I managed my grandmother's portfolio of 95% fixed income holdings from about 2005-2011 when she passed on at the ripe young age of 88.
Starting even in 2006, as rates started dropping, I discovered the callable CD market with the "death put/estate" feature.
The CDs offer richer rates, but in return, are callable at the option of the issuer after a certain date. But, many CDs issued also have the death put/estate put feature, whereby when the original CD owner passes on, the heirs can either redeem it at full par, or hold onto it (or sell it in the open market).
If someone is up in years, and probably has maybe at most 5-8 years left, it wouldn't be a bad idea to ladder a good chunk into 10/20/30 year CDs offering higher rates to begin with...and if they're callable, they'll likely offer even slightly higher rates. Then, when she passes on, even if rates have gone up substantially and the market value of her CD has dropped, you can exercise the estate put and redeem it at full par.
One caveat: usually, each prospectus will detail limits that each issue can redeem due to the estate feature each year (usually expressed as a % of the total outstanding issue...such as, no more than, say, 1% or 3% of the outstanding CDs can be called in any one year with the death put feature).
I loaded up my grandmother's portfolio with about 28 different callable CDs, and not a single one had any issues with using the death put feature resulting in maxing a redemption covenant and having to wait a year, although your own experience may vary.
There were even some more exotic CDs that had rich teaser rates for the first 6 months or 1 or 2 years, and which had multipliers afterwards (like 7% or 8% guaranteed the first year, and afterwards the rate was 4x the spread between the 30 year and 2 year Treasury bond rate). These days it's very slim pickins, but there are some juicier rates out there if you think the death put feature will be exercised in the not too distant future, so you can take a chance with a 20 or 30 year CD.
The CD broker I started her out at was FISN (
CD Rates, CD Alternative Rates, Money Market Rates, IRA Investments :: FISN). The broker we were dealing with left to join RBC Wealth Management right around the time she passed on, and we then began liquidating everything. I could give you the broker's name at RBC over a private message if you want.
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