I don't want to sell my stocks. I don't know of any way to get an investment that makes regular interest payments that are taxed at the lower capital-gains rate. Many older investors who need investment income to live on look for the best rates they can get on interest-paying investments such as CDs. Or they buy stocks that pay high dividends, such as those in utility companies. The problem is that interest rates and many dividend payments are very low these days.
Stocks offer higher returns for investors who can ride out the downturns.
To do so, they feel, would be like buying groceries by selling off pieces of the family farm. But this can backfire if it means you put all your money into CDs, bonds, or other income-producing investments with lousy returns. With a stock or stock fund, you might be able to trim the tax bill further by selling the shares you had bought at the highest prices. Those shares would have the lowest capital gain, and thus the lowest gains tax. There's a good chance those would be among the cheapest shares you'd bought, so they would incur the highest gains tax.