Credit Card Debt, Retirement and Ex-Wives

Jane Bryant Quinn is a personal finance expert for AARP.

En español l Q: I have some very old credit card debt. Do I have to repay it?

A: Morally, yes. Legally, there are statutes of limitations, after which a creditor can no longer sue you. Lawsuit windows generally run from three to eight years, depending on your state. Collection agencies will call for many years more if they think they can get you to pay at least something, says Gerri Detweiler of Credit.com. Unpaid debts stick to your credit history — and ding your credit score — for seven years.

Q: How much do I need to retire?

A: As much money as you can get! Here is the rule of thumb in three steps. 1) Estimate a retirement spending budget for the year.

2) Add up the income you'll receive from Social Security and other known sources. 3) Assuming that there's a gap between your expected income and your cost of living, multiply the gap by 25. That's your savings goal. If you're short, keep working or lower your budget.

Q: My husband's will names me as beneficiary of his individual retirement account, but he forgot to remove his ex-wife's name from the beneficiary form. What can I do?

A: In most states, you're stuck. Whoever is on the beneficiary form gets the money — even if it's obviously wrong and unfair. You'll have to live with this permanently. Wives are better protected in community property states. In California the law revokes the right of an ex-spouse to IRA assets, even if she is still named on the form, says divorce attorney Sharon Mah of San Rafael, Calif. To win a claim, she would need "clear and convincing evidence" that her ex-husband meant her to have the money.

Jane Bryant Quinn is a personal finance expert and author of  Making the Most of Your Money NOW.

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