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How much Money Should I save in Order to Generate $1000/Month for the rest of my life?


Saving for retirement: How much is enough?Is there a rule of thumb for how much to save into your pension for retirement?How much should a graduate student attempt to save?What should I consider when I try to invest my money today for a larger immediate income stream that will secure my retirement?Building financial independenceHow can I save money when I don't have any left over at the end of the month?Guide to save money in all-time lifeHow much do I need to save per month in an interest-bearing account to reach a certain account balance in a certain number of years?How to save money on bathroom overheads?






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1















How much money do I need to make in order to generate 1k/month for the rest of my life?



Is that even possible? If yes, in what way?










share|improve this question









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  • Have you considered a lifetime annuity? These are a product to specifically guarantee this life long.

    – Vality
    9 hours ago






  • 4





    Let's assume for the moment that you could live on $1000/month next year. Did you consider that $1000/month in 2050 won't have the same purchasing power as $1000/month in 2020? Any constant dollar amount per month might not be the right kind of goal.

    – Chris W. Rea
    8 hours ago


















1















How much money do I need to make in order to generate 1k/month for the rest of my life?



Is that even possible? If yes, in what way?










share|improve this question









New contributor



samouray is a new contributor to this site. Take care in asking for clarification, commenting, and answering.
Check out our Code of Conduct.





















  • Have you considered a lifetime annuity? These are a product to specifically guarantee this life long.

    – Vality
    9 hours ago






  • 4





    Let's assume for the moment that you could live on $1000/month next year. Did you consider that $1000/month in 2050 won't have the same purchasing power as $1000/month in 2020? Any constant dollar amount per month might not be the right kind of goal.

    – Chris W. Rea
    8 hours ago














1












1








1








How much money do I need to make in order to generate 1k/month for the rest of my life?



Is that even possible? If yes, in what way?










share|improve this question









New contributor



samouray is a new contributor to this site. Take care in asking for clarification, commenting, and answering.
Check out our Code of Conduct.











How much money do I need to make in order to generate 1k/month for the rest of my life?



Is that even possible? If yes, in what way?







savings income financial-independence






share|improve this question









New contributor



samouray is a new contributor to this site. Take care in asking for clarification, commenting, and answering.
Check out our Code of Conduct.










share|improve this question









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samouray is a new contributor to this site. Take care in asking for clarification, commenting, and answering.
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share|improve this question




share|improve this question








edited 6 hours ago









Bob Baerker

26.6k3 gold badges39 silver badges65 bronze badges




26.6k3 gold badges39 silver badges65 bronze badges






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asked 10 hours ago









samouraysamouray

1093 bronze badges




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New contributor




samouray is a new contributor to this site. Take care in asking for clarification, commenting, and answering.
Check out our Code of Conduct.

















  • Have you considered a lifetime annuity? These are a product to specifically guarantee this life long.

    – Vality
    9 hours ago






  • 4





    Let's assume for the moment that you could live on $1000/month next year. Did you consider that $1000/month in 2050 won't have the same purchasing power as $1000/month in 2020? Any constant dollar amount per month might not be the right kind of goal.

    – Chris W. Rea
    8 hours ago


















  • Have you considered a lifetime annuity? These are a product to specifically guarantee this life long.

    – Vality
    9 hours ago






  • 4





    Let's assume for the moment that you could live on $1000/month next year. Did you consider that $1000/month in 2050 won't have the same purchasing power as $1000/month in 2020? Any constant dollar amount per month might not be the right kind of goal.

    – Chris W. Rea
    8 hours ago

















Have you considered a lifetime annuity? These are a product to specifically guarantee this life long.

– Vality
9 hours ago





Have you considered a lifetime annuity? These are a product to specifically guarantee this life long.

– Vality
9 hours ago




4




4





Let's assume for the moment that you could live on $1000/month next year. Did you consider that $1000/month in 2050 won't have the same purchasing power as $1000/month in 2020? Any constant dollar amount per month might not be the right kind of goal.

– Chris W. Rea
8 hours ago






Let's assume for the moment that you could live on $1000/month next year. Did you consider that $1000/month in 2050 won't have the same purchasing power as $1000/month in 2020? Any constant dollar amount per month might not be the right kind of goal.

– Chris W. Rea
8 hours ago











4 Answers
4






active

oldest

votes


















6
















What you are describing is a lifetime annuity. You pay a lump sum now and then get a fixed amount until you die.



Included in this calculation are estimates of (1) how long you will live (2) how much your money will earn when invested. Both of those are difficult to estimate, so in order to be confident you don't run out of money before dying, you must do one of the following:



  1. Massively overestimate how much you need to invest today. Lots of money will be left over, probably, when you die.

  2. Purchase an annuity from a financial intermediary. That's what they are for. That will offload the risk that you will live a long time to the annuity provider. Some people who buy the annuity will die early and others will die late, so you don't have to overestimate. The company bears the risks.

My suggestion is to call up your favorite financial services provider (Fidelity is who I use), tell them your age, and ask how much a lifetime annuity will cost (tell them when it will start paying as well). They will give you a better quote than random people on the internet will.






share|improve this answer

























  • +1 but worth noting there are lots of annuity types. The opening paragraph describes "single premium immediate annuity" which has the feature of being the most commoditized and thus cheapest due to competition.

    – user662852
    2 hours ago


















4
















There’s a general “rule of 4%” for investing. It means that a given sum invested in a total market Index fund can usually generate 4% a year indefinitely. Using that rule, $300,000 would generate $1000/mo.






share|improve this answer

























  • The only Rule of 4% that I've ever seen is for retirees to withdraw 4% of their investment assets every year.

    – RonJohn
    4 hours ago











  • @RonJohn That seems applicable here...

    – Michael
    2 hours ago











  • @Michael not true, since Rocky's answer is all about interest income, whereas the Rule of 4% means to withdraw 4% of $300,000 leaving you with $288,000 which grows to $299,520. Withdraw another 12,000, let the remainder grow 4% and you've got $299,021 at the end of the second year. Rinse, wash and repeat. You can do that for a long time, but not forever. More importantly, you'll be withdrawing that $12,000 even during down swings like the dot com bust and 2007/2008.

    – RonJohn
    2 hours ago


















4
















Simple math that all (and I mean all) depends on the interest rate.



  • At 1%: (1000 x 12)/0.02 = 1200000

  • At 2%: (1000 x 12)/0.02 = 600000

  • At 3%: (1000 x 12)/0.03 = 400000

  • At 4%: (1000 x 12)/0.04 = 300000

Of course, interest rates change, so you'd have to be conservative with your forecasting, and 1000/month isn't very much at all.



EDIT: the elephant in the room is inflation. 20 years from now, 1000 units of currency (said because the actual currency isn't relevant) won't buy as much as it does now.






share|improve this answer



























  • This assumes the OP will live forever. The right calculation should use up all the principal by the end of his/her life.

    – farnsy
    5 hours ago






  • 2





    Knowing exactly how long you are going to live is a little tricky though, most people will admit. I wouldn't like to be 80 and completely out of money because I assumed I'd have died by then.

    – Eric Nolan
    5 hours ago











  • @farnsy so do all the answers, because as Eric Nolan mentioned, we don't know how long we're going to live.

    – RonJohn
    4 hours ago











  • It's much easier to estimate how long you will live than, for example, what the return on your investments will be over the rest of your life. You can build in some padding in case you are the exception. By mentioning this I didn't mean to imply your answer is worse than the others (in fact, it's better, in my view).

    – farnsy
    4 hours ago


















2
















First, there's the issue of how much money you have to earn versus how much money you have for your endeavor after taxes. And then there's the issue of taxation on the yield. You can adjust the numbers per your current and anticipated futures tax brackets.



From a U.S. perspective:



Money market are variable. At the current rate of about 2%, you'd need $600k to generate $1k per month.



You could get about 6% from selective investment grade preferred stocks. Since they are tied to interest rates, that yield would vary modestly as rates change and issues are called. You'd need $200k for that. With some active swapping of issues (reallocation), in most years you could bump that yield to 10% and sometimes even better if there's an interest rate cycle (pre 2008). Preferred stock ETFs have provided about 5.5% return over the past 10 years.



There are a variety of annuities that provide lifetime income. A fixed annuity would be the obvious choice. You'd have to check to see what current rates are.



A variable annuity would be another possibility. The money would be placed in sub-accounts (similar to a mutual fund). I don't know what the current offerings are but historically the guaranteed deferred income component has been 5-6%. You'd get the higher of the two values (market investment versus the deferred guarantee). I had one with a 10% guaranteed deferred side growth. It's a lot more complex than a description here can provide but essentially you're paying higher fees and therefore under performing the market in return for guaranteed income for life.






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    4 Answers
    4






    active

    oldest

    votes








    4 Answers
    4






    active

    oldest

    votes









    active

    oldest

    votes






    active

    oldest

    votes









    6
















    What you are describing is a lifetime annuity. You pay a lump sum now and then get a fixed amount until you die.



    Included in this calculation are estimates of (1) how long you will live (2) how much your money will earn when invested. Both of those are difficult to estimate, so in order to be confident you don't run out of money before dying, you must do one of the following:



    1. Massively overestimate how much you need to invest today. Lots of money will be left over, probably, when you die.

    2. Purchase an annuity from a financial intermediary. That's what they are for. That will offload the risk that you will live a long time to the annuity provider. Some people who buy the annuity will die early and others will die late, so you don't have to overestimate. The company bears the risks.

    My suggestion is to call up your favorite financial services provider (Fidelity is who I use), tell them your age, and ask how much a lifetime annuity will cost (tell them when it will start paying as well). They will give you a better quote than random people on the internet will.






    share|improve this answer

























    • +1 but worth noting there are lots of annuity types. The opening paragraph describes "single premium immediate annuity" which has the feature of being the most commoditized and thus cheapest due to competition.

      – user662852
      2 hours ago















    6
















    What you are describing is a lifetime annuity. You pay a lump sum now and then get a fixed amount until you die.



    Included in this calculation are estimates of (1) how long you will live (2) how much your money will earn when invested. Both of those are difficult to estimate, so in order to be confident you don't run out of money before dying, you must do one of the following:



    1. Massively overestimate how much you need to invest today. Lots of money will be left over, probably, when you die.

    2. Purchase an annuity from a financial intermediary. That's what they are for. That will offload the risk that you will live a long time to the annuity provider. Some people who buy the annuity will die early and others will die late, so you don't have to overestimate. The company bears the risks.

    My suggestion is to call up your favorite financial services provider (Fidelity is who I use), tell them your age, and ask how much a lifetime annuity will cost (tell them when it will start paying as well). They will give you a better quote than random people on the internet will.






    share|improve this answer

























    • +1 but worth noting there are lots of annuity types. The opening paragraph describes "single premium immediate annuity" which has the feature of being the most commoditized and thus cheapest due to competition.

      – user662852
      2 hours ago













    6














    6










    6









    What you are describing is a lifetime annuity. You pay a lump sum now and then get a fixed amount until you die.



    Included in this calculation are estimates of (1) how long you will live (2) how much your money will earn when invested. Both of those are difficult to estimate, so in order to be confident you don't run out of money before dying, you must do one of the following:



    1. Massively overestimate how much you need to invest today. Lots of money will be left over, probably, when you die.

    2. Purchase an annuity from a financial intermediary. That's what they are for. That will offload the risk that you will live a long time to the annuity provider. Some people who buy the annuity will die early and others will die late, so you don't have to overestimate. The company bears the risks.

    My suggestion is to call up your favorite financial services provider (Fidelity is who I use), tell them your age, and ask how much a lifetime annuity will cost (tell them when it will start paying as well). They will give you a better quote than random people on the internet will.






    share|improve this answer













    What you are describing is a lifetime annuity. You pay a lump sum now and then get a fixed amount until you die.



    Included in this calculation are estimates of (1) how long you will live (2) how much your money will earn when invested. Both of those are difficult to estimate, so in order to be confident you don't run out of money before dying, you must do one of the following:



    1. Massively overestimate how much you need to invest today. Lots of money will be left over, probably, when you die.

    2. Purchase an annuity from a financial intermediary. That's what they are for. That will offload the risk that you will live a long time to the annuity provider. Some people who buy the annuity will die early and others will die late, so you don't have to overestimate. The company bears the risks.

    My suggestion is to call up your favorite financial services provider (Fidelity is who I use), tell them your age, and ask how much a lifetime annuity will cost (tell them when it will start paying as well). They will give you a better quote than random people on the internet will.







    share|improve this answer












    share|improve this answer



    share|improve this answer










    answered 3 hours ago









    farnsyfarnsy

    13k24 silver badges45 bronze badges




    13k24 silver badges45 bronze badges















    • +1 but worth noting there are lots of annuity types. The opening paragraph describes "single premium immediate annuity" which has the feature of being the most commoditized and thus cheapest due to competition.

      – user662852
      2 hours ago

















    • +1 but worth noting there are lots of annuity types. The opening paragraph describes "single premium immediate annuity" which has the feature of being the most commoditized and thus cheapest due to competition.

      – user662852
      2 hours ago
















    +1 but worth noting there are lots of annuity types. The opening paragraph describes "single premium immediate annuity" which has the feature of being the most commoditized and thus cheapest due to competition.

    – user662852
    2 hours ago





    +1 but worth noting there are lots of annuity types. The opening paragraph describes "single premium immediate annuity" which has the feature of being the most commoditized and thus cheapest due to competition.

    – user662852
    2 hours ago













    4
















    There’s a general “rule of 4%” for investing. It means that a given sum invested in a total market Index fund can usually generate 4% a year indefinitely. Using that rule, $300,000 would generate $1000/mo.






    share|improve this answer

























    • The only Rule of 4% that I've ever seen is for retirees to withdraw 4% of their investment assets every year.

      – RonJohn
      4 hours ago











    • @RonJohn That seems applicable here...

      – Michael
      2 hours ago











    • @Michael not true, since Rocky's answer is all about interest income, whereas the Rule of 4% means to withdraw 4% of $300,000 leaving you with $288,000 which grows to $299,520. Withdraw another 12,000, let the remainder grow 4% and you've got $299,021 at the end of the second year. Rinse, wash and repeat. You can do that for a long time, but not forever. More importantly, you'll be withdrawing that $12,000 even during down swings like the dot com bust and 2007/2008.

      – RonJohn
      2 hours ago















    4
















    There’s a general “rule of 4%” for investing. It means that a given sum invested in a total market Index fund can usually generate 4% a year indefinitely. Using that rule, $300,000 would generate $1000/mo.






    share|improve this answer

























    • The only Rule of 4% that I've ever seen is for retirees to withdraw 4% of their investment assets every year.

      – RonJohn
      4 hours ago











    • @RonJohn That seems applicable here...

      – Michael
      2 hours ago











    • @Michael not true, since Rocky's answer is all about interest income, whereas the Rule of 4% means to withdraw 4% of $300,000 leaving you with $288,000 which grows to $299,520. Withdraw another 12,000, let the remainder grow 4% and you've got $299,021 at the end of the second year. Rinse, wash and repeat. You can do that for a long time, but not forever. More importantly, you'll be withdrawing that $12,000 even during down swings like the dot com bust and 2007/2008.

      – RonJohn
      2 hours ago













    4














    4










    4









    There’s a general “rule of 4%” for investing. It means that a given sum invested in a total market Index fund can usually generate 4% a year indefinitely. Using that rule, $300,000 would generate $1000/mo.






    share|improve this answer













    There’s a general “rule of 4%” for investing. It means that a given sum invested in a total market Index fund can usually generate 4% a year indefinitely. Using that rule, $300,000 would generate $1000/mo.







    share|improve this answer












    share|improve this answer



    share|improve this answer










    answered 9 hours ago









    RockyRocky

    21.5k4 gold badges56 silver badges86 bronze badges




    21.5k4 gold badges56 silver badges86 bronze badges















    • The only Rule of 4% that I've ever seen is for retirees to withdraw 4% of their investment assets every year.

      – RonJohn
      4 hours ago











    • @RonJohn That seems applicable here...

      – Michael
      2 hours ago











    • @Michael not true, since Rocky's answer is all about interest income, whereas the Rule of 4% means to withdraw 4% of $300,000 leaving you with $288,000 which grows to $299,520. Withdraw another 12,000, let the remainder grow 4% and you've got $299,021 at the end of the second year. Rinse, wash and repeat. You can do that for a long time, but not forever. More importantly, you'll be withdrawing that $12,000 even during down swings like the dot com bust and 2007/2008.

      – RonJohn
      2 hours ago

















    • The only Rule of 4% that I've ever seen is for retirees to withdraw 4% of their investment assets every year.

      – RonJohn
      4 hours ago











    • @RonJohn That seems applicable here...

      – Michael
      2 hours ago











    • @Michael not true, since Rocky's answer is all about interest income, whereas the Rule of 4% means to withdraw 4% of $300,000 leaving you with $288,000 which grows to $299,520. Withdraw another 12,000, let the remainder grow 4% and you've got $299,021 at the end of the second year. Rinse, wash and repeat. You can do that for a long time, but not forever. More importantly, you'll be withdrawing that $12,000 even during down swings like the dot com bust and 2007/2008.

      – RonJohn
      2 hours ago
















    The only Rule of 4% that I've ever seen is for retirees to withdraw 4% of their investment assets every year.

    – RonJohn
    4 hours ago





    The only Rule of 4% that I've ever seen is for retirees to withdraw 4% of their investment assets every year.

    – RonJohn
    4 hours ago













    @RonJohn That seems applicable here...

    – Michael
    2 hours ago





    @RonJohn That seems applicable here...

    – Michael
    2 hours ago













    @Michael not true, since Rocky's answer is all about interest income, whereas the Rule of 4% means to withdraw 4% of $300,000 leaving you with $288,000 which grows to $299,520. Withdraw another 12,000, let the remainder grow 4% and you've got $299,021 at the end of the second year. Rinse, wash and repeat. You can do that for a long time, but not forever. More importantly, you'll be withdrawing that $12,000 even during down swings like the dot com bust and 2007/2008.

    – RonJohn
    2 hours ago





    @Michael not true, since Rocky's answer is all about interest income, whereas the Rule of 4% means to withdraw 4% of $300,000 leaving you with $288,000 which grows to $299,520. Withdraw another 12,000, let the remainder grow 4% and you've got $299,021 at the end of the second year. Rinse, wash and repeat. You can do that for a long time, but not forever. More importantly, you'll be withdrawing that $12,000 even during down swings like the dot com bust and 2007/2008.

    – RonJohn
    2 hours ago











    4
















    Simple math that all (and I mean all) depends on the interest rate.



    • At 1%: (1000 x 12)/0.02 = 1200000

    • At 2%: (1000 x 12)/0.02 = 600000

    • At 3%: (1000 x 12)/0.03 = 400000

    • At 4%: (1000 x 12)/0.04 = 300000

    Of course, interest rates change, so you'd have to be conservative with your forecasting, and 1000/month isn't very much at all.



    EDIT: the elephant in the room is inflation. 20 years from now, 1000 units of currency (said because the actual currency isn't relevant) won't buy as much as it does now.






    share|improve this answer



























    • This assumes the OP will live forever. The right calculation should use up all the principal by the end of his/her life.

      – farnsy
      5 hours ago






    • 2





      Knowing exactly how long you are going to live is a little tricky though, most people will admit. I wouldn't like to be 80 and completely out of money because I assumed I'd have died by then.

      – Eric Nolan
      5 hours ago











    • @farnsy so do all the answers, because as Eric Nolan mentioned, we don't know how long we're going to live.

      – RonJohn
      4 hours ago











    • It's much easier to estimate how long you will live than, for example, what the return on your investments will be over the rest of your life. You can build in some padding in case you are the exception. By mentioning this I didn't mean to imply your answer is worse than the others (in fact, it's better, in my view).

      – farnsy
      4 hours ago















    4
















    Simple math that all (and I mean all) depends on the interest rate.



    • At 1%: (1000 x 12)/0.02 = 1200000

    • At 2%: (1000 x 12)/0.02 = 600000

    • At 3%: (1000 x 12)/0.03 = 400000

    • At 4%: (1000 x 12)/0.04 = 300000

    Of course, interest rates change, so you'd have to be conservative with your forecasting, and 1000/month isn't very much at all.



    EDIT: the elephant in the room is inflation. 20 years from now, 1000 units of currency (said because the actual currency isn't relevant) won't buy as much as it does now.






    share|improve this answer



























    • This assumes the OP will live forever. The right calculation should use up all the principal by the end of his/her life.

      – farnsy
      5 hours ago






    • 2





      Knowing exactly how long you are going to live is a little tricky though, most people will admit. I wouldn't like to be 80 and completely out of money because I assumed I'd have died by then.

      – Eric Nolan
      5 hours ago











    • @farnsy so do all the answers, because as Eric Nolan mentioned, we don't know how long we're going to live.

      – RonJohn
      4 hours ago











    • It's much easier to estimate how long you will live than, for example, what the return on your investments will be over the rest of your life. You can build in some padding in case you are the exception. By mentioning this I didn't mean to imply your answer is worse than the others (in fact, it's better, in my view).

      – farnsy
      4 hours ago













    4














    4










    4









    Simple math that all (and I mean all) depends on the interest rate.



    • At 1%: (1000 x 12)/0.02 = 1200000

    • At 2%: (1000 x 12)/0.02 = 600000

    • At 3%: (1000 x 12)/0.03 = 400000

    • At 4%: (1000 x 12)/0.04 = 300000

    Of course, interest rates change, so you'd have to be conservative with your forecasting, and 1000/month isn't very much at all.



    EDIT: the elephant in the room is inflation. 20 years from now, 1000 units of currency (said because the actual currency isn't relevant) won't buy as much as it does now.






    share|improve this answer















    Simple math that all (and I mean all) depends on the interest rate.



    • At 1%: (1000 x 12)/0.02 = 1200000

    • At 2%: (1000 x 12)/0.02 = 600000

    • At 3%: (1000 x 12)/0.03 = 400000

    • At 4%: (1000 x 12)/0.04 = 300000

    Of course, interest rates change, so you'd have to be conservative with your forecasting, and 1000/month isn't very much at all.



    EDIT: the elephant in the room is inflation. 20 years from now, 1000 units of currency (said because the actual currency isn't relevant) won't buy as much as it does now.







    share|improve this answer














    share|improve this answer



    share|improve this answer








    edited 3 hours ago

























    answered 9 hours ago









    RonJohnRonJohn

    22.7k6 gold badges42 silver badges88 bronze badges




    22.7k6 gold badges42 silver badges88 bronze badges















    • This assumes the OP will live forever. The right calculation should use up all the principal by the end of his/her life.

      – farnsy
      5 hours ago






    • 2





      Knowing exactly how long you are going to live is a little tricky though, most people will admit. I wouldn't like to be 80 and completely out of money because I assumed I'd have died by then.

      – Eric Nolan
      5 hours ago











    • @farnsy so do all the answers, because as Eric Nolan mentioned, we don't know how long we're going to live.

      – RonJohn
      4 hours ago











    • It's much easier to estimate how long you will live than, for example, what the return on your investments will be over the rest of your life. You can build in some padding in case you are the exception. By mentioning this I didn't mean to imply your answer is worse than the others (in fact, it's better, in my view).

      – farnsy
      4 hours ago

















    • This assumes the OP will live forever. The right calculation should use up all the principal by the end of his/her life.

      – farnsy
      5 hours ago






    • 2





      Knowing exactly how long you are going to live is a little tricky though, most people will admit. I wouldn't like to be 80 and completely out of money because I assumed I'd have died by then.

      – Eric Nolan
      5 hours ago











    • @farnsy so do all the answers, because as Eric Nolan mentioned, we don't know how long we're going to live.

      – RonJohn
      4 hours ago











    • It's much easier to estimate how long you will live than, for example, what the return on your investments will be over the rest of your life. You can build in some padding in case you are the exception. By mentioning this I didn't mean to imply your answer is worse than the others (in fact, it's better, in my view).

      – farnsy
      4 hours ago
















    This assumes the OP will live forever. The right calculation should use up all the principal by the end of his/her life.

    – farnsy
    5 hours ago





    This assumes the OP will live forever. The right calculation should use up all the principal by the end of his/her life.

    – farnsy
    5 hours ago




    2




    2





    Knowing exactly how long you are going to live is a little tricky though, most people will admit. I wouldn't like to be 80 and completely out of money because I assumed I'd have died by then.

    – Eric Nolan
    5 hours ago





    Knowing exactly how long you are going to live is a little tricky though, most people will admit. I wouldn't like to be 80 and completely out of money because I assumed I'd have died by then.

    – Eric Nolan
    5 hours ago













    @farnsy so do all the answers, because as Eric Nolan mentioned, we don't know how long we're going to live.

    – RonJohn
    4 hours ago





    @farnsy so do all the answers, because as Eric Nolan mentioned, we don't know how long we're going to live.

    – RonJohn
    4 hours ago













    It's much easier to estimate how long you will live than, for example, what the return on your investments will be over the rest of your life. You can build in some padding in case you are the exception. By mentioning this I didn't mean to imply your answer is worse than the others (in fact, it's better, in my view).

    – farnsy
    4 hours ago





    It's much easier to estimate how long you will live than, for example, what the return on your investments will be over the rest of your life. You can build in some padding in case you are the exception. By mentioning this I didn't mean to imply your answer is worse than the others (in fact, it's better, in my view).

    – farnsy
    4 hours ago











    2
















    First, there's the issue of how much money you have to earn versus how much money you have for your endeavor after taxes. And then there's the issue of taxation on the yield. You can adjust the numbers per your current and anticipated futures tax brackets.



    From a U.S. perspective:



    Money market are variable. At the current rate of about 2%, you'd need $600k to generate $1k per month.



    You could get about 6% from selective investment grade preferred stocks. Since they are tied to interest rates, that yield would vary modestly as rates change and issues are called. You'd need $200k for that. With some active swapping of issues (reallocation), in most years you could bump that yield to 10% and sometimes even better if there's an interest rate cycle (pre 2008). Preferred stock ETFs have provided about 5.5% return over the past 10 years.



    There are a variety of annuities that provide lifetime income. A fixed annuity would be the obvious choice. You'd have to check to see what current rates are.



    A variable annuity would be another possibility. The money would be placed in sub-accounts (similar to a mutual fund). I don't know what the current offerings are but historically the guaranteed deferred income component has been 5-6%. You'd get the higher of the two values (market investment versus the deferred guarantee). I had one with a 10% guaranteed deferred side growth. It's a lot more complex than a description here can provide but essentially you're paying higher fees and therefore under performing the market in return for guaranteed income for life.






    share|improve this answer































      2
















      First, there's the issue of how much money you have to earn versus how much money you have for your endeavor after taxes. And then there's the issue of taxation on the yield. You can adjust the numbers per your current and anticipated futures tax brackets.



      From a U.S. perspective:



      Money market are variable. At the current rate of about 2%, you'd need $600k to generate $1k per month.



      You could get about 6% from selective investment grade preferred stocks. Since they are tied to interest rates, that yield would vary modestly as rates change and issues are called. You'd need $200k for that. With some active swapping of issues (reallocation), in most years you could bump that yield to 10% and sometimes even better if there's an interest rate cycle (pre 2008). Preferred stock ETFs have provided about 5.5% return over the past 10 years.



      There are a variety of annuities that provide lifetime income. A fixed annuity would be the obvious choice. You'd have to check to see what current rates are.



      A variable annuity would be another possibility. The money would be placed in sub-accounts (similar to a mutual fund). I don't know what the current offerings are but historically the guaranteed deferred income component has been 5-6%. You'd get the higher of the two values (market investment versus the deferred guarantee). I had one with a 10% guaranteed deferred side growth. It's a lot more complex than a description here can provide but essentially you're paying higher fees and therefore under performing the market in return for guaranteed income for life.






      share|improve this answer





























        2














        2










        2









        First, there's the issue of how much money you have to earn versus how much money you have for your endeavor after taxes. And then there's the issue of taxation on the yield. You can adjust the numbers per your current and anticipated futures tax brackets.



        From a U.S. perspective:



        Money market are variable. At the current rate of about 2%, you'd need $600k to generate $1k per month.



        You could get about 6% from selective investment grade preferred stocks. Since they are tied to interest rates, that yield would vary modestly as rates change and issues are called. You'd need $200k for that. With some active swapping of issues (reallocation), in most years you could bump that yield to 10% and sometimes even better if there's an interest rate cycle (pre 2008). Preferred stock ETFs have provided about 5.5% return over the past 10 years.



        There are a variety of annuities that provide lifetime income. A fixed annuity would be the obvious choice. You'd have to check to see what current rates are.



        A variable annuity would be another possibility. The money would be placed in sub-accounts (similar to a mutual fund). I don't know what the current offerings are but historically the guaranteed deferred income component has been 5-6%. You'd get the higher of the two values (market investment versus the deferred guarantee). I had one with a 10% guaranteed deferred side growth. It's a lot more complex than a description here can provide but essentially you're paying higher fees and therefore under performing the market in return for guaranteed income for life.






        share|improve this answer















        First, there's the issue of how much money you have to earn versus how much money you have for your endeavor after taxes. And then there's the issue of taxation on the yield. You can adjust the numbers per your current and anticipated futures tax brackets.



        From a U.S. perspective:



        Money market are variable. At the current rate of about 2%, you'd need $600k to generate $1k per month.



        You could get about 6% from selective investment grade preferred stocks. Since they are tied to interest rates, that yield would vary modestly as rates change and issues are called. You'd need $200k for that. With some active swapping of issues (reallocation), in most years you could bump that yield to 10% and sometimes even better if there's an interest rate cycle (pre 2008). Preferred stock ETFs have provided about 5.5% return over the past 10 years.



        There are a variety of annuities that provide lifetime income. A fixed annuity would be the obvious choice. You'd have to check to see what current rates are.



        A variable annuity would be another possibility. The money would be placed in sub-accounts (similar to a mutual fund). I don't know what the current offerings are but historically the guaranteed deferred income component has been 5-6%. You'd get the higher of the two values (market investment versus the deferred guarantee). I had one with a 10% guaranteed deferred side growth. It's a lot more complex than a description here can provide but essentially you're paying higher fees and therefore under performing the market in return for guaranteed income for life.







        share|improve this answer














        share|improve this answer



        share|improve this answer








        edited 1 hour ago

























        answered 6 hours ago









        Bob BaerkerBob Baerker

        26.6k3 gold badges39 silver badges65 bronze badges




        26.6k3 gold badges39 silver badges65 bronze badges
























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