If you don?t take risks, you could lose big bucks

DEAR BRUCE: My father-in-law recently passed away. After paying off all our debts, we will still have $80,000 in cash. While I would like to save this for our retirement, my wife is very conservative and does not want to invest in any stocks, mutual funds, etc. I would like to respect her wishes, so we are looking at CDs and government issues. What do you recommend? We are in our late 20s. ? F.C., via e-mail

DEAR F.C.: I would urge your wife to get an education in how to invest money. If you follow her plan and stay strictly with the CDs and government issues, you will literally be throwing hundreds of thousands of dollars away over the 30-plus years between now and your retirement. It?s frightening that someone as young as she is not willing to take a decent risk in the marketplace. Over the long pull, she is going to get hammered. Why don?t the two of you decide to do a little studying together? You might take an investing course at the local community college or go to a seminar or two. By all means, read current periodicals devoted to investing. I hope she will come around. It would be a shame to see all that money go to waste.

DEAR BRUCE: I am in the military, stationed abroad. Is it smart to buy land now so that we can build a retirement home in about 14 years? I plan on retiring from the military at that time, but I will have a post-military career. What factors should I consider before making a decision? ? B.T., via e-mail

DEAR B.T.: I would not purchase land looking that far ahead. First of all, land is an alligator; it eats. You will have to pay taxes, you must have the land insured in case someone gets injured on your property and, further, since you are not around, you have no idea in which direction the community where you purchased this land is headed, whether it will develop the utilities and so forth. It is far better, in my view, to continue to invest your retirement money in the marketplace. When the time comes, you can purchase the land. Fourteen years in advance would be a very risky endeavor.

DEAR BRUCE: At age 51, does it still make sense to open a Roth account? I plan to retire in 12 years. ? George, via e-mail

DEAR GEORGE: If you have no need for the money for the next 12 years, why not? At your age, it will not be as great a benefit as it would have been several years ago. Still, you can put in $24,000 over the next 12 years, all of which will labor intensely for you at no tax consequence. You can leave it there as long as you wish. In other words, if you have other retirement monies to draw upon, use them first and leave the money in the Roth IRA. It?s a shame you didn?t get started a bit earlier, but it sure isn?t going to hurt you to take advantage of what I consider to be the best tax break that America offers.

DEAR BRUCE: I have a credit card in collection. In the past two years, it has cost me almost $2,000 in interest and late fees. Can you recommend what my options are to stop the interest on that end? — R.T., via e-mail

DEAR R.T.: As long as you legally owe the money and you are not making payments, they are going to continue adding the interest and late charges. You might wish to go to one of the nonprofit credit-counseling agencies, such as the Consumer Credit Counseling Service. Often, they can negotiate a lower interest rate and the succession of fees.

I am at somewhat of a loss as to why you have done nothing over the past two years. Just because you haven’t had the wherewithal to make payments does not mean ignoring the problem is a good course of action. This is not going to go away; it will just become a larger problem. When you don’t correspond with the company, it feels you are a deadbeat and will come after you any way it can. Understandably so.