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IRAand is fundinga401(k) atwork.My daughter’s IRA, smaller because she’s younger, is also growing (I matched her earnings, too).Unfortunately, in thestart- up where she currently works, 401(k)s are still anunknown. Okay. That’s my kids. What about yours? Let’s go back and review my thinking on the teenage Roth IRA, so youwon’t put thisoff. It’s important and especially timely given that the April 15 deadline for contributions seems to sneak up quickly on those who’ve pro- crastinated aboutmaking their deposits. The Roth IRA is an excellent retire- ment savings vehicle for younger peo- ple. Since their introduction in 1998, Roth IRAs have been garnering respect (and dollars) from knowledgeable investors for the advantages they have over traditional IRAs. While a traditional IRA allows you to deduct your contributions pre-tax, it also locks your money in until you are 59½ years old (unless you feel like paying a 10% fee onwithdrawals, plus income taxes), and forces you to take distributions upon reaching the age of 70½, paying income taxes at your future—and possibly higher—tax rate.

what Mr. or Ms. Millennial earned in 2014 and fund that IRA account before theApril 15 deadline. I know that it would be nice if junior spenders could take on this chore them- selves, but how many teens do you knowwho read investment newsletters? And if they did, where would they get the money to stash in an IRA? Most spend what they make, and then some. That’s why parents (or grandparents) were invented. When I first opened an IRA for my then-teenaged son, bothheandmywife looked at me like I’d just announced my intention to run for President. My daughter just smiled and kept reading her book. The joke ison them,ofcourse.Thanks tomematchingmy son’s summer earn- ings and putting the money away in a Roth IRA, the now almost-30-year-old has already built up a tidy sum that will continue to grow for many years to come. It won’t pay for a nursing home just yet, but then again, he’s got a few years before that becomes an issue.And he’s learned the value of early and long- term investing and compounding.With a good job, he’s already savingoutside his

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care less about retirement. He’s more interested in Instagram and Snapchat.” Maybe. Maybe not. Last year I helped a number of 25-year-old friends of my daughter with some fundamen- tal financial and investment planning. They needed it; they knew they needed it; and they were very appreciative of the help. In fact, one of them wrote a blog post about it, then went on to put hermoney towork for her future. It’s too bad more people don’t help the young get started early on their investment careers, because the perfect time to learn about saving and invest- ing is when your portfolio is small enough that your mistakes won’t kill you. Also, it’s a time when a new investor can begin to develop lifelong habits that will stand them in good stead as they pass through their 30s, 40s and beyond. Time is on a kid’s side, and by help- ing them start to build aRoth IRAwith earnings from summer and part-time jobs, youmay be able tomake amean- ingful impression on him or her. Then, next March andApril, you can tote up

INTERVIEW > DONALD KILBRIDE CautiousConcentration

What is it thatmakes your companiesattractive? The companies thatwe own are the best sources of total return that I can find. They are the ones that best balance the two dimensions I always talk about—value creation and value distribution. Look atMicrosoft, for example. Set asidewhat is happening in the business right at themoment—you’ve got a company that I am very con- fident is going to continue to create valuewhen youmeasure it by the steadiness of its profitability, their ability to convert earnings into free cash, and low capital intensity. They continue to do it every, every year. Taking that engine of value creation and translating it into value distribu- tion, which is the thingwe are trying to solve for—dividend growth—it’s a compellingmodel. Forme, wealth creation is two things: Can you create value?And can you give it back tome? Are therebetterorworsepocketsof valuationout in themarket, if any? Forme, it comes down to—brick by brick—individual companies. Having said that, there are certainly areas or pockets of themarket or industrieswhere one could argue there is potentiallymore value. That would largely be in industries that have lagged. Tome, the one that leaps out off the page themost is energy. But I

YOU’VEHEARDME call the stocks in Dividend Growth ’s portfolio battleship balance-sheet companies. The admiral watching over this con- centrated fleet is Don Kilbride, 49, a growth and incomemanager atWellingtonManagement who talks fast and thinks even faster. He, Jeff DeMaso and I recently spoke about the portfolio, the state

of theworld’smarkets andDon’s cautious outlook concerning future attempts to rein in an unprecedented level of global central bank liquid- ity. Listen in… Don, ona relativebasis, valuations in the large-capandparticu- larly themega-cap space seem tobe themost compelling. But are theycompellingon their own? I think about valuation in the portfolio as sort of eclectic. Some stocks in the portfolio, from a classic valuation standpoint, look really, really inexpensive tome. Generally, they are pretty attractive, and I think that probably applies to themega-caps broadly. I don’t traffic in themid- and small-cap areas—but it feels tome like [mega-cap stocks] are relatively more interesting than just about anything else in themarket.

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