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It's a nice sum of money. But it's certainly not enough to live doing nothing for the rest of your life. Again YMMV but if you want to have a family, kids, and

by anonu 5y ago

It's a nice sum of money. But it's certainly not enough to live doing nothing for the rest of your life. Again YMMV but if you want to have a family, kids, and I suspect you live in a Western country where the cost of living is not that low, you're going to run out unless you put your money to work for you. So this either means investing in yourself ... Start a company or business. Or investing in others: making safe bets in the market (not crypto).

nullc 5y ago
> It's a nice sum of money. But it's certainly not enough to live doing nothing for the rest of your life. ??? 7.5m EUR is 8.4m USD. The average number of working years for men is 38 per google (which is also 65-27 the number of years until the poster is 65). 8.4m over 38 years is 221k/yr. The median household income in San Francisco (to pick an expensive city as an example) is 113k/yr. So even assuming the the funds were not invested in anything outperforming inflation this should be more than enough to "live doing nothing", and potentially even without investment at all (depending on your beliefs in future inflation). Of course, it won't be enough if OP burns most of it starting some crazy business. To maintain SF-median-present-value income until age 80 their investments would need to yield greater than inflation minus 1.24%. Under the commonly used 4% rule of thumb, OP could invest in market indexes and spend $337k/yr in present value for the rest of their life.
- rfd4sgmk8u 5y ago
  g, do you think the 4% thing is even a realistic recommendation today? I also having doubts that index fund investing is even beating inflation in the long run. SPY VOO etc are just 2 of the giant monetary sinks being fed by passive investment through retirement funds, pensions, etc. being cap weighted smooths out the supply from the continuous influx of new money. its growth is an indicator of monetary supply. I hope folks that have been playing that game are going to be ok when things go a bit strange. Ive never been more bullish on the orange canary in the coal mine.
  - nullc 5y ago
    4% who knows-- at least historically it was a pretty conservative figure--, but if your concern about inflation is the ballooning money supply you should expect broad market investment to at least keep pace with inflation, since you're moving your wealth out of the supply-inflating asset. A really conservative approach for someone like the OP would be to come up with a low watermark level of spending that is enough to live comfortably, invest enough in extremely low risk investments that just keep up with inflation to support that level. Keep their long term obligations within that level of spending... then invest the rest of their money in the market and spend the additional yield discretionarily. Here is a really conservative approach for the OP's figures: Assume OP could live comfortably on 70k/yr in present dollars and that they'll live to 104. They set aside 77*70k=5.39m dollars in extremely low risk investments which merely expected to at-least meet inflation after taxes. They invest the remaining 3.04 million in riskier investments they expect to return more (market indexes, maybe a few companies, a bit of Bitcoin)-- and spend 4%/yr of that pool on discretionary spending, so an extra 120k/yr bringing their total spending budget to 190k. Re-balance every once in a while to keep the nearly-riskless pool at the right size to guarantee their base spending level -- adding to it if it under-performed cost inflation or taking from it when it over-performs. Purchase of a home could be taken out of the base spending pool, so long as care is taken to make sure the the funds needed for its maintenance and property taxes are included in it. If the riskier investments perform well the discretionary spending budget will go up, if they perform poorly they'll at least preserve their base spending level. They could do somewhat better by immediately cutting spending during down markets -- those 4% figures don't assume that you're doing that but someone whos base spending is secured by another pool of assets should have a lot of ability to do so.
coldtea 5y ago
>It's a nice sum of money. But it's certainly not enough to live doing nothing for the rest of your life. In what planet is this the case? Aspen? Gstaad? In most countries of earth, less than half of that is enough to live comfortably to the ripe old age of 90 from 27 - not investing for anything above inflation, and just taking a monthly cut otherwise. You can trivially buy a house for 100-300K (no rent anymore) and then for e.g. 3 million you get 50K/year. That's more than most people make in tons of European countries with comfortable middle class existance, and it is after taxes, and without all the burdens associated with working (like mandating living close to this or that expensive area to be near work, communiting costs, and so on), and it's also guaranteed (unlike e.g. work, where people can be fired, freelancing which has hot/cold periods, etc.).
- anonu 5y ago
  Like I said, your mileage may vary. There are many factors that go into these calculations.

by anonu 5y ago

nullc 5y ago

> It's a nice sum of money. But it's certainly not enough to live doing nothing for the rest of your life. ??? 7.5m EUR is 8.4m USD. The average number of working years for men is 38 per google (which is also 65-27 the number of years until the poster is 65). 8.4m over 38 years is 221k/yr. The median household income in San Francisco (to pick an expensive city as an example) is 113k/yr. So even assuming the the funds were not invested in anything outperforming inflation this should be more than enough to "live doing nothing", and potentially even without investment at all (depending on your beliefs in future inflation). Of course, it won't be enough if OP burns most of it starting some crazy business. To maintain SF-median-present-value income until age 80 their investments would need to yield greater than inflation minus 1.24%. Under the commonly used 4% rule of thumb, OP could invest in market indexes and spend $337k/yr in present value for the rest of their life.

rfd4sgmk8u 5y ago
g, do you think the 4% thing is even a realistic recommendation today? I also having doubts that index fund investing is even beating inflation in the long run. SPY VOO etc are just 2 of the giant monetary sinks being fed by passive investment through retirement funds, pensions, etc. being cap weighted smooths out the supply from the continuous influx of new money. its growth is an indicator of monetary supply. I hope folks that have been playing that game are going to be ok when things go a bit strange. Ive never been more bullish on the orange canary in the coal mine.
- nullc 5y ago
  4% who knows-- at least historically it was a pretty conservative figure--, but if your concern about inflation is the ballooning money supply you should expect broad market investment to at least keep pace with inflation, since you're moving your wealth out of the supply-inflating asset. A really conservative approach for someone like the OP would be to come up with a low watermark level of spending that is enough to live comfortably, invest enough in extremely low risk investments that just keep up with inflation to support that level. Keep their long term obligations within that level of spending... then invest the rest of their money in the market and spend the additional yield discretionarily. Here is a really conservative approach for the OP's figures: Assume OP could live comfortably on 70k/yr in present dollars and that they'll live to 104. They set aside 77*70k=5.39m dollars in extremely low risk investments which merely expected to at-least meet inflation after taxes. They invest the remaining 3.04 million in riskier investments they expect to return more (market indexes, maybe a few companies, a bit of Bitcoin)-- and spend 4%/yr of that pool on discretionary spending, so an extra 120k/yr bringing their total spending budget to 190k. Re-balance every once in a while to keep the nearly-riskless pool at the right size to guarantee their base spending level -- adding to it if it under-performed cost inflation or taking from it when it over-performs. Purchase of a home could be taken out of the base spending pool, so long as care is taken to make sure the the funds needed for its maintenance and property taxes are included in it. If the riskier investments perform well the discretionary spending budget will go up, if they perform poorly they'll at least preserve their base spending level. They could do somewhat better by immediately cutting spending during down markets -- those 4% figures don't assume that you're doing that but someone whos base spending is secured by another pool of assets should have a lot of ability to do so.

coldtea 5y ago

>It's a nice sum of money. But it's certainly not enough to live doing nothing for the rest of your life. In what planet is this the case? Aspen? Gstaad? In most countries of earth, less than half of that is enough to live comfortably to the ripe old age of 90 from 27 - not investing for anything above inflation, and just taking a monthly cut otherwise. You can trivially buy a house for 100-300K (no rent anymore) and then for e.g. 3 million you get 50K/year. That's more than most people make in tons of European countries with comfortable middle class existance, and it is after taxes, and without all the burdens associated with working (like mandating living close to this or that expensive area to be near work, communiting costs, and so on), and it's also guaranteed (unlike e.g. work, where people can be fired, freelancing which has hot/cold periods, etc.).

anonu 5y ago
Like I said, your mileage may vary. There are many factors that go into these calculations.