QUESTION: My friends have been urging me for years to join an auto club, but I have never done it because I thought they were more expensive than they were worth. But when my car stalled on the freeway a few days ago and it took more than two hours to get a garage to help me, I decided that friends were right all along. Do you know whether all auto clubs charge about the same and offer about the same service? Are there big differences worth checking out?--K. V.
ANSWER: By all means, do some shopping around. They all offer the same basic services, but some provide more assistance then others and the charges aren't uniform. Membership can cost as little as $15 per year or as much as $100, and some services charge extra whenever you call on them for help.
Before you start shopping, ask yourself a few questions about your driving habits and financial and convenience needs. Do you want a club that will handle virtually all of the calls and paper work for you when something goes wrong with your car? Or do you prefer to use your own mechanic? Some clubs insist upon calling a garage of their choosing, and others will charge you extra if you insist on using your own mechanic.
Would you prefer to pay a higher annual fee in exchange for paying nothing or only a small part of the towing or repair fees when you call on the club for help? Or are you looking for the club with the cheapest membership cost? Often, the clubs that advertise a small annual fee--$15 or $20--will cover only a fraction of the cost you'll have to pay when your car has to be towed long distances.
Do you frequently travel long distances from home or in remote areas far from a garage capable of fixing your car? If so, be sure to inquire about special deluxe plans that will cover expensive towing charges.
To get you started, here is a list of some of the most popular auto clubs: American Automobile Assn., U.S. Auto Club, Cross Country Motor Club, Allstate Motor Club, Amoco Motor Club and Montgomery Ward Auto Club. All have toll-free numbers, available by calling 1-800-555-1212.
Q: I recently heard someone use the term "red herring" in discussing stocks. I can't imagine how the usual definition could be applied in this case. Do you know what might have been meant?--L. L. A.
A: On Wall Street, a red herring is the preliminary prospectus that an underwriter of a new issue of stock gives to prospective investors.
You are right: The traditional meaning of red herring--something used to divert attention from a basic issue--doesn't apply here. Rather, the name apparently was taken from the red ink that is used in printing the covers of such prospectuses.
Q: I am worried about my children getting stuck with big tax bills when I die. So, I was talking to my neighbor about it the other day, and he suggested that I look into something called flower bonds. He didn't know anything about them other than that he had heard they were worth checking out. Do you know what they are?--E. G.
A: Flower bonds, also known as "estate tax anticipation bonds," are really just ordinary Treasury bonds while the owner is living. But when he or she dies, the bonds are used to pay off estate taxes.
They are usually bought at deep discounts to the bond's face value. So, you might buy a $50,000 flower bond for $25,000 and when you die, it will be used to pay off $50,000 worth of estate taxes.
Why the name "flower bonds?" People send flowers to funerals.
Debra Whitefield cannot answer mail individually but will respond in this column to financial questions of general interest. Do not telephone. Write to Money Talk, Los Angeles Times, 780 Third Ave., Suite 3801, New York, N.Y. 10017.