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[–] 3 points 10 months ago (3 children)

I have a friend who made it big young (well earned IMO, they started working at 15) and they have about 2M in investments.

They make 4k/month after taxes just from the stock dividends every year.

That’s well enough for a comfortable life over here, as their house and cars are paid for - and the money keeps growing in investments.

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  • [–] 2 points 10 months ago (2 children)

    I’m not quite at that level, but I’m getting there. My main concern would be health care. And that my house isn’t fully paid off. And with Trump manipulating the market, idk I get nervous. 2 million might work. But I know 1 million is for sure not enough, at least in the US.

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  • [+] 2 points 10 months ago* (last edited 9 months ago) (1 child)
  • [–] 2 points 10 months ago

    We're aiming for $2.5-$3 million in investment income. That's based on two things:

    1. The median household incomes in the US is about $80,000.
    2. The safe indefinite withdraw rate in stock index funds is about 3%.

    (2) is based on the 3% rule, a common retirement planning tool. People have crunched the numbers on historic market returns, factoring in inflation, dividends, etc. 3% is about the amount you can safely withdraw each year while the principal will still remain steady through time, even after adjusting for inflation and crashes. It is the amount you use if you want to be reasonably certain you will not outlive your retirement income.

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