In Brief: Nov. 22, 1999

BONDS ON THE RISE Interest rates on savings bonds, the ultimate safe investment, were recently reset. Series EE savings bonds issued after May 1997 are now earning 5.19% interest, up from the 4.31% they were earning in May. The Treasury Department just unveiled an online purchasing program at WWW.SAVINGSBONDS.GOV. You can purchase the bonds with either a MasterCard or Visa. Careful. You will pay more in interest on the cards than you will earn on the bonds if you carry a balance.

EE SAVINGS BONDS The rates of the series EE savings bonds since May '97

In percents

May '97 5.68 Nov. '97 5.59 May '98 5.06 Nov. '98 4.60 May '99 4.31 Nov. '99 5.19

Source: Department of the Treasury

ANNUITY DOUBLE-DIPPING One of the selling points of annuities is that they are tax-deferred products. So companies like life insurers that sell annuities within tax-deferred, retirement accounts such as 401(k)s or IRAs aren't offering added value, just added profits. Bring on the lawyers. Insurance companies "shouldn't be marketing deferred annuities for placement in retirement plans," says Michael Spencer, partner at Milberg Weiss Bershad Hynes & Lerach, which has filed class actions against four big annuity sellers. "The consumer ends up paying substantially higher fees than if they bought a nonannuity investment."

THE ATM WAR Legislators in several cities, angered by rising ATM fees, have simply outlawed them. But last week the banks struck back. Wells Fargo and Bank of America began barring noncustomers from using their ATMs in Santa Monica, Calif., after the city council banned surcharges. San Francisco residents may soon be facing the same fate. "The banks have a right to earn a return on their investment," argues Joseph Morford, a banking analyst for Dain Rauscher Wessels in San Francisco. The machines cost up to $50,000 each. But consumers now appear to be lowering their own costs by cutting back on trips to the ATM. Amortize that.

--By Aixa M. Pascual