10 Places to Put $10,000 Wanna put 10 grand to work? We've got 10 terrific investments--plus investments alternatives for when you're inclined to spend. Check out the goodies.
By Aravind Adiga; Marion Asnes; Jon Birger; Joan Caplin; Peter Carbonara; Adrienne Carter; Jean Sherman Chatzky; Brian L. Clark; Borzou Daragahi; Amy Feldman; Erica Garcia; Leslie Haggin Geary; Jon Gertner; Lisa Gibbs; Laura Lallos; Jeff Nash; Nick Pachetti; Sridhar Pappu; Ilana Polyak; Suzanne Woolley

(MONEY Magazine) – INVESTMENTS

There are thousands of places to put 100 Benjamins (as in Franklin, the mug on the C-note). MONEY's staff investigated scores of them before winnowing the most promising ideas to the 10 stocks and funds that follow. Consider them our best long-term picks for folks who prefer their investments healthy, wealthy and wise.

Think you have an even better idea? Share it with MONEY.COM, where you can enter a contest to win $10,000. Ben would've approved. See page 72 for details.

1 APPLIED MATERIALS A BUY-AND-HOLD TECH STOCK, IT'S THE WORLD'S NO. 1 MAKER OF EQUIPMENT FOR CHIP MANUFACTURERS.

Consider your ideal cyclical stock: a steelmaker, perhaps, or a paper company. Predictable earnings growth. Dominant market position. But modest profit margins. Not much more in the way of bragging rights.

Now take your ideal tech company. Sexy earnings potential. Thigh-high margins. But--yeesh--a stock price that's all over the place.

Buying shares of Applied Materials offers you the best of both worlds. The Santa Clara, Calif.-based company, selling at a recent $57.52 a share, makes the machines that make semiconductor chips. It generated 51% gross margins last year. And yet it's in a deep funk these days. In fact, new orders for equipment have tumbled the past two quarters. Shares are down nearly 30% from a year ago.

So why invest $10,000 in Applied Materials now? Because it's No. 1 in almost every step of the chipmaking process, which means that whether the chips are for PCs or phones, made by Intel or AMD, the equipment used to create them will likely be Applied's. There's also gobs of cash on hand ($4 billion, at last count), and CEO James Morgan has steered his company through six downturns over 24 years, consistently emerging with more market share. In other words, now is a great buying opportunity. Most analysts agree that we're nearing the capital-spending trough. If past semiconductor crashes are any indication, the bottom could happen around August or September. When the cycle turns, this stock will rocket. --NICK PACHETTI

VITALS Ticker: AMAT Price: $57.52 52-week range: $34.13 to $98.50 2001 P/E: 54 Market cap: $46.5 billion

MATERIALS' WORLD Applied Materials has been grabbing a bigger and bigger share of a growing market for equipment to produce semiconductor chips.

1997 2000

AMAT's share 18% 25% Total market size $20.4 billion $33.2 billion

Source: Gartner Dataquest.

2 EUROPACIFIC GROWTH AN OVERSEAS FUND IN ALL THE RIGHT PLACES

Europe has been touted as the next hot investing thing for, oh, the past five years. So why start listening now? The numbers: The E.U. economy grew 0.5 percentage points faster than ours in the last half of 2000. While analysts predict that earnings for the S&P 500 will flatline this year, the equivalent European index could see 7% growth.

One mutual fund poised to reap the rewards: EuroPacific Growth, part of the highly regarded American Funds Group and the No. 1 performer among overseas funds for the past 15 years (which makes the 5.75% load easier to swallow). We're big fans of the eight co-managers, who mean it when they say they're buy-and-hold folks: They keep stocks an average of four years, compared with just 15 months for the typical international offering.

With 43% of its $29 billion in assets now invested in Europe, this fund has been buying more banks and drugmakers, like the Dutch financial conglomerate ABN AMRO and the British pharmaceutical giant AstraZeneca. Yet it maintains positions throughout the world, which dampens risk. True, the fund suffered an 18% drop last year. But as co-manager Rob Lovelace notes: "We're never going to dart in and out of positions--we ride them through. That tends to be painful at the outset but great long term." --ADRIENNE CARTER

VITALS 2001 return: -0.9% (AS OF MAY 21) Annualized three-year return: 8.5% Telephone: 800-421-0180

3 EXXONMOBIL AN ENERGY GIANT WITH THE MUSCLE--AND THE SMARTS--TO DELIVER TOP GAINS FOR A VERY LONG TIME TO COME

Fed up with soaring gasoline prices? You wouldn't be if you owned ExxonMobil. The world's largest energy company more than doubled its profits last year while rewarding shareholders with a 10% total return compared with a 9% loss for the S&P 500. Not only did ExxonMobil's $17.7 billion in net income in 2000 smash the record for annual profits held by a public company, it surpassed the profits of Wal-Mart, IBM and Boeing combined. And there's been little let-up in 2001, as first-quarter earnings climbed 51%.

ExxonMobil's fortunes will always be linked to the ever-unpredictable price of oil, of course, and that means its stay atop the profit heap could be brief. But our enthusiasm doesn't hinge upon gas prices. Rather, this is fundamentally a strong company that can provide shareholders with solid returns in normal times and outsize ones whenever there's a spike in energy prices.

Helping the stock is the fact that the regulatory environment for Big Oil is the best it's been in years. With former oilmen running the White House, ExxonMobil should have a much easier time fending off environmental challenges to its drilling and refining ventures. Moreover, among its peers, ExxonMobil is the best positioned to weather any downturn in crude oil prices, says analyst Tyler Dann of Bank of America Securities. His bullishness is based largely on ExxonMobil's internal diversity: While lower prices would almost certainly depress earnings at the company's oil exploration and production units, its chemicals division would benefit from cheaper petroleum-based raw materials. Also benefiting would be ExxonMobil's 45,000 gas stations, which profit from the fact that retail fuel prices decline more gradually than wholesale ones.

Another positive is a management team, headed by CEO Lee Raymond, that runs a tight ship at a company still notorious for a leaky one off the coast of Alaska a few years back. Created in 1999 by the union of Exxon and Mobil, ExxonMobil expects to wring out $7 billion in merger-related cost savings by 2002. That's 50% more than the company was predicting just last August. Meantime, ExxonMobil is relying on 3-D imaging of seismic data and other advanced technologies to cut the cost of oil exploration: Last year it spent 65[cents] a barrel finding oil, down from $1.20 a barrel in 1999. "It's not the technology companies that benefit most from new technology, it's the non-tech companies using new technology," says Dreyfus portfolio manager Timothy Ghriskey, who counts ExxonMobil as a top five holding in both his Aggressive Value and his Premier Value funds.

Technology is only one reason why Ghriskey considers ExxonMobil the premier name in the energy business. Another is the heft ExxonMobil's share price and profits give it as a potential acquirer. Right now, the only thing ExxonMobil is buying is its own stock, but further consolidation in the energy sector is considered likely. With billions piling up in ExxonMobil's coffers, it's only a matter of time before the tiger starts prowling for earnings-enhancing deals. --JON BIRGER

VITALS Ticker: XOM Price: $88.75 52-week range: $75.13 to $95.43 2001 P/E 18.7 Market cap: $308.5 billion

4 LONGLEAF PARTNERS MUTUAL FUND INVESTORS CAN'T BUY WARREN BUFFETT. BUT THAT'S OKAY: THESE GUYS MAY BE EVEN BETTER.

We love Longleaf. Two of the company's four mutual funds--the flagship Longleaf Partners and Longleaf Partners Realty--have berths in the MONEY 100. And late last year we recommended the still-young Longleaf Partners International as one of our 10 favorite investments for 2001. (So far, so good: The overseas offering is up 14% through May 21.) Longleaf Partners Small Cap no doubt would make one of our shortlists too--were it not closed to new investors.

What's to love? Great, old-fashioned stock picking. Led by senior partner O. Mason Hawkins and G. Staley Cates, Longleaf's fund managers sift through battered stocks that are trading at less than 60% of what they calculate the assets of the company to be worth. Then they stick with concentrated portfolios of their best finds--a mere 20 or so companies for Longleaf Partners. The fund's 18% annualized 10-year return places Partners among the top 20% of all midcap value offerings.

There's just one catch: Longleaf has long demanded a $10,000 minimum investment, even for IRA and automatic investing accounts. But hey--that's not a problem with this story! (Actually, if you don't really have that much cash, you can sneak in for less through Fidelity, Schwab and some other discount brokers, but you will have to pay an extra charge.)

Any investor in Longleaf Partners should understand that its deep-value style and its highly concentrated portfolio can produce a few dry spells. Consider 1999. Weighed down by garbage hauler Waste Management, the fund eked out an embarrassing 2% return during that year's tech-stock frenzy. But Waste Management has proved a keeper. It rebounded 62% in 2000, helping Partners earn 21% last year in a miserable market. Other longtime holdings, like Tricon Global and Marriott International, each up more than 35% over the past year, continue to pull their weight. So far this year, Longleaf Partners is well on its way to Hawkins' and Cates' goal of 10%- a-year returns plus inflation: The fund already was up 11% near the end of May. --LAURA LALLOS

VITALS 2001 return: 10.7% (AS OF MAY 21) Annualized three-year return: 10.2% Telephone: 800-445-9469

5 WAL-MART IT'S A CORE HOLDING IN ANY LONG-TERM PORTFOLIO. HAPPILY, NOW IS A GOOD TIME TO BUY IT.

Behind Wal-Mart's smiley face is the biggest, baddest, most ruthlessly efficient retailing machine on earth.

THE BIGGEST. More than 100 million customers visit its 4,250 stores each week, buying nearly $200 billion worth of stuff annually. That's easily five times the amount purchased at rival K Mart. And now that Wal-Mart sells food at nearly 1,000 supercenters, it recently passed Kroger to become the nation's No. 1 grocer.

THE BADDEST. As in coolest. Bentonville, Ark.-based Wal-Mart boasts a computer system second only to the Pentagon's in terabytes. Store managers carry handheld gizmos that can scan every product in every aisle. The result: a company that knows precisely what sells and what doesn't in nine countries. It's a data gold mine that helps Wal-Mart stay ahead of everyone else.

THE MOST RUTHLESSLY EFFICIENT. Wal-Mart's retailing business is classic high volumes, low margins: Prices drive sales, and more volume lets you cut prices. That means it has got to run like a machine. Not only does all that data help Wal-Mart manage existing inventory, it also (when coupled with the company's tremendous size) gives Wal-Mart unprecedented clout in negotiations with suppliers, even big ones like Procter & Gamble. Other chains might hesitate to compete against suppliers with their own higher-margin private-label goods. Not Wal-Mart. One result: Sales per square foot in its supercenters surpass $400--about 30% higher than those of Super K Mart.

Wal-Mart stock is rarely cheap. But it should be considered a core holding in any long-term portfolio. Over the past 15 years, Wal-Mart shares have soared 2,002%, more than four times the increase of the S&P 500 and far ahead of stalwarts like General Electric. With the stock at $53.20, down 24% from its peak, it's as good a time to buy as any. At 30 times estimated 2002 earnings, shares trade at a discount to a historic forward P/E of 33. --AMY FELDMAN

VITALS Ticker: WMT Price: $53.20 52-week range: $41.44 to $62.94 2001 P/E: 33.7 Market cap: $232.6 billion

6 MERRILL LYNCH "HOLDERS" A BASKET OF STOCKS THAT DOESN'T CHANGE. WHO WOULD WANT IT TO?

Get 50 classic growth stocks for the price of just one trade. That's one of the attractions of Merrill Lynch's Market 2000+ HOLDRS. This collection of global companies trades under the ticker symbol MKH on the American Stock Exchange. It's a growth lover's portfolio, stuffed with blue-chip supercaps from Microsoft and Eli Lilly to General Electric and Cisco. These may not be the fastest-growing companies around the world, but they would form the bedrock of a stock portfolio that's in it for the long haul.

And there's more. Market 2000+ is like an exchange-traded fund (ETF) with a distinctive twist. ETFs work like mutual funds--they adjust their portfolios, make trades, generate taxable-gains distributions. But Holders (as these Merrill products are commonly called) are fixed baskets of stocks. Most focus narrowly on sectors such as biotech or B2B Internet companies, but the version we've picked here delivers broad diversification. (Market 2000+ started out in 2000 with 50 stocks but today totals 52: AOL and Time Warner have merged, while EMC, Lucent and Novartis have had spin-offs.)

Best of all, unlike with conventional mutual funds or ETFs, you own the underlying shares themselves--for a modest $10 fee you can swap a 100-share round lot of MKH for the individual stocks, and then tinker with them. A round lot includes three shares of Citigroup, four of Nokia and so on. If you need to raise cash, you can pick and choose which stocks to sell, using the cost-basis calculator at www.holdrs.com to keep taxes down. Or if you sour on one of the companies completely, you can sell it while keeping the rest. Because of that nifty conversion feature, Holders must be bought 100 shares at a time. In mid-May, MKH traded for $73 a share, so you don't even need a full $10,000 for a round lot. Put up $14,600, and you can own two round lots. --L.L.

VITALS Ticker: MKH Price: $73.46 52-week range: $61.15 to $97.31 Weighted trailing 12-month P/E: 34.7

THE 52 COMPANIES IN THIS FUND AIG - AOL TIME WARNER - ASTRAZENECA - AT&T - AVAYA - BELLSOUTH - BP - BRISTOL-MYERS SQUIBB - BRITISH TELECOM - CISCO - CITIGROUP - COCA-COLA - DELL - DEUTSCHE TELEKOM EMC - ERICSSON - EXXONMOBIL - FRANCE TELECOM - GENERAL ELECTRIC - GLAXOSMITHKLINE - HEWLETT-PACKARD - HOME DEPOT - IBM - INTEL - JDS UNIPHASE - JOHNSON & JOHNSON - ELI LILLY - LUCENT - MCDATA - MERCK - MICROSOFT - MORGAN STANLEY - NIPPON TELEGRAPH & TELEPHONE - NOKIA - NORTEL - NOVARTIS - ORACLE - PFIZER - QWEST - ROYAL DUTCH PETROLEUM - SBC COMMUNICATIONS - SONY - SUN MICROSYSTEMS - SYNGENTA - TEXAS INSTRUMENTS - TOTALFINA - TOYOTA - VERIZON - VIACOM - VODAFONE - WAL-MART - WORLDCOM

7 PFIZER PRESCRIPTION DRUGS HAVE BECOME CONSUMER STAPLES. WITH DEMAND ASSURED, THE GROWTH POTENTIAL REMAINS ENORMOUS.

Given our overflowing medical cabinets--Americans last year filled 2.9 billion prescriptions, up from 1.9 billion in 1992--it's no surprise that inventing drugs is an incredibly lucrative business. In the past five years, drugmakers' sales rose an average of 10% annually while profits jumped 16%. And the buzz is expected to last for quite some time: Researchers predict that prescription-drug spending will hit $366 billion in 2010, nearly triple last year's $132 billion.

Our favorite way to take advantage of this trend right now is Pfizer, the big drugmaker that's promising average earnings growth of 25% a year for the next three years. The stock has been the kind of steady producer that investors love, returning an average annualized 27% the past decade. No wonder 103 mutual funds counted Pfizer as their top holding at the end of April (and it is a top five holding for 413 more).

On the surface, Pfizer looks expensive because its price/earnings ratio of 33 is the highest among major drugmakers. However, Pfizer also has the fastest earnings growth. So on a price/earnings-to-growth (or PEG) basis, Pfizer actually turns out to be the cheapest. Its 1.2 PEG ratio compares favorably with Merck's 2.3 and American Home Products' 2.0.

The reason for this discount: Pharma investors are worried that too much of Pfizer's earnings juice is due more to cost cuts from last year's merger with Warner-Lambert than to new blockbuster products. Plus, some of the company's existing juggernauts, most notably the cholesterol-reducer Lipitor, face growing competition.

We think these worries are overblown. Pfizer has a power portfolio that includes eight drugs with sales of more than $1 billion a year. Of all the major drugmakers, it faces the fewest challenges from patent expirations and generic competitors. And the company's marketing prowess is renowned. As chief executive Hank McKinnell recently told MONEY (CEO Speaks, June), Pfizer has plenty of room to grow its blockbuster drugs by launching them in new countries, adding new dosage amounts and finding new conditions that the drugs can treat effectively. We're confident he can keep the pills popping. --LISA GIBBS

VITALS Ticker: PFE Price: $44.76 52-week range: $34.10 to $49.25 2001 P/E: 34.4 Market cap: $282.3 billion

THE DRUG OF CHOICE Pfizer is significantly cheaper than most of its peers when measured by price/earnings-to-growth ratios. It also has more blockbuster drugs and spends big bucks on research and development.

STOCK PEG RATIO BLOCKBUSTERS[1] R&D[2]

American Home Products 2.0 2 13% Eli Lilly 4.7 3 18 Merck 2.3 4 6 Pfizer 1.2 8 15 Pharmacia 1.4 1 15

Notes: Data as of May 21. [1]Defined as drugs with sales over $1 billion in 2000. [2]As a percentage of 2000 revenue. Sources: Baseline, companies.

8 DAVIS FINANCIAL WANT TO MAKE A LOT OF MONEY? BET ON THE BUSINESS OF MONEY.

Sure, financial stocks cleaned up last decade: Posting earnings growth of 16% annually (vs. 12% for the S&P 500), the sector delivered a 435% total return. But if Wall Street's prognosticators are right, the '90s were a warm-up. With aging baby boomers desperate for financial help--from portfolio management to estate planning--banks, brokers, insurers and others will keep reaping big profits.

How best to take advantage? Rather than bet on a single company, we'd invest in a spectrum of financial businesses via a sector fund. Our favorite: Davis Financial, and not just because it has the best five-year annualized return (22%) among diversified financial funds tracked by Morningstar. Co-managers Christopher Davis and Kenneth Charles Feinberg hold just 40 or so blue-chip stocks. They look for a competitive edge in growing businesses (American Express with credit cards; Geico with low-cost insurance), lots of cash flow and beautiful balance sheets. "Success in financial services comes down to execution," adds Feinberg, "so we want managements with a proven record for creating wealth for shareholders." No wonder the fund has big stakes in Sandy Weill's Citigroup and Hank Greenberg's AIG. --JEFF NASH

VITALS 2001 return: 3.2% (AS OF MAY 21) Annualized three-year return: 11.7% Telephone: 800-279-0279

9 WASATCH SMALL CAP GROWTH THIS LITTLE WONDER HAS BEATEN 90% OF ITS PEERS FOR THE PAST 10 YEARS.

It's been easy to overlook the little guys. After all, the '90s were the megacap decade. But did you know that the small-cap Russell 2000 index outpaced the S&P 500 in the past two calendar years? That the former is up nearly 7% so far this year, while the latter is down 1%? That earnings have been growing faster at small companies (5% over the past 12 months) than at large companies (3%)? That many small-cap stocks still trade at historically low price/earnings and price/book ratios?

Regardless of what segment of the market outperforms going forward, a well-diversified portfolio should always have 10% to 15% of its money in small-caps, because when these companies move up they tend to do so quickly. That's why we're recommending the exceptionally nimble Wasatch Small Cap Growth, the flagship fund of Wasatch Advisors in Salt Lake City. For the 12 months ended May 21 it's up 34.7%, compared with the average small-cap growth fund's loss of 2.5%. And the Wasatch fund has surpassed nearly 90% of its long-term rivals with a 10-year annualized return of 16.9%.

Jeff Cardon, manager of Small Cap Growth since its inception in 1986, credits an investing discipline that avoids overvalued tech names and buys only those securities trading at P/E ratios not much higher than their growth rates. He also wants only businesses that are hard to duplicate and are at least 10%-owned by insiders.

We asked Cardon what he's been buying lately. Clothiers Christopher & Banks (CHBS) and Chico's (CHS) are both shoplifting market share from department stores by catering to women who are ignored by the bigger fashion franchises. (MONEY profiled Christopher & Banks, up an astonishing 8,800% in the past five years, in the June issue, calling it "The Best Stock You've Never Heard Of.") Both stocks trade at 22 times next year's estimated earnings, and Cardon expects both to increase earnings 30% annually for the next few years.

Another recent purchase is Manhattan Associates (MANH), which makes software that helps companies more efficiently manage product sales, inventories, distribution and so forth. MANH trades at about 40 times next year's earnings, which Cardon admits is expensive for him, but he sees earnings jumping 40% annually for the next few years. Still, Cardon says he is only nipping at Manhattan--and the rest of the tech sector. "I guess it's my way of saying I'm not convinced we've hit rock bottom," he explains.

Wasatch is a hot shop lately. Three of the five top-performing small-cap growth funds of the past 12 months are Wasatch offerings. And on the value front, Wasatch Small Cap Value boasts a 25.2% annualized three-year return that beats 99% of its peers. Small Cap Value recently had a "soft close," as the company calls it, restricting new investors because the fund's assets had zoomed to $400 million; once things settle, the fund should reopen, probably next year. When that happens, it'll make an excellent portfolio-balancing companion to Small Cap Growth. Meantime, don't wait too long to jump into the growth side: Wasatch plans to close Small Cap Growth after assets hit $800 million; in May the fund was at $700 million and climbing. --J.N.

VITALS 2001 return: 10.8% (AS OF MAY 21) Annualized three-year return: 22.0% Telephone: 800-551-1700

10 GANNETT ADVERTISING REVENUES ARE WAY DOWN. SO WHY WOULD ANYONE WANT TO BUY A NEWSPAPER STOCK? READ ALL ABOUT IT.

Good media stocks don't come cheap these days. AOL Time Warner (the parent company of MONEY) trades at a steep 47 times estimated 2001 earnings. Tribune Co., owner of the Chicago Tribune and the Los Angeles Times, a good two dozen television stations and one bad Chicago Cubs baseball franchise, sports a price-to-earnings ratio of 36.

But there's one sizable media company bucking the price trend: Gannett, whose 18.9 P/E is among the lowest of all major newspaper stocks. Throw in Gannett's long-term growth rate of 12%, and the stock looks like a rare media bargain.

A slowing economy has dragged down newspaper industry earnings 31% for the first quarter from record levels in 2000. Gannett hasn't been immune. It failed to meet analysts' first-quarter earnings expectations, in part because of a drop-off in help-wanted classifieds. The result: Gannett shares are down 18% from a two-year high of $83.

Douglas Eby of Torray funds, which own 2 million shares of Gannett, thinks the stock is a great buy at its current $68.57. With a market cap of $18.1 billion, Gannett is a true media biggie. It owns 22 TV stations, and its flagship newspaper, USA Today, has the largest circulation (nearly 2.3 million) of any daily paper in the country. It own 98 other dailies throughout the U.S. too, and though few of them threaten the New York Times on the Pulitzer Prize front, many have near-monopoly locks on their local markets in ways the Times couldn't hope to achieve on its own home turf. That's one reason Gannett's operating margins were 29% last year. How did competitors fare? Dow Jones, publisher of the Wall Street Journal, had operating margins of 23%; followed by Tribune Co., 21%; the New York Times Co., 18%; and the Washington Post Co., 14%.

Eby also credits CEO Douglas McCorkindale for investing in future growth: "He has shown a real flair for managing for cash flow and making smart acquisitions." One of Gannett's wisest buys was the 1999 purchase of Newsquest, a British chain whose holdings include 15 dailies. That overseas base has helped Gannett weather the current slowdown better than many rivals. With great margins, a good mix of assets and lots of cash on hand ($193 million at the end of 2000), Gannett should outshine its peers when the economy picks up--and shareholders should benefit from the good news. --ARAVIND ADIGA

VITALS Ticker: GCI Price: $68.57 52-week range: $48.38 to $70.02 2001 P/E 18.9 Market cap: $18.1 billion

BONDS

The Fed chose the stock market over the bond market when it cut rates five times in five months this year. That spurred investors to flee the relative safety of long-term Treasuries for richer options elsewhere. But there are still a few bright spots in bonds:

LOW-RISK I-BONDS: Inflation-adjusted bonds are backed by the U.S. Government and pay a fixed rate for up to 30 years--plus a fluctuating inflation premium that's set each May and November. (Few bonds give you that.) The fixed rate is now 3%, for an inflation-adjusted yield of 5.92%. The annual purchase limit is $30,000; buy them through www.savingsbonds.gov.

HIGHER-RISK JUNK: Investors dumped high-yield bonds in 2000 amid trouble at telecoms and more corporate defaults than usual. Even though the market has seen a run-up this year, led by energy, cable and cyclical companies, junk bonds still trade near their historical bottom, says Bruce Monrad, co-manager of Northeast Investors Trust, the top-performing high-yield fund for the past 10 years. It's up 6.1% through May 21 (800-225-6704). Another great fund is Pioneer High Yield (800-225-6292), whose manager, Margaret Patel, avoided telecoms when it really counted and recently hiked her stake in cyclicals. Her fund is up 13% year to date, and if she keeps it going, this will be her third year in the top 1% of high-yield funds. --ILANA POLYAK

CHARITY

Nothing beats the satisfaction of investing in charitable causes. There are endless ways to donate--and to make your gift keep growing.

DONOR-ADVISED FUNDS, run by many investment houses, are for clients who typically have $10,000 or more to contribute. Here's how it works: Deposit cash, stocks or other assets into a fund and claim an instant tax write-off for the full amount of your gift, within IRS limits. You choose how you want your donation invested and when the money is to be distributed to the charities of your choice. Fidelity's Charitable Gift Fund (800-682-4438; www.charitablegift.org) lets you in for $10,000, with a minimum of $1,000 for subsequent gifts. Annual fees range from 1.45% to 1.72% for balances up to $500,000. At Schwab's Fund for Charitable Giving (800-746-6216; www.schwabcharitable.org), similar fees run from 1.07% to 1.13%.

COMMUNITY FOUNDATIONS will invest your gift to grow over time too. And they generally have lower fees and minimum deposits than donor-advised funds do. They're best for those who want to do good in their region but aren't sure exactly which causes to help. For instance, the New York Community Trust (212-686-0010; www.nycommunity trust.org) reviews the works and finances of 8,500 charities before funding them; it lets donors choose which issues (say, the arts or kids) they want to support. There are more than 500 community foundations--from Homer, Alaska to Middlebury, Vt.--listed with the Council on Foundations (www.cflocate.org; 202-466-6512).

MICROLENDERS put your money to work by supporting business loans and other lending arrangements for poor people. Accion USA Loan Fund (www.accionusa.org; 617-492-4930) makes loans averaging $4,000 so that low-income entrepreneurs in the U.S. can start or expand businesses. Accion typically pays its investors 3.75% to 4.5% annually for $10,000 loans over three to five years. It also runs international programs, where loans in developing countries average a mere $550. For other programs here and abroad, go to www.calvertgroup.com/foundation. --L.H.G.

SPLURGES

How would you spend an extra $10,000?

You could give it to family, a friend, a stranger--the IRS allows you to transfer $10,000 a year to as many people as you wish without having to pay gift tax. Or you could lavish it on yourself, which, of course, is not the government's business--or anybody else's. Here's how some of us at MONEY might indulge ourselves.

PLAY BALL In the age of the $250 million shortstop, I can understand someone griping about the high cost of attending one baseball game, never mind 81. But if you're a diehard fan with an easy summer schedule, season tickets to your favorite major league team remain the best way to enjoy America's pastime.

I speak from experience. During my teenage years, my dad and I attended 40 or so Boston Red Sox games together every season. Rarely did we talk about anything other than baseball, but the father-son thing was undeniable. Almost as fun as the game: the running commentary by David Cavers and other season ticket holders assigned to Fenway's Box 13. We'd chew over the inning at hand as well as debate Sox history, such as who hit Fenway's longest home run. (My dad insists it was Hank Greenberg; everyone else, Ted Williams.) I can't tell you how sad it was to learn recently that Mr. Cavers had passed away.

Today, $10,000 will buy you four season tickets in Fenway's right field. If you're a fan of the Los Angeles Dodgers or Chicago White Sox, somewhat better right-field seats will set you back $8,000, leaving plenty of change for peanuts and Cracker Jack. --J.B.

MAKE AN INDIE FILM What do George Lucas, David Lynch and 14-year-old skateboarder Jordan Miller have in common? All have embraced the economics of digital filmmaking. Innovations in cameras and editing have brought the cost of making movies way down while jacking the quality way up. So much so that Lucas just shot the next Star Wars movie mostly in digital, and Miller produced two short films for this year's X-Dance film festival.

To start, you'll need a digital video camera like Sony's $4,000 DSR-PD 150, preferred by maestro Lynch. You'll want a Mac G4 and monitor ($4,000) to use Apple's hot $1,000 Final Cut Pro 2 editing program, but you can do similar editing and create special effects with Adobe's $550 Premiere on either a Mac or a cheaper PC. Video images hog space, so you'll need at least 60GB of hard drive and 256MB of RAM.

Got a grand or two left over? C'mon, Hitchcock: Buy your actors some food and drink. --BORZOU DARAGAHI

CHILL They say fine wine improves with time, but that's just half the story. To age gracefully, wine needs consistent temperatures (55[degrees]F is ideal) and humidity (65%) in a place free from light and vibrations. Think French cave--or the latest portable wine cellars.

The EuroCave Elite 3-Temp fridge holds up to 240 bottles in three climate-controlled zones for reds, whites and champagnes. It's around $5,400 (with delivery) at Wine Enthusiast. Call 800-356-8466. So what do you fill it with? Might as well start with legends like the 1990 Grand Vin de Chateau Latour; six bottles cost $3,825 at Sherry-Lehmann (212-838-7500). --LESLIE HAGGIN GEARY

YOUR OWN PRIVATE IDAHO Anyone living in a city like New York knows how it begins--on a crowded subway stuck deep underground, perhaps, or in a packed elevator. A decade after moving here, I still can't shake the occasional urge to drive as fast as possible toward somewhere without people, places or things. A look around the Web shows me that 10 grand can buy a sliver of undeveloped land in almost any state. But for a big hunk of nowhere, you've got to look far. Texas is too hot for me; Alaska too up there, if you know what I mean. Acreage in Montana and Wyoming has shot up in price.

Then there's North Dakota, one of the few regions in the U.S. systematically losing population. Consider Slope County, where 767 people live in an area about the size of Rhode Island. The land there--scenic and blank and unspoiled--goes for $250 an acre. "You may have to drive two hours down a gravel road to buy a screwdriver," warns local real estate broker Joe Frenzel. But I say that sounds like two hours well spent. --JON GERTNER

SCREEN GEM Prices on superskinny plasma-display TVs have been falling faster than a tech stock in January--making it easier than ever to be the ultimate couch potato. From my computer I found the Philips 42-inch Brilliance Plasma Display 42PW9932 for a rock-bottom $6,176 at www.monitoroutlet.com. It simply has the best picture out there.

As for sound, I'd have ear candy with Onkyo's THX-certified TX-DS787 receiver ($764 at www.crazyeddie.com) and Polk Audio's $1,200 RM7500, with five satellite speakers and a subwoofer (www.liquidprice.com). For flicks, I'd get Sony's DVP-C660 five-disk carousel DVD player ($330 at www.800.com). To download up to 60 hours of pay-per-view movies or network TV--and skip the commercials--I'd want Panasonic's ShowStopper Hard Disk Recorder with its "lifetime subscription" to ReplayTV, for $699 (minus a $100 rebate) at www.buy.com. Finally: a $999 La-Z-Boy Oasis recliner with an electronic massage mechanism, a cooler under one armrest and a phone beneath the other. The good news: I'm at $10,068. The bad: I'll still have to get up to hit the head. --BRIAN L. CLARK

BE THE BALL You may never sport a Masters jacket but you can buy a better golf swing--if you've got the right pro. For serious help, see Butch Harmon, who coaches Tiger Woods and Mark Calcavecchia. At Harmon's Las Vegas school, three days for up to eight duffers runs $4,800 per person. Steep, yes. Impersonal, no. Students get constant guidance from Harmon and four of his pros. A limo whisks you to morning clinics. Break for lunch at the Rio Secco Golf Club (designed by Rees Jones) before playing rounds with Harmon and pros. The tab includes four nights at the Rio All-Suite Hotel & Casino, a golf-club fitting and computerized video analysis of your swing. Take your best buddy and drop the change at the craps tables. But book now for 2002--Harmon's full up this year. Call 702-889-2444. --L.H.G.

BE AN ANGEL, WON'T YOU? Fewer than 10% of Broadway and off-Broadway shows return their investors' money; fewer still increase it. But the shows go on, which is why theater folk call stagestruck investors angels.

Individual backers typically invest through limited partnerships with $10,000 to $50,000 minimums. This means if the show's a flop, you can't lose more than you put in--and you can watch it crash from decent seats. If it's a smash? The last row of the last balcony cannot begin to describe how high profits can climb. Take The Producers. (You wish.) Its pre-production buzz was so loud, it attracted more investors than it had shares--ironically, the storyline of the show--and a lottery was held to divvy the last 200 shares at $10,000 apiece. By opening night, the hit returned 15% of the principal to its backers.

For plays looking for angels, check the weekly Theatrical Index. Call 212-586-6343 for subscriptions. --JOAN CAPLIN

DER HOT WHEELS This was the BMW that put Bimmers on the map in the States: the 2002, sold here from 1969 to 1976. Like other relics of its era--kung fu movies, Steven Tyler, Marimekko--the car is getting cooler even as it ages. "There's been a cult around the BMW 2002 almost since it was made," says vintage auto appraiser Dave Brownell. The 2002 was powerful and a real driver's car--it clung to curves like no American competitor could. Its boxy, androgynous design was totally fresh.

Look on the Web, and you'll find hundreds of 2002 owner clubs and bulletin boards linking enthusiasts around the world. It's relatively easy to track down parts, owner's manuals and tips on what to expect from a mechanic. Ten grand will buy you a car in very good, but not mint, condition. Always put a car from this era on a lift to check the underside for rust. If you can spare the cash and tinkering time, buy two--one for the body (2002s advertised as "California cars" should be relatively rust-free, but 1974-76 models have primitive emission-control devices that reduce the car's power) and a cheaper, rusted-out parts car with a vroomin' engine. --MARION ASNES

GIT A GUITAR Recently, in the grip of a mid-life crisis, I spent $3,000 on a Lowden F-32C acoustic guitar, which being handmade of walnut, spruce and rosewood, not only sounds good, but also smells good. Had I known then about this how-to-spend-$10,000 extravaganza, I might've gone for something more extravagant. Like, for instance, a Guild Custom Shop Benedetto Fratello for $14,000.

There are other electric hollow-body jazz guitars about as good soundwise as this handsome thing, but none in the same league for looks. Spare, elegant. If Fred Astaire had been a guitar, he'd have been this one. Designed by Bob Benedetto, a Florida guitar maker, they're made by the Guild Guitar company (www.guildguitars.com). Or you could even have Benedetto build you a one-of-a-kind instrument himself (www.benedetto-guitars.com). Prices start at $30,000; most go to collectors, but a few are bought by real-live musicians, long-suffering itinerant jazzers who, Benedetto says proudly, "drag them through the saloons of America." --PETER CARBONARA

THE PERFECT POOCH I love my dog. She's now three and a wonderful member of the family. But for the first two years of her life, she was a total pain. She chewed furniture, ate the new upholstery off my couch and nuzzled up to us just enough to make it worthwhile. Now my kids are asking for another pup. I'd be willing, except that I'm not up for another two years of torn Teddy bears--and brown grass in all the wrong places.

The good news: For $10,000, I can skip the bad parts. First, I'd spend $1,000 on a bearded collie from a quality breeder, complete with shots and a veterinary checkup. (I'd opt for a male, because as breeder Rosemary Schroeder says, "The females tend to be a little bossier and more independent. The males are really big wussies.") The rest of the dough buys me a week with pet trainer and psychologist Warren Eckstein. He'd move into my abode and train not just my pup, but my family. Eckstein prefers to start with dogs at just eight weeks of age, before they've picked up bad habits. "By the time they're 12 weeks, most pups think their name is 'No,' because that's the only word they hear." A week later, Eckstein swears, the pup will know all the basic doggie commands--as well as his boundaries: no chewing, no jumping and (most important) no eating my reupholstered couch. Perhaps his older sister will take a lesson too. --JEAN SHERMAN CHATZKY

SAVE YOUR KID Before heading off to pursue college or a career, your teenager could learn invaluable lessons in charity, humility and self-sufficiency by spending time doing good in another part of the world. For as little as $20 a day plus travel expenses, the kid can spend up to an entire year preserving nature in Australia, building houses in Costa Rica or teaching schoolchildren in Ghana. "These are not vacations," says Holly Bull of the Center for Interim Programs (617-547-0980), which helps parents and children find such programs for a $1,900 fee. "The students are learning languages, doing service work and gaining skills."

Britain's Prince William, 18, is spending his gap year (what the Brits call the year between high school and college) doing conservation work in Africa and scrubbing toilets in Chile. But your child can just as well stay in the States to volunteer at a midwifery school in Kentucky, a mission in Navajo country or a wolf conservation group in Colorado. And yes, it'll look great on his or her college application too. For additional opportunities, visit the website Whereyouheaded.com or contact local religious organizations. --B.D.

TREE-MENDOUS Why bother with a young slip of a thing that'll need a decade before you can enjoy its shade? You can have it right now from a big tree--a very, very big tree--that brings instant splendor to your property. For sheer majesty, consider the European copper beech (Fagus sylvatica purpurea), a mighty specimen with a round silhouette and leaves that start out purple and fade to a coppery brown in the fall. It can live 100 years or more and stretch as tall as 100 feet. The bark resembles elephant skin, making this tree a thing of beauty with or without its leaves.

A good nursery can help you buy, transport and plant a 20- to 25-footer in your front lawn--all for $10,000. Leave plenty of room out there: A tree this size has branches that spread 12 feet wide, and it's still growing. --M.A.

A STATUS STOVE Tools can be divided into two camps: utilitarian objects we treat with disregard and finely crafted models that stir our most ardent emotions. For some cooks, cast-iron Aga stoves rise above mere kitchen gear and make the heart quicken. "I'd give up anything in my kitchen--except my Aga," says Paula Swink, owner of Aspen House Bed & Breakfast in Leland, Mich.

What's so special about them? Start with the ovens. You get more than one (two or four, depending on the model), as well as various burners, all of which are preset at temperatures from 125[degrees]F to 450[degrees]F. That means you can simultaneously bake, roast, boil, simmer, grill and toast. (Swink warms salmon crepes in her Aga while baking scones, grilling tomatoes and portabello mushrooms, frying bacon and poaching eggs.) You never actually turn off an Aga, but don't worry about overheating; Agas produce up to 4,000 BTUs of heat an hour, yet that's only a tenth of what conventional ovens kick out when turned on.

Choose among 12 colors, from claret to Wedgwood blue, but on this story's budget, you'll have to settle for the two-oven model, which costs $9,275. Shipping, installation and venting run another $1,500. Call 800-633-9200. --L.H.G.

GET OUT OF TOWN

How far will $10,000 take you? Buy a Round the World economy airline ticket from www.staralliance.com (for about $4,000) and you could manage a six-week, six-continent jaunt, spending a moderate $140 a day. Or pay $7,000 for one glorious evening of wretched excess in the Royal Suite at London's Lanesborough Hotel (800-999-1828), with three bedrooms, drawing room, dining room, kitchen, private butler and limo. Tack on all those English taxes and a few bottles of Dom Perignon, and the splurge is complete.

Nice. But most of us prefer the middle ground, no? Consider these trips, which don't include air fare.

DELUXE RAIL TRAVEL Get in touch with your inner robber baron on the Pacific Coast Explorer train journey by American Orient Express. The Los Angeles-to-Seattle route travels over 1,434 miles of tracks, including stretches that are rarely traversed by passenger trains. Enjoy haute cuisine and soak up views from luxury vintage train cars carrying a total of 100 passengers. Spend time off the tracks at Hearst Castle, Napa Valley, Mount Hood and more. The Presidential Suite with shower is $4,790 per person for the seven-night trip, which includes some hotel stays. Call 800-320-4206.

CUSTOMIZED TOURS IN TUSCANY On Il Chiostro's Cooking & More in Chianti trip, the well-connected Fabio Mucchi designs a trip around your interests, mixing cooking classes with, say, private winery and olive mill tours, visits to hill towns and artists' studios (you'll have a car and driver), even lunch at the villa where Bernardo Bertolucci's Stealing Beauty was filmed. Spend seven nights in a castle dating from the 1500s or a charming little hotel in a local village. Cost: $3,800 to $4,200 per person. Call 800-990-3506 or visit www.ilchiostro.com.

GAUGUIN'S POLYNESIA Get a taste of what entranced the artist by taking Radisson Seven Seas' Tahiti by Gauguin cruise. A luxury ship that holds 320 passengers (a tenth of the crowd on the biggest tourist boats) spends seven nights cruising from Papeete to Bora-Bora and other islands. There's helicopter "flightseeing," snorkeling, and shore visits to botanical gardens and archaeological sites. Kayak, windsurf, feed stingrays, get your scuba certification...or hit the spa, pool or casino. A cabin for two with a balcony is $8,790. Call 800-285-1835 or visit www.rssc.com.

WYOMING RANCH Escape to Big Skyville with your family by way of Heart Six Ranch in Jackson Hole. Your backdrop: the Grand Tetons, rising 13,770 feet above the valley. Trail rides, float trips on the Snake River, canoeing, fishing, an outdoor hot tub for stargazing and, of course, s'mores around the fire. Counselors entertain the kids, who have a dining room in eyeshot of parents. Six days for six: $8,100. Call 888-543-2477 or visit www.heartsix.com. --SUZANNE WOOLLEY

MAKING DO

You might be surprised to learn how much $10,000 can't get you. Mind you, we're not complaining.

RENT A FERRARI F355 CONVERTIBLE Eight days. That's how short a time you can keep the Ferrari pictured above. They may, however, be the very best eight days of your life. Baron's Exotic auto rentals in Los Angeles; 310-472-0057.

DIG FOR ROCKS At Cartier and Tiffany, we were dazzled by the round, brilliant-cut diamond engagement rings set in platinum--but you'll have to settle for less than a full carat if you want a high-end rock ("colorless" with "very small inclusions"). Or you could forget about the box and head for Manhattan's Diamond District, where 10K buys 1.3 carats of similarly luscious product. Try Iannelli Diamonds, 212-575-1700.

CREATE A NEW YOU. But not a whole new you. A basic facelift costs up to $7,500, so breast implants ($5,000) would bust the budget here. While all plastic surgery is serious stuff, it seems as if liposuction (costing as little as $2,000) has become the medical equivalent of "Would you like fries with that?" Call the American Society of Plastic Surgeons at 888-4-PLASTIC.

HIRE A CELEBRITY Add a vaguely familiar face to your next party. But who? Alas, it will have to be C-list. We asked for Potsie from Happy Days--you know, to meet and greet our guests for a few hours? The sad fact is, Anson Williams "is a reach" for $10,000, says Premiere Speakers Bureau (800-296-2336). But get this: Ten grand could snare you Don Most, the guy who played Ralph Malph. --ERICA GARCIA AND SRIDHAR PAPPU