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SonHelp asked..

"I am selling my mother's house and expect to get around $60,000 for it to finance her stay at an assisted living home. The cost to stay at the home is $1300 per month and she gets only $500 per month SS. What's the best way to invest the proceeds from the sale of her house to attempt to cover the remaining $800 each month without exhausting the entire $60,000?
Stocks or Mutuals but short-term cap. gains? Short term T-bills or bonds? CD's and/or money markets? Show me the way. Thanks "

I wish I had better news.

To generate $800/mo ($9600/yr), you'd need to get a steady return of 16% (9600/60,000) which is not going to happen with CD's, T-Bills, or other low risk investments. Higher returns of stocks is too risky for this and to get a steady 16% with any investment is pretty close to impossible.

If you can invest the $60K in CD's at 6% and you take out $800 per month, then the $60K would be whittled to zero in 7 years and 10 months.

I hate mentioning it but you could look into a single payment annuity to see what they'd payout. Of course, with such an annuity, there would be nothing left at her death. A lot depends on your mother's age and her life expectancy.

I wish the news was better. If I can be of any other help, you can email me.


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