What You Need to Know About Bonds

Ever wonder why prices of bonds and bond funds do what they do when interest rates fluctuate? Here’s what you need to know about how bonds work — as well as what you may think you already know that’s wrong. When you buy a bond, you are merely lending money to a government entity or corporation. Assuming there is no default, they will pay you interest for a period of time and then give you back your principal. Bonds have …

End of a Musical Era: Goodbye, Columbia House

I wanted to become a member of the Columbia House mail-order music club in the worst way. Remember those ads in magazines trumpeting amazing music deals: 8 records, 10 tapes or 12 CDs for just a penny?! (Shipping and handling extra, of course.) The idea of so much for so little made me dream of the stack of fabulous hits I could pop into my Walkman or into the cassette player in the family car. Everything from Chicago to Jim …

Creditors Can Snatch Your (Inherited) IRA, Supreme Court Rules

A U.S. Supreme Court ruling has just made estate planning a lot more cumbersome for some high-net-worth parents who want to leave tax-free money in a Roth IRA to a child. Retirement accounts are protected from creditors in bankruptcy cases so people don’t wind up destitute in old age. However, the court unanimously ruled on Thursday that this is not the case for those who inherit IRAs. The court decision involves a case of a woman who inherited about $450,000 in an IRA from her mother …

Some Student Borrowers Face Default if Cosigner Dies

Many parents and grandparents are aware of the hazards of cosigning an education loan, putting themselves on the hook to repay if the student doesn’t. Now another wrinkle has emerged that can end up hurting student borrowers: Under the terms offered by most private lenders, institutions can demand that borrowers immediately repay a loan in full if the cosigner dies or files for bankruptcy. These so-called auto-defaults can occur even if the borrower has been keeping up with payments. And …

Could Howdy Doody Save Detroit?

On June 18, Detroit, which has been wallowing in something like $18 billion of debt, became the largest city in U.S. history to seek bankruptcy protection. Detroit’s creditors have already vowed to go to war over a proposal by the city’s emergency financial manager to settle with them for just pennies on the dollar. Now they’re floating the nuclear option: forcing a sell-off of the holdings of the museum of the Detroit Institute of Arts, which is home to 60,000 …

Dad’s Legacy of Debt Inspired a Movement

This is a guest post by Jeff Rose. Fathers tend to leave lasting memories behind for their children. Fond summer memories for some might involve playing catch or ‘HORSE’ basketball, going fishing, or grilling hot dogs that tasted just right. For me, my father’s legacy was debt. Growing up, my father gave me everything: love, support and understanding. I cherished every moment with him and I wouldn’t trade those experiences for the world. When I got older that I started to realize that my dad …