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Subject:  Re: Variable Annuity vs Bond Fund Date:  10/6/1999  9:41 AM
Author:  pauleckler Number:  14273 of 88532

There is an annuities board in the Speakers Corner folder where these matters are discussed. A search on the term annuity will find many prior threads.

A big problem with the variable annuity is that in most cases the annuity contract provides payments for the life of your mother or for a fixed minimum number of payments, but on her death no assets remain. If the same money is in a mutual fund or bonds, her income will be lower, but her heirs will inherit most of the principle.

Rather than bond fund, you should take a look at laddered maturity corporate bonds. They are discussed on the Bonds and Fixed Incomes board in the Investors Roundtable folder.

The usual Foolish strategy would be a combination of laddered maturity bonds and index mutual funds.

Best of luck to you.
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