Stock Investing Strategies

Stock investments

rainbow

What to Do With Your Retirement Money

There’s a ton of 401k plan information online that will tell you what you can do with your 401k and how much you can save. But there is not a lot of information on what the best plan of action is once you retire.

Even if you retire with a large retirement savings set aside, say $400,000, it does not give you that much time. If you are spending $40,000 a year during retirement, then the money will simply dry up after 10 years. And with people living longer than ever that isn’t going to be enough to support you through your entire golden years. It isn’t like social security is going to last forever.

Instead there are many different ways which you can invest that money and live off of it however long you want. One option is to invest into a group of strong stocks paying high dividends. If you invest your money into these type of investments you will receive some extra passive income month after month and if your have a few hundred thousand dollars you may be able to live off of the dividend alone.

For example if you find a bunch of dividend investments paying out an annual dividend of 10% that would mean if you invested $400,000 into the stock you would recieve approximately $40,000 of passive income every year. Once more this money will never run out because you are only spending the profits not the money itself. This way you live off the cash flow, so you never have to worry about running out of money before you die. Also you will have some money to leave behind to your family once your gone.

Another way of investing your retirement income is to invest it into a few rental properties.Real Estate investing can be a terrific way to build your passive income. If you were able to take that $400,000 and invest it into 4 different rental properties, then rent them out for $700 a month, this would mean you would recieve an income of $2,800 each and every month. As time goes by you can increase the rent and therefore your income.

I’ve heard it said that $1 million dollars isn’t enough to retire. Well that may be true if you don’t plan on doing anything with the money, however there are plenty of ways to make your budget work out and to create passive cash flow with a good chunk of money. It is also a much better alternative then trying to calculate your death which is what most financial professionals will do after you retire.

Tags: ,

Comments are closed.