Michael Blake, 70, who ran in a furniture business in South Shields for four decades before it moved to Wallsend, was approached outside his house by a man in a fluorescent jacket and asked to take delivery of a parcel for a neighbour.
Newcastle Crown Court heard when Mr Blake agreed and opened the door to his home in Penshaw, he was pushed inside by the fake worker, who was then joined by two more, masked raiders, and ordered to hand over cash at knifepoint.
During the terrifying ordeal, the businessman was hit in the face with the handle of the weapon, which had a 14-inch blade, before the raiders left with almost £20,000 in cash as well as high value vintage watches.
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Mr Blake told police: "To be held at knifepoint by three men in my own house is an intensely terrifying thing to happen.
"I still have vivid flashbacks to them coming towards me, one with a knife poised ready to cut me.
"I was told if I didn't co-operate I would be killed. I was told if I spoke to the police they would come back to finish me off."The court heard Mr Blake handed over around £4,000 in cash but the raider kept asking for "the real money" and pushed him upstairs, where he took the watches.
Prosecutor Michael Bunch said: "The man kept demanding the money, acting aggressively, making threats he would use the knife to cut his hand off."
The court heard the raider was joined by two masked accomplices and Mr Blake eventually showed them a place under floorboards where another £15,000 was kept, in a Quality Street tin.
He was warned to stay in the bathroom ‘for five minutes’ after the raiders left he house but fled from the back door as soon as he heard them go.
Ian Skivington, 51, of Thornhill Road, Ponteland, and Lee Donald, 39, of Rowantree Road, Newcastle, both admitted aggravated burglary and were each jailed for seven years and eight months.
Thomas Clayton, 38, of Laburnum House, Wallsend, admitted handling stolen goods and was jailed for four months.