If I were Filthy Rich
By Esqulax+28 How to actually set up these investments people talk about and get paid out?
Most posts in this subreddit have a few people who focus only on investing (even if the spirit is more about 'What cool stuff will you do'), However It got me thinking..
When I win £1m (In the UK it's not taxed, but for US folk, assume its $1m landing in your account), and want to act on some of the things that are said here, the main one being 'Invest conservatively, withdraw 4% per year and any gains above that go back in to be compunded'
My question is, How would I do that? I guess contact a broker, but are their fees taken into account? Do I explain that concept to them, or is it a 'normal' request of them?
Also, how would I get the money out? Is it a case of Year 1 - I eat ramen noodles for every meal, then at the start of year 2 I get the £40k? Or can it be a monthly payout?
Seems like the armchair investors on here throw out these ideal scenarios but the normal every person doesn't REALLY know how to physically get something like that set up
Recent responses
+14 @SomethingClever2117 You just setup a brokerage account, invest your money in an Index Fund (all the brokerage firms have their own), and after a year withdraw 4%. You have to do some simple calculations and obviously pay your taxes. But it’s not rocket science so there’s no need to hire an accountant or financial advisor. Just $1m and it’s really easy to do, and can be handled by almost any idiot. Now if you have a lotto win $50m or more you should definitely diversify, and that would take a financial advisor team.
+12 @babycam It's just buying lots of stocks and selling a small amount each year with the hope that your overall value goes up more then what you with draw. You can do easily for free if you're responsible. Or if you're less responsible you can buy stocks that pay a dividend which is a distribution of profit to share holders. Then you just get a check in your account once a quarter.