Portfolios must change over time to reflect an investor's needs and goals, but selecting, rebalancing and keeping up the proper mix of investments can be time-consuming and confusing for many individuals. Asset allocation funds aim to accomplish the dual goals of creating diversification and meeting growth or income needs in one fund.

But, as with any investment, these aren't meant to be put on autopilot. Investors still have to watch the performance of the fund, even if the portfolio was constructed to meet risk tolerance or a target retirement date.

There are several different types of asset allocation mutual funds, but the most common are referred to as life-cycle funds and lifestyle funds:

● Life-Cycle: Created with a future date in mind, the portfolio rebalances to become more conservative as the investor gets closer to the target date.
Lifestyle: A portfolio of cash, stocks and bonds that remains fixed and is designed to meet the risk tolerance of the investor.

● Life-Cycle: Target Date Funds

Life-cycle funds are created with a specific future date in mind, such as retirement. "For example, a 2030 target date would mean the investor expects to retire in that year," says Kevin Morris, director of

LOS ANGELES (Reuters) - Starbucks Corp said on Wednesday it would slash U.S. coffee store openings through 2011 to cut costs in the face of weak U.S. sales and to focus more on growth abroad.

The company, which warned last week of the worst economic environment in its history, said U.S. customer visits had slowed but estimated growth in international business profit margins over the next few years.

Investors and analysts have been pushing for Starbucks to cut plans for U.S. expansion.

"It's not really surprising that they've slowed their store growth. The fact that they are making plans to slow it is certainly better than what they were telling us before," said John Langston, an analyst at Hodges Capital Management.

On Wednesday, the coffee shop chain posted fiscal second-quarter net income of $108.7 million, or 15 cents per share, compared with $150.8 million, or 19 cents per share, a year earlier.

Results from the most recent quarter included restructuring-related charges of about 3 cents per share.

Prior to its warning last week, analysts had been looking for a second-quarter profit of 21 cents per share. The results matched lowered estimates, according to Reuters Estimates.

Total revenue rose 12 percent to $2.53 billion. The company said revenue was lower than expected due

WASHINGTON (AP) -- The bruised economy limped through the first quarter, growing at just a 0.6 percent pace as housing and credit problems forced people and businesses alike to hunker down.

The country's economic growth during January through March was the same as in the final three months of last year, the Commerce Department reported Wednesday. The statistic did not meet what economists consider a definition of a recession -- which is a contraction of the economy. This means that although the economy is stuck in a rut, it is still managing to grow, even if slightly.

Many analysts were predicting the gross domestic product (GDP) would weaken a bit more -- to a pace of just 0.5 percent -- in the first quarter. Earlier this year, some thought the economy would actually lurch into reverse during the opening quarter. Now, they say they believe that will likely happen during the current April-to-June period.

"The economy is weak but not collapsing," said Lynn Reaser, chief economist at Bank of America's Investment Strategies Group. "A recession can't be ruled out, although the stars are not lined up at this point to definitively say one way or the other."

On Wall Street, the Dow Jones industrials closed down 11.81 points.

Gross domestic product measures the value of all goods and services produced within the United States

WASHINGTON (AP) -- Scrambling to shore up the faltering economy, the Federal Reserve cut interest rates to the lowest point in nearly four years Wednesday as the nation teetered on the edge of recession.

Wall Street rallied at first but then pulled back, concerned that the reduction might be the last for a while.

In fact, the Fed's trim was smaller than those of recent months amid indications the central bank might pause to see if months of powerful rate-cutting medicine and billions of dollars in stimulus checks will be enough to lift the country out of its slump.

Chairman Ben Bernanke led a divided Fed, in an 8-2 vote, in slicing its key rate by one-quarter percentage point to 2 percent.

In turn, the prime lending rate for millions of consumers and businesses fell by a corresponding amount, to 5 percent. The prime rate applies to certain credit cards, home equity lines of credit and other loans. Both rates are the lowest since late 2004.

The Federal Reserve, which has been dropping rates since last September, turned much more forceful early this year when housing, credit and financial problems worsened. Rate reductions in January and March alone marked the most aggressive intervention in a quarter-century in an effort to re-energize consumers and businesses.

"The substantial easing of monetary policy to date ... should help to promote moderate growth over time

Don’t lose faith in your planner just because he keeps you invested in a down market. Ask yourself these questions first.

Question: I saw many signs in 2007 that indicated that this would be a tough year in the market. But when I mentioned my concerns to my adviser, he resisted my suggestion to move into more conservative investments. His recommendation has cost me a lot of money, so I’m wondering: Should I stick with an adviser who only seems to have a pat answer of buy and hold? Shouldn’t he be managing my investments and giving me advice based on market conditions? –Rod G., Lexington, Ohio

Answer: First, let me say that it’s not at all clear to me that your adviser has done anything wrong. Frankly, I’m more suspicious when advisers are eager to dump existing investments and buy into new ones. After all, making more buy and sell recommendations is usually in the adviser’s financial interest, since more moves can generate more commissions, or at least make it appear that the adviser is on top of the situation.

So the fact that your adviser didn’t play yes-man to your urge to move into more conservative investments doesn’t automatically suggest to me that he’s incompetent or lazy. Quite the opposite. As long as you were going into 2008 with a reasonably diversified portfolio that made sense given your particular situation, then it seems reasonable to me that he would want to caution you against making any big moves.

That’s not to say that an adviser shouldn’t be ready to re-evaluate a strategy in light of market

LOS ANGELES (AP) -- Countrywide Financial Corp. said Tuesday it lost $893 million in the first quarter, as rising loan defaults amid a deepening housing downturn forced the nation's largest mortgage lender and servicer to sharply increase its provision for loan losses and book other credit-related charges.

The latest results marked the third consecutive quarterly loss for Countrywide, which reaped a windfall during the housing boom but has been struggling since last summer, despite predictions last fall by CEO Angelo Mozilo that his company would turn a profit in 2008.

The Calabasas, Calif.-based company, which agreed in January to sell itself to Bank of America Corp. for about $4 billion in stock, did not conduct an earnings conference call with analysts, citing the proposed sale.

The company said its loss amounted to $1.60 per share for the quarter ended March 31. A year earlier, it earned $434 million, or 72 cents per share.

Revenue plunged 72 percent to $679 million from $2.4 billion in the year-ago quarter.

Analysts polled by Thomson Financial, on average, forecast earnings of 2 cents per share on sales of $1.5 billion.

Countrywide shares rose 2 cents, less than a percent, to $5.85 Tuesday after falling as low as $5.63

Buffett says he 'got a call' about Bear Stearns, but bailing out the investment bank with only two days for due diligence, he says, 'took some guts that I didn't want to match.'

(Fortune Magazine) -- If Berkshire Hathaway's annual meeting, scheduled for May 3 this year, is known as the Woodstock of Capitalism, then perhaps this is the equivalent of Bob Dylan playing a private show in his own house: Some 15 times a year Berkshire CEO Warren Buffett invites a group of business students for an intensive day of learning. The students tour one or two of the company's businesses and then proceed to Berkshire (BRKA, Fortune 500) headquarters in downtown Omaha, where Buffett opens the floor to two hours of questions and answers. Later everyone repairs to one of his favorite restaurants, where he treats them to lunch and root beer floats. Finally, each student gets the chance to pose for a photo with Buffett.

In early April the megabillionaire hosted 150 students from the University of Pennsylvania's Wharton School (which Buffett attended) and offered Fortune the rare opportunity to sit in as he expounded on everything from the Bear Stearns (BSC, Fortune 500) bailout to the prognosis for the economy to whether he'd rather be CEO of GE (GE, Fortune 500) - or a paperboy. What follows are edited excerpts from his question-and-answer session with the students, his lunchtime chat with the Whartonites over

CHICAGO (AP) -- The Oracle of Omaha is betting that the country's candy jar is recession-proof.

With financing from Warren Buffett, candy maker Mars Inc. on Monday said it is buying confectioner Wm. Wrigley Jr. Co. for an estimated $23 billion in cash. The deal would marry brands that sweet-toothed Americans have munched on for decades: Mars owns Snickers and M&Ms; Wrigley's gum brands include Juicy Fruit, Orbit, Extra and Big Red.

"A good time to buy a really great business is when you can do it," Warren Buffett said on CNBC Monday, adding that he understands Mars and Wrigley better than the balance sheets of most major banks.

Buffett's Berkshire Hathaway Inc. will purchase a $2.1 billion minority equity interest in the Wrigley subsidiary once the deal is completed. The Omaha, Neb.-based company also offered $4.4 billion of subordinated debt to fund the deal.

"In terms of Warren Buffett's sweet spot, these are exactly the kind of brands that he wants," said Jet Hollander, a former candy industry executive who is president of the snack food consulting firm Pre-Eminence Strategy Group.

If the buyout receives regulatory and shareholder approval, the combined companies would leapfrog over Britain's Cadbury Schweppes as the world's largest confection maker -- a move that's already fueling

If you've been in the same industry for decades, changing careers might seem daunting. But, for many recovering executives, nonprofits, career coaching or making a clean break are all real options.

Golfing and gardening aren't as enticing as they once were. While baby boomers are increasingly becoming eligible for Social Security benefits, so far it seems that few are actually putting their working lives to bed. According to an AARP survey, 79% of baby boomers plan to work in some capacity into their retirement years.

But not all fiftysomething executives want to stay in the jobs, or industries, they spent most of their careers. Many are opting to step back from the long hours and stress of managerial roles in their golden years in favor of new and less time-consuming jobs.

A decade ago, Arnie Cogan, 64, exchanged a suit and tie, and a pay package that topped $300,000 a year, for a flight attendant uniform and starting salary of about $20,000 a year at Southwest Airlines. He now works as an in-flight supervisor for the company at its Phoenix airport. "It's been the best job that I've ever had," says Mr. Cogan, who previously worked as vice president of a graphic arts supply company. In his vice president role, Mr. Cogan worked 60 hours a week and frequently attended dinner meetings. As a flight attendant he worked 30 hours a week, and in his new role he works 40 hours a week. For seasoned executives like Mr. Cogan, a slower lifestyle and less stress can trump a big

The headline here isn't newsworthy. We know Warren Buffett is a better investor than the rest of us. His incredible long-term track record at Berkshire Hathaway, and his avoidance of both the 2000 tech meltdown and the current subprime crisis, prove that.

The question is: Why?

And, perhaps, "how?"
There's one person in this world well-equipped to answer that question: Buffett's longtime friend and business partner Charlie Munger. Happily for us, Charlie likes to talk -- and he addressed this very question last year.

Munger's remarks at last year's Wesco Financial annual meeting are wide-ranging and worth reading in their entirety. But boiled down, Munger gave seven reasons why Buffett is a better investor than you:

1. He's smart, and he puts his intelligence to good use.

2. He has an unflagging interest in investing.

3. He started learning about investing early, when he was 10.

4. He's a "good learning machine," and he keeps on learning.

5. He has enormous experience in the subject and practices daily.

Three steps to take now to ensure you enjoy all that free time in retirement

When you quit working, every day becomes a vacation day. How will you find fulfillment then?

In their book "Don't Retire, Rewire!" Rick Miners and Jeri Sedlar, professional transition coaches, offer three ideas on how to prepare for all the free time that opens up when you leave work behind.

Seek Alternatives

One way to start planning for that moment, Miners and Sedlar say, is to assess the extent to which your business and pleasure activities overlap. One of the first things people realize when they retire is how much their leisure was blended with work. Business entertaining and travel often meet people's needs for fun and recreation, as do company picnics and other company functions. You'll have to find ways to replace business-sponsored leisure when you retire.

Identify Your Passions

Another way to think about how you're going to use your obligation-free days when you quit working is to analyze your leisure activities now. Use a two-week timeframe to take a holistic view of your life, including things that don't come up often in your schedule and that might become the basis of something you'd like to expand on in your rewired

DEARBORN, Mich. (AP) -- Despite a surprise profit of $100 million for the first quarter, Ford Motor Co. said Thursday that it still expects to lose money this year as the U.S. auto market deteriorates.

But the company's stock surged nearly 12 percent as CEO Alan Mulally reiterated his promise that restructuring will return Ford to black ink for 2009.

The profit, Ford's first since the second quarter of last year, came even during a time when concerns about the U.S. economy kept many car buyers away from showrooms. Ford sales were off about 9 percent for the quarter, and the trend away from trucks and sport utility vehicles accelerated, hurting its bottom line.

Yet Ford said it earned money anyway because of strong profits in Europe and South America, manufacturing cost reductions and successful hedging on commodity price increases.

"The underlying business is improving," Mulally said in a conference call with industry analysts and reporters. "We remain cautiously optimistic despite the external difficulties."

But the question that has dogged Ford for years remains: Does the company, which lost $2.7 billion last year and mortgaged its assets to stay in business, have time to finish restructuring before it runs out of

SEATTLE (AP) -- Microsoft Corp. said Thursday its fiscal third-quarter profit fell 11 percent from a year earlier, when the software maker reported more than $1 billion in deferred revenue tied to delays in the launch of the Windows Vista operating system.

The earnings report didn't affect the software maker's stance on its bid to buy Web portal Yahoo Inc.

In a conference call, Chief Financial Officer Chris Liddell broke from the standard discussion of results to say Microsoft is prepared to go hostile or walk away from its offer if Yahoo doesn't agree to a deal by this weekend.

Microsoft said its net profit for the three months ended March 31 fell to $4.39 billion, or 47 cents per share, from $4.93 billion, or 50 cents per share, in the same period last year.

The results still beat Wall Street's expectations. Analysts surveyed by Thomson Financial forecast a profit of 44 cents per share.

But investors, chewing over the company's guidance and a drop in sales in the divisions that produce

It could be that managers and workers have a different take on what it means to be a top performer, and so they disagree on who should get the corporate spoils.

Most workers think that if they know what their job is and do it well, hitting all their goals on time and within budget, then they're doing a good job and deserve to have raises and bonuses heaped upon them. That would be true in a pure meritocracy. But in the real world, the politics of compensation are not that simple. Here are five keys to increasing your salary and benefits:

1. The boss's priorities rule

From the boss's perch, the biggest raises and plumpest perks go to the people he values the most and doesn't want to lose. These are the people who help him to get things done, meet his goals, and generally look good. In short, your performance and the raise it garners are less about you and all about him.

This is why leadership expert Rebecca Shambaugh, author of It's Not the Glass Ceiling, It's the Sticky Floor, says that your campaign for a bigger raise starts with finding out what your boss values. Talk to him about it both formally and informally. And talk to people who know the important things happening at your company and your boss's role in them.

"Executives value people who fit in well with them and with the team, who understand the culture and can help them get the results they want," she says. "So find out what's on the top of your boss's mind, and

SEATTLE (AP) -- Web retailer Amazon.com Inc. said Wednesday that its first-quarter profit rose 29 percent, helped by solid sales in the U.S. and abroad.

But a variety of factors, including slower growth in U.S. sales, international margin troubles and lower guidance for the full fiscal year pushed shares down $4.25, or 5.2 percent, to $76.75 in after-hours trading. The stock had closed up $1.40 at $81.

Quarterly earnings climbed to $143 million, or 34 cents per share, from $111 million, or 26 cents per share, in the same period last year.

Those results beat Wall Street's expectations. Analysts surveyed by Thomson Financial had forecast a profit of 32 cents per share.

Revenue increased 37 percent to $4.14 billion from $3.02 billion in the year-ago quarter.

Sales in North America rose 31 percent to $2.13 billion from a year ago. International sales grew 44 percent to $2.01 billion, and accounted for 49 percent of total revenue, up from 46 percent last year.

Chief Financial Officer Tom Szkutak said in a conference call Wednesday that he did not see evidence in Amazon's results that U.S. shoppers had changed their buying behavior, despite widespread concern