Income funds or annuities?

[CTyankee]

Hubby and I are 69 and 70 respectively. We are both retired but he is starting a part time job next month. We need more income and have two choices before us: invest in income funds with greater return but more risk or annuities that have a lower return but are guaranteed.

Given the stock market these days, are income funds so risky that we are putting our money at an unconscionable risk or is it worth the better return (we are looking at 6% versus 5% for the annuities)?

We are planning to sell our house and downsize to a condo within a year's time, to reduce our costs.

I'd love to hear from folks having the same dilemma...

[leftofcool]

1. We have both and I would say the annuities right now

You may get that 1% more but the stocks are a bit risky right now. We took some of our funds out to invest in some land, mostly because we wanted this particular piece of land and because land is always a good resell if we need the money later on. hopefully others will weigh in with a different view point.

[CTyankee]

2. Good luck on the land thing. We've been trying to sell acreage in a prime

resort area for a year now with no luck.

My accountant likes annuities, too. And I have 3 already which are great. I took a huge loss when GM collapsed, even tho I had a good run with it for a while. I guess you enjoy the good times but have to take the bad as well...

[leftofcool]

3. We bought 73 acres with caves, running streams

and a buttload of wild life on it. I plan to use it soon for a gourd and herb farm. Will only sell it if I have to.

[CTyankee]

4. That's great. Sounds wonderful.

We actually inherited the land so all that needs to be paid on it are the taxes. But there is no need for it, given our situation...

[marybourg]

5. You will not get very reliable or knowledgeable financial advice on a

a political discussion site. The only site I would ask a financial question at is at bogleheads.org. There they will ask a lot of pertinent questions before giving you a reasoned answer. Which you're not getting here. IMHO.

[CTyankee]

7. Thanks for the link I will log onto it. However, I must say that i was

really asking for people's experience with income funds/annuities. I wanted to know their own experiences.

I have enountered your objection in the past. However, I am a convert to believing in The Wisdom of Crowds.

[Scuba]

6. Put your cash in a coffee can and bury it in your back yard....

...or risk losing it through some scheme you will NEVER understand.

[quiller4]

8. I have both. My securities did better than 9% last year and that

was the first year that my CREF account did so poorly. My annuity does about 6.25. Even though I retired in 2006 at 55 I have more directed toward my security account.