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Jewish World Review Feb. 29, 2000 / 23 Adar I, 5760

Bruce Williams

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Paying for nursing-home care


http://www.jewishworldreview.com -- DEAR BRUCE: We would like to know the best way to invest our uncle's money so that we can get a monthly check to offset the cost of his nursing-home care. We would also like to know if there is some way that we can protect his money so that it is not all spent in the nursing home. -- H.S. (e-mail)

DEAR H.S.: The answer to your second question first: Since he is currently in the nursing home, I know of no way to protect his money. Had he anticipated this several years ago, I would have a different answer for you, but that has evaporated with time.

As to the best way to invest his money, you will have to determine how much risk you are willing to take with your uncle's money. There are any number of income funds with which you can get a check on a regular basis -- if not monthly, certainly quarterly. You might check with a broker and see what they would advise, and make your own decisions about no-load funds.

You failed to mention how much money is involved, and obviously the amount of money and the need for income are parallel. Without that information it is very difficult to proceed further.

DEAR BRUCE: Several years ago a friend came to me and wished to borrow $25,000 as an investment in his real-estate projects. I took out a $25,000 second mortgage, and he gave me an unsecured note. He has a lot of problems and can't make the payments, so I am making the payments on the second mortgage that I used to provide the money to him.

My house is worth about $93,000, but I owe $110,000, counting the second mortgage. I have already told him that all he has to do is to come up with the money and I will forgo any profit. If he goes bankrupt, am I out completely? What would you do? -- J.V., Lancaster, Calif.

DEAR J.V.: The hard facts are that if he goes bankrupt, you are out of luck. You will be just another unsecured creditor and the likelihood is that you will get nothing, leaving the second mortgage to be paid. While I am sure your friend had good intentions, if you will recall, good intentions and the road to hell are somehow related. The overwhelming likelihood is that you will get stuck for all or the better part of this "investment."



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).

Up

02/28/00: Rely on a real-estate lawyer
02/23/00: Keeping child's money safe from divorce
02/16/00: Just how important is a 401(k)?
02/14/00: Shaky partnership buying house
02/11/00: Protection by residential zoning
02/09/00: Benefiting from a reverse mortgage
02/07/00: Ensure your insurability
02/04/00: Absurd community zoning laws
02/02/00: Money or securities?
02/01/00: Can we KO a custodian?
01/31/00: Why sell a home you love?
01/26/00: Everyone needs a will
01/25/00: Will splitting stocks affect rollover?
01/24/00: Should early retirees contribute to SEP?
01/21/00: Strategies for paying off debt
01/20/00: Is 15-percent growth achievable?
01/19/00: Selling a second home
01/18/00: Running from a time-share
01/14/00: Don't be a spendthrift!
01/13/00: Who gets the house?
01/11/00: It all depends on size of estate
01/06/00: Check references before hiring an advisor
01/04/00: Savings bonds a bad investment
12/31/99: Out of state ain't that great
12/29/99: Warranty rip-offs
12/27/99: Checking up on investment handlers
12/23/99: Options good only when company's strong
12/20/99: Capital gains tax sometimes best
12/17/99: Don't give up your nest egg
12/15/99: Small-claims court no panacea
12/13/99: Termite company not liable for termites?
12/10/99: Services provided must be paid for
12/06/99: How do we minimize house-sale gain?
12/06/99: Maximize your tax shelter!
12/02/99: My neighbor won't maintain even a modicum of civility
12/01/99: Long-distance rentals a bad idea
11/29/99: Mortgage strategy A-OK
11/18/99: Students can work and learn
11/16/99: Value is what will sell
11/11/99: Y2K: No big deal for real estate
11/08/99: Real life is tough luck
11/03/99: The right time to cash a savings bond
11/01/99: Slow road for savings accounts
10/29/99: What do you want from insurance?
10/27/99: You have a right to see your tax forms!
10/25/99: Why own a house at 65?
10/22/99: Online fine, but CDs?
10/20/99: Love, honor -- and separate credit
10/18/99: Find the value of your stocks
10/15/99: Property lien prevents trade
10/13/99: Clear up debt, only then tie the knot
10/11/99: If it ain't broke...
10/04/99: Should I stick with the company IRA?
10/04/99: Get a financial education!
10/01/99: Insurance: Not much one person can do
09/30/99: Lost tickets are lost cash
09/29/99: Trusting only one financial planner
09/27/99: Adult children should help out
09/24/99: Tips for first-time home buyers
09/21/99: Use the rule of 72s!
09/17/99: Legal strategy can be a pain
09/15/99: Teen drivers drive up insurance
09/13/99: Always use an attorney!
09/10/99: Whose taxes are they, anyway?
09/08/99: How do I roll over my 401(k)?
09/03/99: How can I work out my IRS payments?
09/01/99: When your company can't pay you
08/30/99: Beware of shady viatical investments
08/26/99: Landlords vary on security deposits
08/25/99: Educational IRAs must be spent on education
08/23/99: Finding out the value of old stocks
08/20/99: How to get an FHA refund
08/19/99: 100 percent financing is a scam
08/16/99: Will I have to pay a capital gains tax?
08/16/99: Thinking about PMI
08/13/99: Short-term mutual funds a-OK
08/11/99: It's your job to shop around
08/10/99: Sometimes, roots need to be uprooted
08/09/99: 'Pre-approved' doesn't mean a thing
08/06/99: Only you can determine your investments
08/04/99: Bank IRA the lowest-risk option
08/03/99: Reverse mortgages good for the elderly
08/02/99: Get the survey BEFORE you buy the house!
07/28/99: Get a lawyer -- it's worth it!
07/27/99: If it ain't broke...

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