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Hi g11,

I'm a retired teacher who has the same problem as that of your parents, though mine is not inherited but in my IRAs.

With the terrible returns on FDIC accounts, and treasuries too, it is possible that their returns will not be greater than the rate of inflation, leaving them with a net loss.

I have been using some of the Nuveen inflation adjusted ETFs like JFR Floating Rate Income Fund. Right now it is selling at a small premium to its NAV but has historically been about 3% below. Another ETF with a floating rate is AEB. You can look at these and other preferred stocks on , a great site.

There are also some good Preferred stocks out there such as those issued by utilities such as Alabama Power, as well as the common stock of the parent, Southern Company(SO). It's yielding 4.3% and is a very highly rated company. See Morningstar's SO page. Ex. Southern Company also announced today a regular quarterly dividend – including an increase of 1.75 cents per share on a quarterly basis – of 49 cents per share, payable June 6, 2012, to shareholders of record as of May 7, 2012. This marks 258 consecutive quarters – dating back to 1948 – that Southern Company will have paid a dividend to its shareholders.
The Motley Fool has regular articles on high dividend paying stocks, both domestic and foreign such as today's The Top 5 Dividend Stocks You Don't Own

MFool has a newsletter called "Income Investor" that offers advice along the lines you want. There are others such as those offered by and Forbes/Lehman .

I hope this may be useful to you and to your parents.

Best wishes,
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