Help for mom…Background:My mother, who is mentally ill, recently received a $89,000 settlement from a work-related accident. Right now, at age 56, it looks like she will not be able to work again & that this money will have to last her until age 62 when she can receive Social Security. She is applying for Social Security Disability Insurance, but has been rejected twice. She will have an SSDI trial hopefully within a month. However, she is upset since the trial has been postponed twice over four months. Question:She wants to invest 78,000 in something that will give her a relatively stable income. I just starting to learn about investing & do not want to make a mistake with my mom's money. I only know one person who is knowledgeable about investing, but I do not want to rely only on him for information & opinions. We have visited three financial planners. One, who works for Prudential , suggested we invest in an annuity. We have already rejected this idea because it seems expensive & does not keep up with inflation. However, it would pay $525/month. The second planner, who works for American Express, suggested bond funds that have bonds ranging from AAA to BBB. He estimates that his recommendation would pay 6.5 to 7% return. I estimate that this would provide about $420/ month. However, each fund is a front load fund of 4.75%. The last planner, who works for our local bank, suggests that he invest in bonds directly for us. He estimates that he could get about a 6% return. I think it would provide about $400/ month. He charges .005% or 50 cents per 100. My friend suggests that we invest the money into a bond fund ourselves. Specifically, Vanguard bond funds such as the Total Bond fund, GNMA, & Short-term Corporate. There are many different returns listed on the Vanguard web site & Morningstar, so I am not sure what kind return to expect. However, I think that it would be about the same as the others. However, their main benefit is the low charge. Which option do you think would be the best for someone like my mom? Personally, I like the Vanguard fund idea, but as I said I am new to this & nervous about making a mistake. What should we consider before making this kind of investment? I would appreciate this forum's ideas on my dilemma. Thank you very much for your help.Regards,Chris
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