Targeted-Distribution Fund

The point of saving for retirement is to have cash when you're older. You put money into all those investments over the years. Now, finally, the cash goes the other way. You get to start receiving some checks.

Enter: the targeted-distribution fund. It's an investment vehicle dedicated to sending you those checks.

The details vary from fund to fund, but these setups allow you to remain invested in the market while still receiving the cash you need to pay for retirement stuff...like rumba lessons and fishing tackle. The money that comes from these funds isn't guaranteed (as they would be with an annuity). However, unlike with an annuity, you continue to have upside potential. You can still earn a return when the market goes up (though you can still lose money when it goes down).

Meanwhile, you receive distributions on a regular basis, cash paid out of your account that you can use for retirement expenses (hearing aid batteries and joint liniment).