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There are thousands of mutual funds out there today and there are more being added every day. Before you even begin to look for a mutual fund, you need to look at your economic goals. Are you just starting out and want to get a good growth fund that will lead to a healthy retirement nest egg? Do you already have that nest egg and want to put it somewhere less risky where your capital will be protected but you can still bring in a good steady return? Do you want a fund that will give you some income?

Before you talk to anyone about mutual funds, know what your goals are and how much money you are prepared to invest. How much do you have to invest upfront and how much can you expect to add on a monthly or paycheck-to-paycheck basis? Many mutual funds have a minimum investment requirement.

If you do not have a financial advisor and cannot afford one, there are many places where you can research mutual funds as well as other financial instruments. Perhaps the best-known source for mutual fund ratings is Morningstar (www.morningstar.com). Morningstar rates funds on a five-star rating system. It also identifies funds on a three-by-three grid as Small, Medium, or Large in terms of Value, Blend, and Growth. There are also Small, Medium, and Large cap funds. These identifying characteristics simply let you know the general make-up of a fund.

For example, a small blend fund simply has fewer stocks than a large blend. That doesn't make it better or worse. A large growth fund might sound better than a small growth fund but it might also have a higher risk factor. Morningstar rates most funds and if you find one that interests you, it is possible to get much more information, including a prospectus that will tell you more than you ever wanted to know.

One of the best rating systems for a fund is how well it has done over time. For most funds you can find out how much it has earned over the past month, the past three months, six months, year, three years, five years, and, if it is old enough, 10 years. One should never buy a fund simply based on its history because funds can be as volatile as an individual stock and the wisdom on the street is, "Past performance is no guarantee of future performance." But recent upward moves might signify a good fund.

Funds are generally purchased from companies that create their own funds, including many banks and companies like American Express. Some of the best-known fund companies are Vanguard, Fidelity, Dreyfus, and T. Rowe price. There

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