Pay Dirt is Slate’s money advice column. Have a question? Send it to Athena and Elizabeth here. (It’s anonymous!)
Dear Pay Dirt,
My parents didn’t save any money for my education, and they seem to be wasting all the money they saved on plastic surgery and designer bags. The education system in my country is extremely poor and I dream of going abroad to escape the miserable way of life here. I’ve had this plan since I was 10 and I keep bugging my parents about my college funds. They always told me that it was not necessary and that they had enough money to pay when the time came.
I’m graduating in less than a year, and time is running out. I now realize that the plan I have been manifesting from such a young age is impossible. The education system I have does not offer exams such as SATS, IGCSE or A-Levels unless they are paid for separately from tuition.
I don’t know what to do, because I didn’t prepare myself for this situation due to the constant assurance of “everything will be fine”. I don’t even know how I’m going to get into university in my country, because I never set my sights on it, so I don’t know what it takes. I’m stuck between a rock and a hard place, and really I’m in over my head.
—So disappointed, and rethinking everything
I’m sorry your parents promised you one thing and actually did another. Our parents are human, and sometimes they make selfish choices without thinking about how they affect their children. I think you may need to put aside your (justified!) anger at them in order to go ahead with this plan at this point. You figured out a little late in the day that they really wouldn’t help you, but you still have time, especially if you’re willing to work for a while between high school and college.
It’s a bit difficult for me to say how you can finance your studies and come to the United States, because I don’t know where your home country is, but we have a few options you can look into. First, you must apply and be accepted to a school that is part of the Student Visitor and Exchange Program, otherwise known as SEVP. The United States Department of Homeland Security created the SEVP to enable students based outside of the United States to ensure that they receive a quality education at an accredited school. Once a student has been accepted, they can then apply for a student visa. Most visas for educational purposes are F-1.
Although you may not receive federal funding from the U.S. government to help you with your education, you may still qualify for scholarships, private loans, and any other type of funding your country or an SEVP-approved school may have. EducationUSA is also an important resource. With over 430 counseling organizations in over 175 countries, EducationUSA is a network provided by the US Department of State that offers step-by-step guidance to make your dream a reality. Organizations in this network can also help pay for testing fees like the ones you mentioned above. Good luck.
Dear Pay Dirt,
For years, I had been looking for a house to settle in, because my current apartment is too small and suffered from multiple infestations (mice, cockroaches, etc.). In my area, renting is getting expensive, and it would probably be cheaper, or at least about the same, to pay the mortgage and utilities for a house I own.
However, house prices being what they are, I found that when I talked to someone about pre-certification, they were talking about a mortgage that wouldn’t buy a house in this region. A condo may be doable, but also has some of the same issues as a rental (neighbors, infestations, etc.).
Enter my mother. Years and years ago she talked about helping me get a mortgage. She is retired and has an excellent credit rating. She doesn’t suffer for money either (even in retirement she earns as much or more than me). We went so far as to talk to a financial planner, who said it wasn’t really a good idea because if my mum died (she’s over 70) I would lose the house and the mortgage would go to the bank if it is not paid.
Since then, we’ve found that the planner might not be the sharpest person (my mom switched planners when he retired, and the new person had huge problems with his wallets) , and I got to know two other people in that kind of relationship. Both said they don’t foresee any problem if their parents were to die… but also, their parents are younger than my mother.
Is it really something viable? Is there a way to write something in a will or a trust or something, so I can keep the house that comes with it? Is it even a good idea or should I wait to see if the market comes back down?
—I just want to get out of this apartment
Dear Want Out,
Sometimes financial planners aren’t the brightest in the box (apologies to any financial planners reading this – I’m certainly not talking about you!), so congratulations on your research.
Your best course of action before moving any further is to consult a real estate attorney. Each state has different laws regarding property inheritance. Realistically, if you’re on both the deed and the mortgage as co-signers, you should be fine. However, if your mother has children other than you, or family members who would benefit if something happened to her, you should make sure you are protected by a will or trust. Death doesn’t always bring out the best in others, and the last thing you need to do is worry about what to do with a home when you’re grieving. So be sure to consult a lawyer who will tell you how to best protect yourself when you are ready to buy.
As a reminder, as you decide what to do: buying a home isn’t just about making a mortgage payment. While it may seem cheaper to own than to rent, that’s not always the case. Homes require expensive repairs or end up being money pits. Property taxes can rise quickly and without warning. So when looking for a place for yourself, remember the rest of the picture and don’t put yourself in financial trouble if something were to happen.
Dear Pay Dirt,
My siblings and I are about to inherit the money our late aunt had at a well-known brokerage house. Instead of just sending us checks as we would prefer, however, the brokerage told us that they would open accounts in each of our names with our respective amounts. Can they do this? Make us their “customers” without our consent?
—That seems strange
First of all, I wanted to tell you that I’m sorry for the loss of your aunt. It sounds like she cared about you and your siblings and wanted to set you up for financial success, which is great.
The brokerage does the usual thing by opening accounts for you and your siblings for your respective amount, instead of writing you a check. By law, the brokerage cannot sell, trade, or do anything else with your aunt’s investments because she is legally deceased. Once the proper documentation has been received (which appears to be the case), they transfer the investments to you and your siblings. Transferring shares and other assets is very different from liquidation, which is what you and your siblings want.
The good news is that you don’t have to keep accounts for very long. Think of it as a transitional step. Once you’ve sold your shares, you can thank your aunt for the money, close the accounts, and be done with it.
Dear Pay Dirt,
A friend of my partners recently died suddenly and (also unexpectedly) left him a home. We’re both in our mid-twenties with no savings, good but not good credit, student debt, minimum wage jobs, and a rented apartment. None of us have inherited anything worthwhile before. Basically, he wasn’t prepared for this, and I’m not helping.
The house is a few hours from our house, so we’re definitely not going to move in, but we don’t know where to go from there. A lawyer? Some sort of financial advisor, probably, but what kind? If he sells it, he’ll have more money than we ever thought. Renting it out would give him mortgage payments and double his current income. In any case, it is life changing financially.
I’m mostly concerned with helping him make the best choice for himself, but we’re planning to get married in a year or two, so I’m also wondering how whatever he chooses might impact me individually or about our life together. How can you even begin to make a decision like this, and what do you do after you decide?
—We really want to do things right
Dear, you want to do it right,
I’m so sorry for the loss of your partner’s friend. A house is definitely a major item to gift by inheritance, especially without notice, so it’s great for you and your partner to think about it.
First, I would make sure you have all the financial and legal documents needed to become a homeowner. In the information you provided, it appears that the property is held free and clear, but if not, make sure the mortgage has been properly transferred with the deed. You’ll also need to make sure your partner has updated home information with the county treasurer’s office so property taxes are taken care of.
Next, encourage your partner to take out home insurance. He should also hire a building inspector to see if there are any problems with the foundation, roof, and plumbing. Houses require maintenance, and catching costly trouble now will determine what he can choose to do with the property. If the property needs major repairs, he can choose not to undertake them and sell as is. If the property is in good condition, he may have more incentive to become a homeowner, since the cash flow would cover his own living expenses.
What may or may not affect you? You’ll need to see a lawyer on that one. Laws vary from state to state, so it’s always best to speak to a professional when considering what assets and liabilities can be incorporated into a legally binding contract such as a marriage. For now, don’t co-sign anything you don’t feel comfortable with, especially if you don’t have any legal status, like having your name on the deed.