Jewish World Review Feb. 23, 2000 / 17 Adar I, 5760
Keeping child's money safe from divorce
DEAR BRUCE: If you wanted to give your child a gift of money but wanted to protect it in case of a divorce, how would you handle this? -- G.C., Butler, Ky.
DEAR G.C.: There are a number of ways that this can be done. The easiest thing to do is to put the money into a separate account in your name, letting your offspring know that anytime he or she needs money you will withdraw it and hand over the cash. That way, if a divorce becomes a reality, the money belongs to you and the spouse would have no claim on it.
DEAR BRUCE: We are building a rather substantial commercial building. We were supposed to be ready for occupancy by the first of the year, but now it could be two to three months late. While we can work around the inconveniences, my lender will not lock in my rate for that period of time. It seems to me that there ought to be some way to do this. Because there are a couple million dollars involved, even a half of one percent can make a big difference. We are pursuing it from every angle that we know of. Do you have any suggestions? -- B.G. (e-mail)
DEAR B.G.: I sympathize with your circumstance, however, it is unreasonable to ask a lender to lock into a rate that he or she might take a hit on.
I realize your concern but think about this: How many businesses can you think of could tell you what the price of a product will be in 30 years? That's what lenders are expected to do on a long-term mortgage. Obviously, most mortgages are not held to term, but I am sure that you can understand the point that I am trying to make. The only redress that you have is to "kick butt" on the construction end and get it done in a timely fashion.
DEAR BRUCE: I am 56 and my wife is 55, and we are in excellent health. We are contemplating retirement in about four years. A financial planner advised us to consider nursing-home care insurance. The programs would be much lower now than when we obtain senior-citizen status. Is this a good idea? -- A.L., Lowell, Mass.
DEAR A.L.: The viability of nursing-home insurance is a topic of endless discussion. As I have stated numerous times, the very wealthy and the very poor do not require nursing-home insurance -- it's the folks in the middle that should consider it.
While I think that it is a prudent buy for the middle class, which I am assuming you fall into, I see very little reward starting as young as you are. If it were me, I would put that decision off for at least 10 years until you reach 66. Those are the beginning of the dangerous years. Whether or not you specifically require this insurance depends upon your overall financial condition. A rule of thumb might be: If you have combined pensions and investment income of over $70,000 annually, the likelihood is that you would be able to do very well without the nursing-home
Send your questions to JWR contributor Bruce Williams by clicking here. (Questions of general interest will be answered in future columns. Owing to the volume of mail, personal replies cannot be provided.) Interested in buying or selling a house? Let Bruce Williams' "House Smart" be your guide. (Sales of the book help fund JWR).
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