Smart Money

DEAR BRUCE: I've recently begun taking over my mom's finances. She is 70, in poor health, currently in a nursing home and doesn't drive.

Mom holds an accidental death and dismemberment policy through her credit union. The information I have received from them states that coverage is $50,000, but the fine print states "at the time the primary insured or covered spouse reaches the age of 70, his or her benefits are reduced by 50 percent. This policy does not earn cash and is not eligible to earn dividends." She pays $18 every three months for this policy. Is it worth it, financially, to maintain a policy like this? -- G.T.

DEAR G.T.: Unfortunately, you're in a tough circumstance, with your mother in poor health and in a nursing home. Is the policy worth it? I doubt it! What you're going to have to do is go over the numbers. The company clearly has an obligation to sit down with you and explain in detail exactly where the money is going and how much will be returned to you or your mother's heirs.

DEAR BRUCE: My friend is having some bad money issues since his divorce. He gave his ex-wife their only car because she has main custody of their 1-year-old son. He desperately needs transportation to keep his job. I have an older car worth around $500 to $800. I would like to let him use it. What should I do to protect myself? -- Reader

DEAR READER: If I were you, I would insist that you give the car to him and put it entirely in his name. If you can trust him to give it back to you if you ever need it, that would be great. There is no way I would let a guy with no money drive around with an automobile that's in my name.

Make it clear that you're willing to help him out, but you're going to give him the car and he will have to insure the vehicle in his name only. In no way should your name be attached to that vehicle.

(Send questions to bruce@brucewilliams.com. Questions of general interest will be answered in future columns. Owing to the volume of mail, personal replies cannot be provided.)

(The Bruce Williams Radio Show can now be heard 24/7 via iTunes and at www.taeradio.com. It is also available at www.brucewilliams.com.)

More like Smart Money