mmnt62[at]yahoo.com wrote:
- quote -

The stock market is inherently volatile and I believe you should never
put money into the stock market that you must have available to spend
in a 5 to 10 year framework.

Your father needs to spend $2,332 of his savings each month on his
assisted living facility ($3,500 less SS of 1,168). At that burn rate
the $282K will last 120 months, or 10 years, even if you earn 0%
interest on it, i.e. if you earn no interest you have a half decent
chance of making it work.

Now, lets say you put the whole wad in a stock based mutual fund, and
there is another 30% downturn like happened a few years ago. Then the
math becomes 2,332/(282,000*.7)= 84 months or 7 years. What is Plan B
if this happens? If you are investing money you need to spend in the
medium term (5-10 years) in the stock market you have to have a Plan B
that you can live with in the event the market slumps.

Andy

Stock mutual funds are not recommended in situations where you need the
funds within 5 years. Go with the laddered CD approach. If you ladder
in 6 months intervals, it doesn't take that much time.

You could look into Single Premium Immediate Annuities. (SPIA) Look at a
company like Golden Rule, that specializes in these situations. The product
I'm thinking off is called Immedicare. I've know people who have bought
these and then went to the facility and negiotated for the direct payment,
they get protected from furture rate hikes.

Good luck

mmnt62[at]yahoo.com wrote:
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You may want to consider the use of an ANNUITY. The PRIMARY function
of the Annuity Contract is to provide an INCOME that the Annuitant Can
NOT OUTLIVE. Since it appears that you require a steady stream of INCOME
of approximately $2,400, I do believe that a properly written Annuity could
work very well.
Cal Lester CLU

My dad is in his mid-seventies, a widower, and had suffered a stroke a
few years ago. Since my mom's passing, he's been living in an assisted
living facility at a cost of roughly $3500 per month. Most of his
savings, $300,000, came from sale of his home. He also receives $1,168
per month is social security. Right now, about $282,000 remain of his
house money and it is presently invested in a money market fund.

I'd like to know what would be the best investment choice(s) for my
dad's house money to pay for his assisted living care given his
situation? My siblings and I estimate that dad will live another five
to ten years and we think something riskier (and higher yielding) than
a money market would be the way to go; but nothing too risky. A CD
ladder strategy was suggested to me by a broker but my sibling who
takes care of my dad's money doesn't have the time to manage a CD
ladder approach. My dad's brother is very strongly suggesting that
about $260,00 of the $282,000 be invested in the Franklin Income A
mutual fund (FKINX).

- quote -

in the conservative allocation fund category. It is, however, a load
fund and it's Morningstar Risk Rating is ranked as high. The Vanguard
Wellesley Income fund (VWINX) for example, seems to be a safer bet as
it is a no-load fund with a lower beta than the Franklin and has lower
fees too. To me the Vanguard fund seems to be a better choice than the
Franklin fund over 5 to 10 years but I am no expert and that's why I
would like your suggestions and opinions.

If indeed mutual funds are the way invest for my dad's situation, which
of the above two would be the best? What other mutual funds would be
very good as well? And what other investment vehicles aside from mutual
funds might be solid choices?

Any suggestions that you may have are appreciated. Thank you in advance
for your help. I look forward to your responses.

Rich