Dear Helaine: I own a single-family home in the Silicon Valley. There's about $1 million equity in it and an annual property tax of $2,000 (thanks to Proposition 13, which limits annual tax increases).

I no longer live in the area. I advised my adult children that they could live in the house by building a second story and renting out the first floor, much as I am doing now. (I'm currently receiving about $6,000 from a tenant.) That way, they could build the second story with some of the equity that's in the house, and their mortgage payments would be covered by the rent.

But the kids seem to think it would be better to sell off the home and pay off their student loans, and with the remaining amount, purchase another home in the Silicon Valley. The issue: Their property taxes would likely be -- based on what they say they are looking for -- about $25,000 annually.

I am old school. I think they would gain additional value by adding the second story, and they could pay off their student loans with their lower cost of living because the mortgage and property tax would be much less. Please advise! -- Hoping to Help

Dear Hoping to Help: You've made your children an extraordinarily generous offer. Instead of being grateful, your children are quibbling over the terms of the deal. So let me spell this out: We are not obliged to give our children down payments for homes, or aid and abet them in financial decisions we consider shortsighted. In this case, the home is your home. At the same time, your children are not obliged to take you up on the offer you've made, either. They could continue to rent elsewhere, or save up their own down payment (something I would imagine is rather hard to do in Silicon Valley).

So I am going to ask you: What do you want to do? Why do you want to give them this home? Are you sure doing so won't jeopardize your own finances? You could, after all, continue to rent out the home and keep it in reserve should your children change their minds, or if you decide to return to this rather expensive part of the country.

Or are you tired of being a long-distance landlord? In that case, you could sell the home and, again, if you wish, give some of the proceeds to your children for their future, or simply invest the money. What I wouldn't do? Take an action you vehemently don't want to do because your kids happen to wish it.

(To ask Helaine a question, email her at askhelaine@gmail.com.)

(EDITORS: For editorial questions, please contact Sue Roush at sroush@amuniversal.com)

Dear Helaine: I want to know what to do with my small but steadily increasing savings. I'm one year into a new career after staying home with a small child while grinding away at school. My husband supported us so we could (painfully) survive on just his income. He grew up middle class, so he graduated with no student loans and $200,000 from a trust he won't touch. He works a union job that pays OK and has a good pension plan.

We owe $200,000 on our home (we live in a pricey area) and $60,000 in student loans for my education. I made big money mistakes before I married, so I came into the marriage with no savings, no marketable skills and $20,000 in debt. Since I've started working, I've paid off all our credit cards, splurged on a few items, visited family and made donations to my favorite charities. I've also put about 20% of my paycheck into our joint account monthly.

I largely subscribe to the "what's his is ours and what's mine is mine" philosophy because I think I am at high risk of falling back into poverty should anything bad happen to me/us. Is this fair or insane? What should I do with the $20,000 I've saved so far? And should I sign up for my workplace retirement account? -- Now Richer, Not Poorer

Dear Now Richer, Not Poorer: It sounds like you feel your spouse is more financially advantaged than you since he comes from a more monied family and enjoyed benefits from that. But you need to remember you got something from that, too. He supported your family when you went back to school, and he doesn't seem all that concerned about how much money you are now putting into your joint accounts and how much you are reserving for your own use.

Here's where I would start: You and your husband need to sit down and talk all this over. That's really your first order of business. It sounds like both of your habits are good, but you'll do better in the short and long term if you are on the same page with your finances: How much should both of you put in separate accounts? What about the joint one? Do you feel any urge to further merge your finances?

There are no right or wrong answers here -- it's up to you and your spouse. But do it together, not solo. At the same time, you most certainly should sign up for your workplace retirement plan. It will not only give you your own individual savings, it will also allow you to put money aside for your future in a tax-advantaged way.

As for the $20,000, it sounds like a great emergency fund.

(To ask Helaine a question, email her at askhelaine@gmail.com.)

(EDITORS: For editorial questions, please contact Sue Roush at sroush@amuniversal.com)

Hi, Helaine: I recently sold my house and bought another one. I did a 20% down payment, received a decent interest rate on the mortgage, and still have funds left over from the sale. I don't want them to sit around doing nothing in my savings account, but I'm sort of undecided about what I should do.

I see two options: Is it smart to pay down my new home? Or should I invest in stock and bond market index funds? At the moment, I'm shying away from paying down the house because what if it's 2008 again and I need to default on the home? But maybe that's a wrong, shortsighted way of looking at it.

By paying down the house, I'll be saving years of interest on the loan. I'm not sure how long I'll be staying in it. I don't have any immediate plans to move elsewhere, but I'm also pretty sure I won't be there for the life of the loan. -- Mo' Mortgage or Mo' Money

Dear Mo': This is actually an easy question, and it doesn't require knowledge of the recent foreclosure crisis to answer it properly. While it often feels better to pay off a mortgage rather than put money in the stock market, the reverse is usually the case.

Over time, the stock market has offered people better returns for the long haul than real estate. (Yes, things can change, but that doesn't mean your particular home will do better.) At the same time, money put in a home is all but the definition of an illiquid investment. If you need the extra cash for any reason, there is no guarantee you will be able to get ahold of it -- the money could be literally trapped in your home. Banks do not need to offer you a home equity line.

Finally, I need to point out that some of that money should be reserved for an emergency fund if you don't already have one. One thing I've learned about homes is that things break, maintenance needs to be performed, and none of that is free. Make sure you've got enough in the way of funds to pay for that without needing to use a credit card to cover a sudden shortfall.

(To ask Helaine a question, email her at askhelaine@gmail.com.)

(EDITORS: For editorial questions, please contact Sue Roush at sroush@amuniversal.com)