A revealing article appeared not long ago in a business website, titled “Invest Your Cash for a Steady Flow.” Its author compared two routes by which retirees might invest for a steady flow of income. The methods offered: an insurance company annuity or a mutual fund’s payout fund. Both techniques are highly promoted by their respective industries. Unfortunately, each presents notable defects that a thoroughly competent financial analyst specializing in retirement planning could clearly spell out.

The annuity route doesn’t entice me. That industry specializes in high fees and burdensome withdrawal penalties. In addition, the initial cost of the annuity is lost to your forever. Furthermore, the payments you receive become worth relatively less over time. In general, the annuity is not a device by which you’ll grow old in comfort.

The mutual-fund industry’s alternative, referred to as “managed payout” or “target distribution” funds, introduces uncertainties of its own. Though the management fees are less and what you invest doesn’t cease to be yours, there’s no assurance of a predictable cash flow. If the fund managers guess wrong in their investment decisions, you may find your income stream reduced to little or nothing . . . with no recourse.

If you now expect me to recommend a technique for a predictable annual return of eight percent or greater, I must disappoint you. Though I generate this for myself, it’s from an active and time-consuming business, not passive investment. Most persons are neither inclined to nor capable of involvement of this sort. Unfortunately you’ll earn little or nothing from bank savings deposits, money market accounts or certificates of deposits. And by the way, avoid like the plague promoters of programs that offer spectacular returns, sometimes up to 30 percent per month. No good comes of that.

So what do I suggest? Your best bet will probably be a mixture of U.S. Treasury notes, short or intermediate-term high-grade corporate bonds, and stocks which pay respectable dividends. Admittedly, you’ll not beat the world in this way, but neither will the world beat you. The advantages are that fees and costs are minimal, risk is slight, and your cash flow is easily predictable. And of equal importance, you need retain no financial advisor to supervise your selections. It’s a simple program you can learn to operate, with far less to go wrong than most investment avenues you’ll be offered.