DEAR BRUCE: I'm going through another eviction process; this will be the second time in the last two years. I've always made the tenants sign a lease agreement and pay a security deposit before moving in. I've also made them show me paycheck stubs or W-2's to make sure they can afford to live there. It seems like I get screwed on the deal eventually. What are the do's and don'ts of leasing rental property? -- J.B., Pensacola, Fla.
DEAR J.B.: Most amateur landlords, and I include myself in that category, have the same experiences and lament them. A landlord once told me that a lease is only as good as the parties who have signed it. There are a ton of deadbeats out there. You have tried to do your best, and I salute you for that.
There is one thing you have overlooked that has worked at least partially for me. You can find services on the Internet that charge $40 to $50 to do a background check on your prospective tenant.
Now we tell prospective tenants that they will pay a $50 fee upfront. If they stay for the length of their first lease and meet all of the responsibilities, the $50 will be refunded to them.
At that intersection, many people respond, "I'll think it over," and what they're thinking is their credit is not as worthy as they are telling you and they're going to get stuck for the $50 for nothing. This has helped eliminate many problems for us.
DEAR BRUCE: I don't think you should make a blanket negative statement about annuities. I've been in insurance business marketing since 1964. I've owned annuities during most of that time, and I've never been disappointed in them. My customers have never been disappointed in them.
Like all other financial instruments, they have a time and a place and should be considered by anyone at some point in their life. There is no financial instrument I know of that is correct in every situation.
I would make the following points in answer to your column:
* Paying a lifetime income is not annuities' only method of distribution. There are way too many other choices even to mention them here. And distribution is not their only function; savings is an important factor.
* You criticized annuities' withdrawal penalty as "paying for the privilege of getting to your own money." That's not any different from a multiyear CD. Plus, you can usually draw 10 percent after a year with no penalty, or draw interest only with no penalty. Can you on CDs?
* You made no mention of the fact that annuities grow tax-deferred, so the annuity owner is using the government money to earn interest.
* You made no mention that the federal government is even recommending annuities now per the Treasury Department.
* You suggested investors could do better elsewhere but didn't say where.
* Annuities consistently outperform CDs on interest rates.
The more I think about this as I write, the more upset I am that a person who is a nationally syndicated financial adviser should give this kind of information as if it's completely gospel and objective, when it really isn't. I think that out of fairness, you owe a retraction on this to the general public. -- H.H., Storm Lake, Iowa
DEAR H.H.: I appreciate you writing. I agree with some of your comments but would have a difficult time endorsing others.
I'm sure you will agree that many national writers and commentators have not been enamored with annuities. I am not making a retraction, but I am sharing your thoughts with my readers. Thank you for taking the time to write.
Send questions to firstname.lastname@example.org or to Smart Money, P.O. Box 7150, Hudson, FL 34674. Questions of general interest will be answered in future columns. Owing to the volume of mail, personal replies cannot be provided.