Q I am 88 and have $100,000 to invest. Our house is paid for, and my wife and I would like to use the interest this money would produce for living expenses. What kind of investments would you suggest?
R.W., DeKalb, Ill.
A "It sounds as though you need investments producing income and growth," says Terry Nager, president of Southern Capital Services Inc. in Daphne, Ala.
Mr. Nager suggests you invest in five or six no-load mutual funds representing small-cap, mid-cap, and large-cap issues, plus international stocks. The funds could be both value and growth oriented, although more on the value side, he says.
Look for funds with a manager that has a solid track record, Nager says. Chicago-based fund tracker Morningstar Inc. (www.morningstar.com, 800-735-0700) is a valuable resource for this information.
Finally, he says, if the amount you mention represents all your cash, you might want to put $5,000 to $10,000 in liquid money-market or bank CD accounts.
Q Can you explain how "stop loss" orders work? How long are they in effect once placed? I'd like to start using them to protect myself when a stock crashes.
K.G., Campbell, Calif.
A A stop-loss order automatically sells a stock to protect your profits from market downturns. But when your stock hits the designated "sell" price, the sale might not be executed until the next trade, which could be below the price you've targeted.
Finance specialist Lorayne Fiorillo suggests in her book "Financial Fitness in 45 Days" that you use a stop-limit order instead. This way, a stock will only sell at the specific price you set - not below or above it. Both types of orders usually are in effect until you cancel them.
Q I have subscribed to both Part A and Part B of Medicare since 1984. In 1991, I purchased private health insurance, but didn't cancel Part B of my Medicare until Feb. 2000. I feel it's not fair to have paid for Part B all these years. Will Social Security refund the fees I paid when I had double coverage?
A.Y., San Marino, Calif.
A "No," says a Social Security spokeswoman. You had 60 days in which to drop Part B. You did not, so in effect, you were covered under B right up until the time you dropped it this year.
To discuss the matter further, call Social Security at 800-772-1213.
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