Checking the website, the expenses for the managed payout fund are 0.42%, as opposed to 0.05% for their index funds. That's $370 more for every $100,000 you have invested, or $1110 per year for in fees for your $300,000.
I guess the advantage over an index fund is that it's more conservative — it certainly has lower gains that an index fund over the last decade, which I imagine will theoretically be balanced out by smaller losses.
But note that the fund aims for a 4% return, but doesn't guarantee a 4% return. So when you say you "would" receive a payout of $915 per month, what that means is "assuming the stock market cooperates."
If you go to the fund page and click on "Price and Performance," and then go over to the "Select a Benchmark" tab and select S&P 500 Index, you get a chart that compares this fund to the S&P 500. What the chart shows is that the fund went as low as the S&P during the crash in '08, but lagged significantly behind the highs when highs were reached, for instance lately. I have to say that doesn't look very promising to me.
I think it depends on your risk tolerance. To average $1000 a month, what you need is fairly robust returns, and also to save for leaner times when you get above-average returns. If you have the discipline to do that yourself, I think an index fund is a better bet, with the bonus that you save one month's $1000 on fees alone every year.
