Accepting loan from parents is a bad idea

Dear Dave: I think it’s pretty narrow-minded of you to suggest that people never, under any circumstances, accept a loan from parents or in-laws. I’ve accepted loans from my parents on two occasions, and everything worked out fine. — George

Dear George: It’s not narrow-minded. It’s the truth, and it’s good advice. You can drive down the road at 100 miles per hour and get where you’re going in one piece. But that doesn’t prove it was a good idea.

In lots of families this kind of situation produces a strain on the members involved and causes regret. Plus, it’s going to embarrass most people when they’re supposed to be adults and then they have to run to Mommy and Daddy for money. The borrower is always slave to the lender, George. And holiday dinners taste different when you’re sitting at the table with your masters instead of just Mom and Dad.

Just because you got away with doing something dumb a few times doesn’t make it okay. And it doesn’t make me narrow-minded. — Dave

Paying extra to creditors

Dear Dave: After reading your books I’m finally getting back into church, getting control of my money and paying off debt. Sometimes I send more than the required payment, and I was wondering how I can ensure that this extra money is applied to the principle. — Matt

Dear Matt: Some payment slips will have a line for specific amounts designated toward principle only. If you don’t see anything like that, I’d suggest sending them a separate check with “principle only” written all over it in a separate envelope. You might also want to include a copy of a payment slip to avoid confusion and make sure the money is credited to the right account.

You’ve got the right idea, my man. Focused intensity over time multiplied by the power of God equals momentum. Keep it up and you’ll be debt-free before you know it! — Dave

Penny stocks

Dear Dave: What do you think about penny stocks? I’m thinking of investing about $20 a month until I get more comfortable with the stock market. Do you know any brokerage firms that will accommodate this and let me pick my own stocks for a flat fee? — Mark

Dear Mark: You bet. Try the offices of I. Fleecem and Co.

Are you kidding? On the ladder of stupidity, penny stocks are just a rung above day trading.

The idea that you’re going to play around with these things and make some money or gain valuable knowledge about the stock market is ridiculous.

If you’re serious about investing, pick some good growth stock mutual funds that have been around for 10 to 20 years. With lots of these you can start out for as little as $25 a month and have the amount automatically drafted from your checking account.

Messing with penny stocks is like playing the roulette wheel. Stay away from them! — Dave

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