The best approach depends on whether you're the type of person who prefers one large trout -- or a constant stream of minnows.

Generally, annuities are not your best investment if your goal is to make the most of investment returns. Annuities typically have hidden costs -- often high hidden costs -- that eat away at your return. You can usually do better by putting together a diversified portfolio of stocks and bonds and cash.

What annuities offer that people find attractive is a well-defined stream of income. That security is sometimes worth more in peace of mind than increased returns.