Dear Harry: I was ill last fall and had to go to a hospital. I cannot afford health insurance, and I am too young to be covered by Medicare. I got my bill for $800. I called the hospital and asked if I could pay the debt at the rate of $40 per month. The response was to send in the first payment. I later got a call from their credit department saying that they would have to insist that I pay $133 a month. I just cannot afford that right now. The person on the phone said that they would have to turn it over "for collection" if I didn't pay the $133. I continued to pay the $40. Can they still turn me over for collection?
What Harry says: They can, but probably won't. You are making regular payments that will get their money paid in less than two years. Sure, that's slower than they would want, but it's better for them to wait than to spend money in a fruitless pursuit of a faster payoff. I suggest that you contact their credit department again to tell them you will continue your present payments, and any efforts to get you to pay faster will only cause them to be spinning their wheels. Meanwhile, try hard to find health insurance.
Dear Harry: I am a senior citizen with no children. I'm in pretty good health. In 1984, I purchased a number of EE bonds from Fidelity Bank. They were registered to me at my old address. The old Fidelity became First Fidelity, which then became Wachovia. Are these bonds still good? Can I redeem them at any bank or just Wachovia? I put them away long ago and just forgot about them. I hope I didn't get hurt by not cashing them in when they matured.
What Harry says: Good news! The bonds had a 30-year extended maturity. As a result, they are still bearing interest. You can redeem them at almost any bank. To save yourself effort, call your bank before bringing them in.
Dear Harry: I have been a credit card customer at my bank for a long time. About three years ago, I made one late payment, and the bank hiked my interest rate by 3 percent. OK . . . I was late, and I have to suffer for that. I have not been late since. You can imagine my surprise when they just sent me a notice that my rate was going from 10.74 to 24.24! That increased my monthly payment by $190! My credit report has not been "perfect," but the record on that credit card is for the last three years. What gave them the right to increase my rate? I want to close that account, but I was told that closed accounts would have a strong negative effect on my credit report. Help!
What Harry says: A closed account is far better than having to pay the astronomical rate they want. It may also have the positive effect of not having too much available credit. Dear Harry: I am writing on behalf of a friend who is completely intimidated by all things financial and who is a bit naive with her trust in others. Her father recently died, leaving her and her brother a substantial estate to the tune of more than $500,000. At the moment, her brother has control of the entire inheritance, and she wants her share. I told her that the first thing to do is simply ask when she can expect her share. If he shows resistance, what can she do? The next question is what should she do with the money?
What Harry says: The first step is to get a copy of the will. Her father may have provided for her through a trust which would relieve her of the responsibility of handling the money. If not, the Will will determine how much she gets and when she can get it. If her brother will not give her a copy, she can get it from the Register of Wills Office. With that information, she can press her brother for her share. In her case, I would suggest that she consider splitting the money roughly equally between a fixed and a variable annuity. A comparison of offerings by Vanguard and Fidelity mutual fund groups is a good way to go. Of course, if there is a good deal less or more than the $500,000 in her inheritance, that suggestion has to be re-evaluated.
Dear Harry: Over many years, my parents set up money in custodial accounts for my sister and me to accumulate enough for college tuitions. My sister's funds were used for her tuition over the last several years. I am graduating from high school this year, and I have no desire to go to college. I want to go into sales, and I already have a decent offer from a car dealer. I'll be 18 in June, and I want to use the money in my custodial account, but my parents won't give it to me. They say that it's for college only. I hate to do this, but isn't there some way that I can force them to give me the money when I'm 18?
What Harry says: We are a strange society. Majority doesn't always occur at the same age, even when it's in the same state. The tax law has a bunch of different ages and conditions for qualifying for "dependency." In Pennsylvania, you can drive at 16, vote at 18, and drink alcohol at 21. If that money is in a custodial account, you can get it at 21. However, if it's in a trust account, you may not ever be able to get it unless you use it for tuition. Why not reconsider going on with your education? You can certainly get a part-time job in sales while you're in school and on vacations.
Dear Harry: We were going to do a big remodeling job on our kitchen and bathrooms. Everything is set to go with a closing next week on a new mortgage to cover the costs and the old mortgage balance. Today, we got a notice that there would be no more overtime for at least the next year. Harry, I can't possibly make the additional payments without it. The lender told me that I'm committed, and there's no way out. Suppose I just don't show up? The agreement with my contractor is contingent on receiving the additional financing. Please tell me that I don't have to tear my hair out.
What Harry says: You don't have to tear your hair out. There is a federal law that protects people in situations such as yours. You have until midnight of the third business day after settlement to rescind the deal. And you don't need a reason. There's also a little more good news. You will be able to get a full refund of appraisal fees and other costs incurred in getting the loan.*