Ask Our Experts
By: Compiled by Carole Fleck; Source: AARP Bulletin Date Posted: 2006-10-12 12:53:00-04:00
The AARP Bulletin 's Ask Our Experts column provides answers to important questions affecting older Americans. Read below for this month's column, or review our archive of previously published questions and answers sorted by topic. (Note: Recent news or changes to regulations may affect the guidance offered in this previously published column.)
Submit your own question to the Ask Our Experts column via our easy-to-use online form.
Q. My broker wants to sell all my stocks and buy other stocks. I'm concerned he's trying to churn my account to earn commissions. What should I do?
A. Churning occurs when brokers buy and sell clients' stocks frequently to earn commissions, not because it's in the clients' best interest. Experts say investors lose billions a year to churning.
If you don't know your broker well (and even if you do), check out his license and record by contacting your state securities regulator. (Go to the North American Securities Administrators Association websitefor the regulator in your state.)
Next, ask your broker why he's suggesting these transactions and exactly how much he'll earn by making them. Check out what the tax consequences will be. Also, consider getting a second opinion from another financial adviser. In the end, if you suspect that your broker is not acting in your best interest, take your business elsewhere. You can also file a complaint with your state regulator. —Expertise provided by Sally Hurme
Q. I'm 61 and disabled, drawing Social Security disability benefits. My COBRA health insurance from my last job expires soon. No one will insure me because of my chronic asthma. Will I qualify for Medicare at my age?
A. Yes. You'll automatically be enrolled in Medicare once you've received disability benefits for 24 months.
In the interim, you may be able to extend your coverage under COBRA (the Consolidated Omnibus Budget Reconciliation Act, which provides for continuation of group health care benefits for 18 months). You can get an additional 11 months if Social Security administrators find that you were disabled within the first 60 days of your COBRA coverage period. To qualify for the extension, notify your COBRA plan administrator of this finding.
If you are not eligible for the COBRA extension, you will have a 63-day period—before your COBRA coverage ends—in which you can buy an individual policy and insurers cannot turn you down, regardless of your health. Premiums vary and could be expensive.
For more information visit AARP.org. —Expertise provided by Geraldine Smolka
Q. Can a foreigner who is married to an American citizen receive his company pension after his death?
A. Yes, she can receive survivor benefits as long as she was designated as the beneficiary. For information on how pension plans work, go online to the Pension Benefit Guaranty Corp., the federal agency that insures most defined benefit plans in the United States, at www.pbgc.govand click on "Workers &Retirees." —Expertise provided by John Turner
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