DEAR M.K.: I have never been a fan of "interest only" loans other than to a professional real-estate organization, and that certainly would not describe you or me. You didn't indicate the amount. Right now, a 5.4 percent interest mortgage is a very good rate. It's entirely possible that interest rates will go up severely. Nine years from now, not only could interest rates be higher, but you will be obliged to be making a principal payment, as well. You didn't indicate your age, but I would suggest that if you're able to retire the "interest only" mortgage, it would be to your advantage. This will effectively be a 5.4 percent return on your investments, since that's what this money in the second mortgage is costing you. While in the overall picture that's a pretty poor return, in today's world, at least temporarily, it is decent. For many people, it's going to be a terrible jolt when they have to start paying principal, as well.
DEAR BRUCE: My daughters received stock certificates from their aunt's estate. Do they have to pay taxes on them, and, if so, how is it figured? They are adults and on their own. -- B.B., via e-mail
DEAR B.W.: The taxes on the stock that your daughters received are the estate's responsibility. There is no tax to be paid by the heir. However, from the date that the stock becomes theirs, any dividends, splits or if the stock goes up and sold at a profit, all of these items must be paid by them. Since I assume this has happened very quickly, they're home free as far as the current value. It will be very much to their advantage to take note of the market on the day that the stock was transferred to your daughters. That way there will be no question as to the basis value when they do sell them.