Student loans: paying off loans with different interest rates
Student loans can come with different interest rates. Is it better to pay off students loans that you owe the most on, or that have the highest rate first? Look to question No. 6 of the reader mailbag.
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Q3: Auto insurance challenges
We are getting quotes from several different companies for home and auto insurance. Company A consistently ranks among the best in customer service and satisfaction, but its premiums are more expensive than Company B for a similar level of coverage. Company B offers cheap coverage, but has a mediocre reputation. Is it better to pay more for a policy from a reputable company, or is it better to save money now and keep your fingers crossed that you won’t need to file a claim any time soon?
The Simple Dollar is a blog for those of us who need both cents and sense: people fighting debt and bad spending habits while building a financially secure future and still affording a latte or two. Our busy lives are crazy enough without having to compare five hundred mutual funds – we just want simple ways to manage our finances and save a little money.
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It depends on why you’re buying the insurance. If you’re buying it just to fulfill a legal requirement and don’t really value the insurance itself, go for the cheap one.
However, if you’re actually buying it with regard to protecting yourself against the unforeseen, your insurance company is not one you want to battle with in a situation where you actually need home or auto coverage.
If I were in your shoes, I would probably get the more reputable coverage.
Q4: Handling elderly relative in decline
My 88 year old grandmother has lived in a senior apartment complex for some time, but it’s clear that she needs assisted living now (she’s had several falls, my father brings her medications to her every day because she can’t manage them on her own, she can’t really do her laundry or clean her home anymore…). She’s not really sick, just elderly and fragile. My parents pay her rent, and it is the maximum they can afford living the lifestyle they do now. They are in their 60s, well established in their careers and have made a lot of money in the past, but they just started a new business this year that has the potential to make money but is restricting their cash flow now. Additionally, they spend a LOT of money on “lifestyle upkeep” (luxury vehicles, hobbies, trips, a big mortgage, maintenance services, etc) that they don’t even get to enjoy very much because they work all the time and spend a lot of time taking care of my grandma. I have no idea what their plans are for retirement, and I’m not sure they do either.
When I see the way they are spending, I get really angry. How can they keep spending all this money on these things that don’t seem to matter to them very much, and aren’t willing to give anything up to give my grandma a better living situation? My grandma took care of me when I was young so they never had to pay for child care. Why aren’t they willing to help her now? It’s true, they’ve taken care of her for a long time, and maybe they are tired of it. But would they want me to make a decision like that when they are elderly and dependent on me?
They might try to get her in a nursing home if Medicaid will pay for it. She has spent time in nursing homes before, and she gets more depressed. She also doesn’t really need that level of care yet. I think they should either bring my grandma to come live with them in their large house, or give up some of their ongoing expenses to pay for assisted living in a small apartment for her (which Medicaid won’t pay for).
My husband and I don’t make very much money, and our home is too small for her, but we’ve offered to put what we can afford toward my grandma’s care. My parents have flatly refused. We visit my grandma frequently and try to help out by cleaning her home, taking her meds to her when my parents can’t, and other things, but what she really needs is assisted living or a daytime nurse.
My questions are these: is there anything else my husband and I can do to help my grandma while my parents dither around not making any decision and my grandma’s care just keeps getting worse? I’ve tried talking to my parents, both together and separately about this situation, but not with this much honesty. They are pretty touchy about how they spend their money, and hate talking about it with me.