Every day, I open my inbox to find letters from my dear readers — questions, stories and lots of love, too. I look forward to answering many of these questions in future columns, like today's!
Dear Mary: My husband and I are very close with our next-door neighbors. Our children play together all the time, and we frequently spend holidays together. About a month ago, they asked us if we'd be interested in buying a new, state-of-the art lawn mower with them. Neither one of us could afford it on our own, so they figured why not split the cost and share the rewards? My husband is all excited, but I'm a little nervous. What happens if we have a falling out with them, or one of us decides to move? Is this a good idea? — Bonnie
Dear Bonnie: I think it's a great idea! And you will avoid all kinds of misunderstandings and problems down the road if you have a written agreement from the start. Who pays for repairs and maintenance? Where will the mower be stored? Who buys the gas? What are your buyout terms should one family move or want out of the deal? It wouldn't hurt to come up with a plan if another neighbor asks to borrow the mower from time to time, too. Believe me, it will be much easier to talk about these things now, rather than later.
Dear Mary: I recently purchased a new heating, ventilation and air conditioning system for my home. The sales guy put a lot of pressure on me to buy into one of those extended warranties. I always thought that those things were just ploys to get more money out of customers, so I passed on it. But my dad says it can save me a lot of money in the long run. Did I make a mistake? — Andrea
Dear Andrea: I think you exercised very good judgment. Extended warranties represent quite a commission windfall for most salespeople, which may explain why you got the hard sell. Besides, when was the last time you exercised your rights under any warranty? Unless you are purchasing an item you plan to expose to extreme use or is notorious for developing problems (a treadmill or laptop computer, for example), my advice is to just say no to third-party extended warranties. Statistically, if an item is going to fail, that will happen in the first few months when the manufacturer's warranty is in force.
Still nervous? Do this: Create your own extended warranty account by opening a savings account devoted to your HVAC system, and deposit the amount you would have paid for the extended warranty. If the system fails after the manufacturer's warranty expires, you'll have the money to make the repairs. And if not, you'll have a nice nest egg.
Dear Mary: The other day, I was filing copies of this year's tax return when I noticed that I had made a mistake adding up some deductions. When I told my brother, he warned me that I'd have a high risk of being audited, so now I'm in a panic. Is there any way to fix the goof and avoid hefty penalties? — Margo
Dear Margo: Relax; you have nothing to worry about. The IRS has created a special form to correct a return, which should tell you that filing a correction is a common occurrence. Go to the IRS website to get Form 1040X, or call (800) 829-3676 to receive it by mail. This form is simple to complete. The fact that you file an amended return will not in itself increase your chance of being audited. It's the nature of the change that could raise a red flag. But in your case, a simple mathematical correction should not cause you or the IRS a bit of concern. By the way, you have three years from the due date of your return to amend it.
Would you like more information? Go to EverydayCheapskate.com for links and resources for recommended products and services in this column. Mary invites questions, comments and tips at EverydayCheapskate.com, "Ask Mary." This column will answer questions of general interest, but letters cannot be answered individually. Mary Hunt is the founder of EverydayCheapskate.com, a lifestyle blog, and the author of the book "Debt-Proof Living."
Photo credit: Counselling at Pixabay