Update insurance company about policyholder's death

Dear G.C.: Whose name is the home under right now? If the home has been transferred to you, then whether or not the insurance is valid at all could be held in some question. You are withholding what the insurance company would consider to be very important information, and that is that the house is vacant. Many companies will not insure vacant properties as they are magnets for homeless, illegal use, etc. Also, if there is a problem, there is no one there to take care of it. Were I you, I would notify the company as to the change of ownership. You might wish to move someone into the house as a caretaker at little or no rent. This would provide better security for your home, and in the event of a loss there would be no question as to the viability of the insurance contract.

Dear Bruce: I haven’t applied for a credit card in a long time, but this particular card gave me a 5 percent discount on my gasoline purchases. I received the card, but I was notified that my other credit card, issued by the same company, had reduced the limit on the old card by the amount that was granted on the new card. Why would this be? – J.S., Lawrence, Kan.

Dear J.S.: The reality is that they have deemed you credit worthy for a fixed amount of money, and they were giving you that amount on the card that you already had. The aggregate sum that they are willing to go on the hook for has not changed. You could, of course, apply for a higher credit limit and there is a likelihood that it will be granted. The credit card companies are looking at you as a whole entity. It doesn’t matter whether they issue you four cards or one, they are only going to grant a finite amount of credit.

Dear Bruce: My mother-in-law just received her share of her mother’s estate, approximately $19,000. She wants to know if she should hold back for her 2004 income tax. Is this going to trigger any federal inheritance tax? – B.B., Henderson, Nev.

Dear B.B.: Relax. The person who leaves the money, not the heir, pays any tax that is due from an inheritance. This is money that your mother-in-law can put into her sock, take to Las Vegas if she chooses or do whatever she wishes, but taxes are not an issue.

Dear Bruce: As a young girl during World War II, I took a quarter once a week to buy savings stamps and then bonds. We were very proud to help out. Since then, I have purchased bonds for my grandchildren, hoping it would help them in their later life. Now I find out that the bonds are not worth anything more than the original value. I am hurt and disgusted. I think I have been ripped off. – E.F., Duck Creek Village, Utah

Dear E.F.: It looks like you’re concerned because the bonds have matured and then no longer are collecting interest. The value you see on the front is the matured value, not the value when you purchased them. If the bonds have matured you might wish to cash them in and invest them in other instruments, which offer a far greater return.

Dear Bruce: I’m a flight crewmember involved in transporting troops to the Middle East. While at Fort Hood, Texas, I read your column regarding purchasing Iraqi dinars. I myself have bought 1 million. Would you buy the new dinar? As for the Treasury Web site, what should I be looking for concerning dinars? – P.A., Port Charlotte, Fla.

Dear P.A.: I am not an expert in currency transactions. If you have ever watched CNBC or similar channels or read The Wall Street Journal, you will see quotations are made on various currencies – the euro, pound, etc. – that change on a daily basis. When you multiply it by a million, you can see where it can be a very tricky enterprise. I do not know enough about currency transactions to personally speculate in these issues (and they are speculations). There are many who believe that the Iraqi dinar will increase in value. If that’s the case, then you will profit. If it goes in the other direction, then you will lose. This is a matter of your confidence, in the currency in question and the country’s future.

Dear Bruce: I’m nearing the end of my mortgage payments, which is good news, but I’m afraid of losing my tax deduction. I’m a relatively high-income earner and live in a very high tax area. My itemized deductions have been limited to less than the full amount. How can I determine whether it’s worth taking out another mortgage to preserve the mortgage interest deduction? – J.S., via e-mail

Dear J.S.: Borrowing money simply for a tax deduction makes very little sense. You are still going to pay 60 percent of the cost of the money after taxes have been taken into account. You will have to find a home for that money with little risk, since you are borrowing against your residence that will generate, once again after taxes, enough to break even. While this can be done, it is a far more difficult task in today’s world of very cheap money.

Bruce Williams is a national radio talk show host and syndicated columnist.