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  1. #1
    Senior Member Snowsurfer's Avatar
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    Amount of money every year so not have to work by investing?

    How do you get money enough to cover all of your costs every year instead of working?

    If I had a million dollars, could I invest it so that I don't need to work? How would I do this? If I gave you $1million how would you invest it to get enough for each year of your expenses?

    GICs? savings?

  2. #2
    Spelling Snob Hobartlemagne's Avatar
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    Buy 20 or 30 year bonds. $1Mil will give you about $30,000+ per year.

    This is why you need more than $1Mil

    The first rule of flats is You don't talk about flats!

  3. #3
    Tiocfáidh ár Lá jfmckenna's Avatar
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    I could live easy on 30K per year.

  4. #4
    K2ProFlex baby! ilikebikes's Avatar
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    Quote Originally Posted by Snowsurfer View Post
    How do you get money enough to cover all of your costs every year instead of working?

    If I had a million dollars, could I invest it so that I don't need to work? How would I do this? If I gave you $1million how would you invest it to get enough for each year of your expenses?

    GICs? savings?
    If you had 1.5 you could invest with GE and get $7000.00 monthly for about 30+ years thats $84,000 a year which adds up to 3,024,000.00 after 30 years! (if you dont use any of it)
    You see, their morals, their code...it's a bad joke, dropped at the first sign of trouble. They're only as good as the world allows them to be. I'll show you. When the chips are down, these...These "civilized" people...they'll eat each other. See, I'm not a monster. I'm just ahead of the curve

  5. #5
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    If I got a million lump sum after taxes, I would use it to buy a 20 or 30 year annuity, depending on my age at the time.
    Regards, MillCreek
    Snohomish County, Washington USA

  6. #6
    long time visiter Alfster's Avatar
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    Quote Originally Posted by jfmckenna View Post
    I could live easy on 30K per year.
    You realize that's pre-tax dollars?

  7. #7
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    Very simple rule of thumb - figure what you need to live on, multiply by 25. To be more conservative, multiply by 30. That's how much you need to start.

    This should allow you to live 40 to 50 years. If you are younger, you'll need more than that.

    Remember you have to allow for inflation as well - this rule of thumb allows you increase your "income" each year to keep up with inflation. But it also assumes that at the end of the period you're out of money.

    T. Rowe Price has a simple retirement income calculator on their website that allows you to play around with these numbers.

    I just ran the number for a 30-year-old and they say that, starting with $1 million invested in a mix of stocks and bonds, you could generate $2,188 a month in income, with a 90% chance the money would last until you're 95.

  8. #8
    K2ProFlex baby! ilikebikes's Avatar
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    My response would have been something along the lines of: "Does your bike have computer controlled suspension? Then shut your piehole, this baby is from the future!"
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    Quote Originally Posted by Snowsurfer View Post
    How do you get money enough to cover all of your costs every year instead of working?

    If I had a million dollars, could I invest it so that I don't need to work? How would I do this? If I gave you $1million how would you invest it to get enough for each year of your expenses?

    GICs? savings?
    Dude, if you have 1 mil you can make it 1.5 mil very quickly, call someone at "Wilmington Trust" https://www.wilmingtontrust.com/wtcom/ theyll make your 1 mil into 1.5 mil in no time, then theyll set you up with GE as mentioned in my last reply $7000.00 a month for 30+ years is F'N awesome!
    Last edited by ilikebikes; 12-14-08 at 06:00 PM.
    You see, their morals, their code...it's a bad joke, dropped at the first sign of trouble. They're only as good as the world allows them to be. I'll show you. When the chips are down, these...These "civilized" people...they'll eat each other. See, I'm not a monster. I'm just ahead of the curve

  9. #9
    Domestic Domestique UnsafeAlpine's Avatar
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    I've lived on 12,000 a year for about 4 years now. That's pre-taxes. If you can't make it on 30 a year...

  10. #10
    Banned. ModoVincere's Avatar
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    Rob ft. knox.

  11. #11
    BikeForums Founder Joe_Gardner's Avatar
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    Quote Originally Posted by UnsafeAlpine View Post
    I've lived on 12,000 a year for about 4 years now. That's pre-taxes. If you can't make it on 30 a year...
    I was told about a study that measured the correlation between happiness and income, apparently, money will make you happier up to about $10k a year (in todays dollars), after that, it has no effect. The same survey covered the correlation between money and un-happiness at the higher income brackets, but I don't remember what the findings where.
    http://www.joe-gardner.com <-- my photo site.
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  12. #12
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    Quote Originally Posted by Joe_Gardner View Post
    I was told about a study that measured the correlation between happiness and income, apparently, money will make you happier up to about $10k a year (in todays dollars), after that, it has no effect. The same survey covered the correlation between money and un-happiness at the higher income brackets, but I don't remember what the findings where.
    I would need to see that study. $ 10 K per year would be well below poverty level in most areas of the USA. I can't believe that income of less than poverty level equals happiness. I wonder if there is a typo here.
    Regards, MillCreek
    Snohomish County, Washington USA

  13. #13
    BikeForums Founder Joe_Gardner's Avatar
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    I'll ask my friend to forward the URL.
    http://www.joe-gardner.com <-- my photo site.
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  14. #14
    Ogr8nwmypstmksnosnse pgoat's Avatar
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    I think everyone's mileage will vary (for instance if you have a few kids, more money may be need to buy basic happiness), but I will say money ain't everything.

    Every time I took a pay cut to take a job I really wanted I was poorer but happier overall. Every time I took a job I didn't want just for the raise I was richer but more miserable. every time.

    Money is important. It's just not everything. Just my .02

    I won't say anything about strict semantic definitions of happiness, though.
    Quote Originally Posted by jsharr View Post
    People whose sig line does not include a jsharr quote annoy me.

  15. #15
    K2ProFlex baby! ilikebikes's Avatar
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    My response would have been something along the lines of: "Does your bike have computer controlled suspension? Then shut your piehole, this baby is from the future!"
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    Quote Originally Posted by Joe_Gardner View Post
    I was told about a study that measured the correlation between happiness and income, apparently, money will make you happier up to about $10k a year (in todays dollars), after that, it has no effect. The same survey covered the correlation between money and un-happiness at the higher income brackets, but I don't remember what the findings where.
    Hey Joe hows it going!
    I just wanted to say that there was a time that I bought in about $12k a year and we were happier than flies in.......poop! Money does indeed have no effect after $10k per. Think about it, if your happy as can be at $10k per why would you be any happier with more? I make quite a bit more these days and Im not a bit happier than I was when I made $12K.
    Last edited by ilikebikes; 12-14-08 at 08:22 PM.
    You see, their morals, their code...it's a bad joke, dropped at the first sign of trouble. They're only as good as the world allows them to be. I'll show you. When the chips are down, these...These "civilized" people...they'll eat each other. See, I'm not a monster. I'm just ahead of the curve

  16. #16
    Senior Member
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    Quote Originally Posted by jfmckenna View Post
    I could live easy on 30K per year.
    That's my annual bike budget. Then I need money for food and beer.
    You're just trying to start an argument to show how smart you are.

  17. #17
    K2ProFlex baby! ilikebikes's Avatar
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    Quote Originally Posted by StanSeven View Post
    That's my annual bike budget. Then I need money for food and beer.
    If thats true its really sad
    Last edited by ilikebikes; 12-14-08 at 09:25 PM.
    You see, their morals, their code...it's a bad joke, dropped at the first sign of trouble. They're only as good as the world allows them to be. I'll show you. When the chips are down, these...These "civilized" people...they'll eat each other. See, I'm not a monster. I'm just ahead of the curve

  18. #18
    Overacting because I can SpongeDad's Avatar
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    Quote Originally Posted by MillCreek View Post
    I would need to see that study. $ 10 K per year would be well below poverty level in most areas of the USA. I can't believe that income of less than poverty level equals happiness. I wonder if there is a typo here.
    When I made $10K/yr, I qualified for HUD housing and was pretty happy. No way I could have afforded kids though or saved for retirement. Basically, I was living on $10K of pizza and beer.
    “Courage is going from failure to failure without losing enthusiasm." (Churchill)

    "I am a courageous cyclist." (SpongeDad)

  19. #19
    Senior Member Snowsurfer's Avatar
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    Quote Originally Posted by ilikebikes View Post
    If thats true its really sad
    Well, the world ain't exactly a happy place now is it?

  20. #20
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    Quote Originally Posted by MillCreek View Post
    I would need to see that study. $ 10 K per year would be well below poverty level in most areas of the USA. I can't believe that income of less than poverty level equals happiness. I wonder if there is a typo here.
    I believe it meant that increasing your current salary by up to $10k would also increase your happiness; but beyond $10k a greater increase in salary would not induce a greater increase in happiness. I do not believe it meant that you would be happy on only $10k/year.

  21. #21
    Senior Member Snowsurfer's Avatar
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    If I had $20K/year more I would be happier. For sure.

    So if I had $1.5million, I could get $80,000 a year for life?

  22. #22
    Senior Member DannoXYZ's Avatar
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    How old are you? It's definitely possible to get $80k/year out of $1.5mil. However, you must earn MORE than that to make up for the amounts you spend. That's to increaseyour annual yields to compensate for inflation, taxes, bear-markets, etc.

    Any pile of money ALWAYS carries a certain amount of risk. Even as cash, you're facing inflation, theft, bank-default risks. Inflation has been closer to 7% averaged over the past 30-years, more like 15% in the past 5 given the cost of gas and housing. Your pile of money MUST earn at least 7% just to break even without withdrawing anything.

    At $1.5-mil, you don't qualify for professional money-management. These are the guys who manage your money and only take a percentage of the profits. They are worth their weight in gold and can easily earn you that $80k/year. About $10-mil is where it starts to make it worth their time. The biggest gains comes to those with the most money. Partly because they can withstand the drawdowns in bear-markets without worry and partly because they can hire real pro firms to manage their money.

  23. #23
    Squirrelly Member trsidn's Avatar
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    Quote Originally Posted by UnsafeAlpine View Post
    I've lived on 12,000 a year for about 4 years now. That's pre-taxes. If you can't make it on 30 a year...
    That's not enough if you want really good toys....
    Quote Originally Posted by Nicodemus View Post
    Yet more proof that I'm.. well, pretty much right about everything.

  24. #24
    Senior Member deraltekluge's Avatar
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    Consider inflation. Over the past 30 years, the cost of living has increased by a factor of more than 3 (and that's after increasing by a factor of nearly 2 over the previous decade). And housing costs have increased even more than that...

    If you had put your money into a fixed income annuity back then, you'd be in great financial pain now.

    What will happen over the next 30 or 40 years? Nobody knows, of course. Even with a small inflation rate of about 2%, cost of living will double in about 36 years.

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