Spring 2009

¬†¬†Welcome to the launch of CFM’s Newsletter.

We hope you find the information timely and useful. Please e-mail us with any feedback for future issues. Thank you for allowing us this form of communication to stay in contact with our valued clients. Happy Spring!

Sincerely, Linnea & Stacie

Is your money working for you?

Association Investments

In this current economic climate, interest rates are not providing the earnings potential that they used to. Given the low interest rates available, Associations may be tempted to go outside the generally accepted bounds of safe investing in an attempt to make more money. Association boards have a fiduciary responsibility to make smart investment decisions, most importantly protecting principal, in order to have their money work for them.

Most Associations are saving money for future large expenses with their reserves. The reserve cash provides the vehicle for potential investments. Having an investment policy is an important tool for the board to ensure conservative decision making with regard to investment options. At the very least, the investment policy should require the board place all association funds in government insured accounts, or similarly protected investments.

The policy should also prohibit putting more money in one account than the Federal Deposit Insurance Corporation (FDIC) will insure. The FDIC had a maximum protection of $100,000 until late last year. When the President signed the financial bailout bill, the protection increased to $250,000 temporarily until December 2009. It may be extended at that time, given the $100K figure has been in effect since 1980 and is extremely outdated.

Many Associations have more than $100K in their reserves and should consider investing any excess that is not anticipated to be spent in 2009. We have relationships with your banks that hold your operating account and can easily open CD’s on your behalf using the Arbitrage programs which place CD’s in institutions all over the US (spreading the FDIC protection to all accounts).

Please contact our office if you would like to see an interest rate sheet or would like our assistance in CD placement. Happy investing!

Need a Break?

Join us for CAI’s Ladies Tea!

April 29th is the 4th Annual Ladies Tea Event for the Bay Area and Central California Chapter of CAI (Community Association’s Institute). The first two ladies to send an e-mail to stacied@condofinancial.com will be our guests. The event is 1:30-4pm at the Roundhill Country Club in Alamo. You can always register to attend if you are not one of the first two people to respond. This is a fantastic event to just unwind and have a relaxing afternoon off!