Prepaid car lease likely a loss

Dear Bruce: My father prepaid $17,000 for a threeyear lease on a Lexus. He passed away six months into the lease. Is there any legal way his estate can recoup some of that money? — D.M.

Dear D.M.: The first thing you should do is look at the lease agreement and see if it addresses the possibility of the person passing away, and if so, how it is handled.

If it’s not addressed, then I would call or write to the leasing agency and say that you’re turning the car in and, since the individual is no longer alive, you have no reason to keep it or any obligation to pay for it. You should be able to negotiate a partial refund.

The company may take the position that he paid for it and that’s the end of the story. If they say no, then I would start action against them, and you’ll have to decide if that’s really worthwhile.

Dear Bruce: Iam61 years old, single (divorced) with no dependents. The balance on my mortgage is $58,500. I pay $408 a month. There is approximately $15,000 in equity. I have $117,000 in my checking, $303,400 in stocks/IRA and a monthly pension of $337. My income yearly is around $50,000 (commissioned sales rep).

I want to get the house paid for, so I was thinking of applying my monthly pension payment to the principal balance. I normally put it in my IRA. What are your thoughts? — M.P.

Dear M.P.: I understand you want to pay off your mortgage, but in my opinion, you should take the monthly pension and invest it in a good, strong stock portfolio that pays between 2 percent and 4 percent in dividends. This way, you’ll have the money you would have used to pay the mortgage down in case it’s needed, but in the meantime, it will be earning a return.

You have approximately $420,000, which is certainty not insignificant, but on the other hand, if it earns 6 percent, that’s only $25,000 a year, which doesn’t even come close to your income of $50,000. That having been said, I would also invest at least 10 percent of your income until such time as you’re no longer employed. I certainly wouldn’t stop working at age 62. You simply don’t have enough money to justify that.