Jewish World Review Jan. 19, 2001 / 24 Teves, 5761
Roths and young people
DEAR BRUCE: I am 29 years old, married and self employed, as is my husband, and we have no children. I make about $50,000 a year. So far I have very little savings.
I know nothing about investing but have done some studying. I have a few hundred dollars in my savings account and will be adding some more soon, which will give me $2,400. I can leave it there or put the $2,000 into a Roth IRA. This isn't much money to you, but it is a great deal to me. Is this a wise move? -- E.C., via e-mail
DEAR E.C.: In my view, for young people like yourself, opening a Roth IRA is not only a good deal but a tremendous deal. That money will be in there for 30-plus years in your case, and every nickel it earns over the three decades-plus, you get to spend, no taxes. What a great deal.
Savings accounts give you very little interest. You might want to involve yourself in learning a bit about mutual funds, which is putting your money in with a lot of other people and having a professional investor choose the stocks that it gets invested in. In my view, for the average person, this is the better way to go. Understand, however, that not all mutual funds make money. Some have lost a great deal. You have to be picky and do your homework.
DEAR BRUCE: I had a one-year lease on my apartment. I paid my rent on time and had no problem with the landlord. He sent me a renewal with a $15 increase. I said to him that the $15 was OK, but I wanted to go month-to-month because I wasn't sure how long I was going to stay in the area. He said that if that was the case, the increase would be $25. I swallowed hard, but I took it.
Two months later, he said there would be another $10 increase. I told him that he couldn't do that, and he asked why not. He said that since I am on a month-to-month basis, next month was going to cost $10 more or I could leave. I paid that one too. Now he just came in with another $10 increase two months later. He said that I can stop this, and he would even drop the rent back, but he wants a one-year lease. I don't want to be tied down for that kind of time. I may have a reason to go elsewhere. Can he do this? -- T.J., Tacoma, Wash.
DEAR T.J.: Of course he can do this, and why should he not? You want the luxury of not being tied down, so he has the instability of an apartment that may come up vacant any time. He says that he wants to be compensated for that. You are asking for a concession and he's giving it to you, but you will have to pay for it. He is within his legal rights to raise your rent every month unless there is some statute in your community, which I doubt, that would prevent this.
DEAR BRUCE: This may seem like a minor matter, but at our house it's a big one. Our fifth-grade son has been suspended from school. He was accused of taking another youngster's lunch money. While our kid is no angel, he has not been in trouble in school and we have found him to be, on most occasions, truthful.
He absolutely denies touching this child or taking his lunch money. Just on the basis of the accusation by the other child, who showed up at school with no lunch money, he has been suspended until he admits to stealing. My husband and I are absolutely adamant that if he did it, we would tell him to own up to it. But if he didn't, then he should stand up for his rights. Are we being foolish? Should we just say that he did it and then get on with our lives? -- T.P., via e-mail
DEAR T.P.: There is no way I would ever show a child that I was going to give up just for a matter of expediency. The fact that they have just accepted carte blanche the other youngster's story is hard for me to understand. I would insist that the other child, your youngster and the two sets of parents be brought in together. This way, perhaps the truth can be diserned. It may be that this kid lost his money and was afraid to tell his
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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