash Now / Sept. 2, 2008 
• Fannie, Freddie and Your Investments / Sept. 9, 2008
• Wall Street Woes: Where to Put Your Cash / Sept. 15, 2008
• Smart Investing in a Market Panic / Sept. 23, 2008
• Protection for Investors: How it Works / Sept. 30, 2008 
• Is Your Money Market Safe? / Oct. 7, 2008
• Is Now the Time to Get Back Into Stocks / Oct. 14, 2008 

Target-date funds catch fire

The money keeps pouring into target-date mutual funds, according to new numbers from Financial Research Corp. as reported by the Wall Street Journal. Target-date funds are meant to make it easier to ensure workers are properly diversified in the Age of the 401(k).

Though some financial planners and investment managers deride them, my belief is the development of target-date funds is a positive thing. They need to be refined further, but they are just what's needed for those with little interest in making investment decisions on a regular basis.

Index funds for the new investor

My latest Net Gains column explores index funds for beginning investors. As stated in the column, I'm a believer in the benefits of index investing, but the minimum investment amounts required by some of the best index funds can be too high for many new investors looking to start a savings program.

Index funds with low minimums and reasonable expenses include the BlackRock S&P 500 Index Fund (MDSRX), Legg Mason Partners S&P 500 Index Fund (SBSPX) and three Schwab index funds,the Schwab 1000 (SNXFX), Total Stock Market (SWTIX) and S&P 500(SWPIX).

Magellan fund reopens to new investors

For the first time in more than a decade, the Fidelity Magellan Fund (FMAGX) is open to new investors as of today, Fidelity announced yesterday.

""Having been closed for more than a decade, Magellan's shareholder base has matured and, in the normal course of investing, many shareholders have continued to redeem assets as they've met their financial goals. In fact, 85% of the fund's assets are earmarked for retirement, and the Baby Boomer generation has now begun to retire and tap those dollars," Walter C. Donovan, president, Equity Division, Fidelity Management & Research Company, said in announcing the reopening."We believe that generating new sales to offset future redemptions will help stabilize the fund's cash flows and assist fund manager Harry Lange in most effectively directing investment strategies for the benefit of fund shareholders."

Morningstar forecasts "solid but not spectacular results" for Magellan and points would-be investors to Fidelity Growth Discovery (FDSVX).