Kiplinger\'s Personal Finance - 04.2020

Entitlements are earned.

I wish everyone, including

you, would stop referring

to Social Security and

Medicare as “entitlements”

(“From the Editor,” Feb.).

There are plenty of real en-

titlement programs, such as

government housing, food

stamps, unemployment,

child support, Medicaid

and other welfare programs.

Social Security and Medi-

care recipients have been

contributing during their

entire productive life and

are therefore owed by the

government. I do not con-

sider those benefits to be

handouts or freebies.

R. KUSTER

VIA E-MAIL

Kiplinger staff economist

David Payne responds: All

non-401(k) direct benefit

pensions are “entitlements,”

which include both Social Se-

curity and private pensions.

The word means payments

that the recipient is entitled

to by virtue of having worked

under an employment con-

tract. Technically, all Social

Security and Medicare pay-

shocked that I had to pay an

outlandish commission to

liquidate it. There is a fee to

sell, as well as a charge per

share assessed to each share

sold. The sales commissions

and transfer fees (to a bro-

kerage account) are unbe-

lievably high, especially in

today’s zero-commission

climate.

RICK OCCHIALINO

VIA E-MAIL

You failed to mention the

site http://www.feex.com. It ana-

lyzes what you have and

recommends lower fees and

higher returns on similar

investments. I have saved

over $2,000 in fees over the

past two years on a modest

portfolio, and my friends

have, too.

STEVE RAMM

PHILADELPHIA

Robo rebalancing. My con-

cern with robo advisers is

the constant monitoring

and rebalancing of the in-

vestment mix (“The Right

Robo for You,” Feb.). Rebal-

ancing would be fine in a

normal market. What hap-

pens in a volatile market?

If the market rises sharply,

stocks increase and then

are immediately sold to buy

bonds. Future gain in stocks

is curtailed. If the market

drops, bonds are sold to buy

stocks that are dropping,

increasing the total loss by

chasing losses with good

money. There should be a

way to stop or reduce this.

MICHAEL PREZGAY

EUPORA, MISS.

Timeshare solution. My hus-

band and I have owned a

timeshare given to us by

a relative for many years

(“How to Get Rid of a Time-

share,” Nov.). We tried sell-

ing it, with no luck—and

the timeshare exit company

fees are very expensive. Our

timeshare is with Shawnee

in the Poconos, which is

now owned by Wyndham,

and the company has a pro-

gram to take timeshares

back into their inventory. It

took a couple months from

the initial phone call until

we received the final letter

indicating the completion

of the transaction, but it

worked, and we will no lon-

ger have to pay the annual

maintenance fees.

JUDY BOURQUE

VALHALA, N.Y.

CONTACT US

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Tax Law Winners and Losers

I know some of your readers have said they have seen a reduction

in their federal income taxes because of the new tax law (“From the

Editor,” Feb.). However, I have experienced a significant jump in my

federal taxes, and so have some of my acquaintances. In Georgia, the

state income tax is 6%, and our tax deduction on state and property

taxes is capped at $10,000. So for 2019, my wife and I had to donate

an additional $35,000 to charity just to keep our federal tax at the

same level as the year before. (We ordinarily donate 10% of our in-

come to charitable organizations every year.) The new tax law cre-

ated some winners but also some losers. And perhaps the losers

don’t want to advertise it.

A.L.

AT L A N TA.

ments are “earned,” because

recipients must qualify by

working 10 years for pay.

Pesky fees. You always hear

that dividend reinvestment

plans (DRIPs) are a good

way to acquire and increase

ownership of stock (“How

to Beat Pesky Fees,” Feb.).

Recently, I sold my position

in a stock I participated in

for over 15 years. I was

READER FEEDBACK

Q READER POLL

04/2020 KIPLINGER’S PERSONAL FINANCE 9

How do you use

the funds in your

health savings

account?

38 %

36 %

27 %

Long-term saving

Paying current medical bills

Combination of current

bills and long-term saving

To learn more about health savings accounts, turn to page 43.

SOURCE: POLL SURVEYED 57

KIPLINGER’S

READERS.

FIGURES DO NOT ADD UP TO 100% DUE TO ROUNDING.