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Couples should not make debt a wedding vow

When I can, I'm happy to answer some of the many questions I get in my mailbox. So here are some recent reader questions and my responses:

Question: I am a 26-year-old engaged homeowner with an excellent credit score but I have $18,000 of credit card debt between my fiancee and myself. We are trying to plan a very conservative wedding ($10,000). We want to be free of credit card debt by the time we are married in May. Do you think a home equity loan is the best way to go?

Answer: Lots of people use the equity in their home to pay off credit card debt. Personally, I think it's a dangerous financial move. You take unsecured debt (credit cards) and replace it with secured debt (a loan backed with your home.)

Unless both of you have changed your spending habits and you're sure you won't get into credit card trouble again, don't jeopardize your house. And even if you get the home equity loan, you won't be out of debt by the time you have planned to be married. You would have just transferred the credit card debt someplace else, albeit at a lower interest rate.

Q: I have student loans of $13,000 that I already consolidated at an interest rate of 8.25 percent so I can't take advantage of the new lower rate loans. Would it be wise to move this debt to a credit card where I can get 2.99 percent or 3.99 percent? I would have to ask that my credit limit be raised to accomplish this. Would this hurt my credit rating?

A: It may seem logical to move debt carrying a higher interest rate to something with a lower rate. But in this case, transferring $13,000 to a credit card is not a smart move. Sure, the credit card company is offering a low rate -- for now. Just because you have a credit card with a fixed rate doesn't mean it will stay that way. Those low rates often come with loopholes. Credit card companies retain the right to raise your rate for any number of reasons. For example, pay late, even once, and on any of your cards and that low rate could jump to double digits.

And if you max out your credit limit to accommodate the student loan debt, yes it could lower your credit score. Generally you should only use about 50 percent of your available credit on any card.

Q: My son, a senior in high school, is interested in joining an investment club. Can you offer any suggestions?

A: I think it's wonderful that your son is interested in investing. To find out more about investment clubs, contact the National Association of Investors Corp. (NAIC), a nonprofit organization of investment clubs and individual investors. The group's Web site is www.better-investing.org.

NAIC can't help your son find a club to join but many NAIC chapters post a list of clubs looking for members and of members looking for clubs.

Q: On Christmas Eve, I was invited to my best friend's home where we exchanged gifts. I had spent the week before Christmas searching for the perfect gift for her. I finally found a beautiful blouse that I knew was just her style. She wore it that evening. Her gift to me was a can of Maxwell House coffee that had expired in August. I am so hurt by this and I don't know if I should tell her how I feel. It makes me wonder how important our friendship is to her.

A: How sad that the exchange of gifts often can cause such grief. But yes, you should tell your friend how you feel. If this person is such a good friend then I think it's OK to say (or joke), "What was up with that expired coffee you gave me for Christmas? I love coffee but I would rather have some that is still good to the last drop."

The important thing here is to deliver your lines in a lighthearted way because friend or no friend, no one owes you a gift - - even a bad one.

Maybe there is a good reason your friend gave you an expired can of coffee. Perhaps she didn't know it had expired. Maybe she wasn't expecting to exchange gifts so she just looked around for something - - anything -- to give you. Or maybe she was just being thoughtless. In that case, it's understandable if you considered ripping the blouse you gave her right off her back.

But you suppressed your anger at the time. Good for you. Whatever her reason for the bad gift, you should base your friendship on stuff that matters. Has your friend been there for the important events in your life? Has she talked to you until the wee hours of the morning after a bad breakup? Don't throw a good friendship away because of a bad gift.

Listen to Michelle Singletary discuss personal finance every Tuesday on NPR's "Day to Day." To hear her reports online go to www.npr.org. Readers can write to her c/o The Washington Post, 1150 15th St., N.W., Washington, D.C. 20071, or at singletarym@washpost.com.