specific choices for high income on retirement?

Answer 1

The first rule of thumb is to pay yourself first. Let us suppose you are 20 years old and wish to retire at age 65. What amount of money would you have to deposit at a 10 per cent rate for this one deposit to make you a millionaire?

Total = Principal × ( 1 + Rate )years

We would want to solve for principal and so we would input the TOTAL = 1,000,000 the YEARS =45 and the RATE = 10 per cent.

Our answer shows that one deposit of $13,719.21 at 10 per cent interest at age 20, allows you to be a millionaire at age 65.

This shows you the incredible earning power of compound interest. It gives you something to think about doesn't it?

Also, open a Vanguard account and start a 401K. If your company matches a certain percentage of your contributions then save the maximum amount. Pick a good balance between mutual funds and stocks. Don't trade stocks too quickly... ride out the bad times... Most stocks will rebound to be much better than the price that you bought them... This may take many years but the payoff will be worth it!

Answer 2

Here’s a simple, three-fund portfolio consisting of low-cost ETF’s that is likely to outperform anything your stock broker throws at you over the next 10 years.

Vanguard's Total Stock Market ETF – VTI – total market
iShares International MSCI EAFE value fund – EFV – value fund
iShares Lehman Aggregate Bond Fund – AGG – aggregate bond fund

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Answer 3

Not knowing your tax bracket, portfolio size, risk tolerance, state of residence, or age, it's tough to make a recommendation.

As a broker, when someone comes to me seeing current income, those are a few of the things I like to discuss. That said, a few of my favorite options are muni bonds, gov't agency bonds,
american funds: capital income builder and income fund of america.

Answer 4

The main problem with high income is there is a certain high risk associate with that income. In my mind a blend of equity and income oriented funds will provide you a better strategy. Over the long haul historically equity has returned about 10% annually. High grade debt has returned about 6% annually. And currently it is not returning that while inflation is eating 3% annually, maybe 4%. A 70%-30% equity-debt approach offers current income with capital appreciation which can be tapped into to increase income.

Specific choices: one responder has already offered you a choice of index funds that meets the above criteria.

I will offer you some slightly different choices of managed funds.

Debt investments 30%

SGL a closed end fund investing in government bonds of world governments current return 7.8% average 10 year return 8.5% pays monthly dividend. 10% of your assets.

FCO a closed end fund investing in government bonds of world governments current return 6.0% average 10 year return 7.8%. pays monthy dividend. 10% of your assets.

6 mo t-bills 10% of your assets. current return 5.0% pays interest every 6 months. Free from local and state taxes.

Equity investments.

GAM 10% of assets. pays annual distribution of about 3.0%. Average annual return over past 10 years 15.7% general equity fund.

SWZ 10% of assets. pays annual distribution of about 0.2% Average annual return over past 10 years 12.7% Invests in Swiss companies

FF 10% of assets. pays annual distribution of about 1.5% Average annual return over past 10 years 19.9%. Invests in bank stocks.

FUND 10% of assets. pays annual distribuiton of about 5.0% Average annual return over past 10 years 17.7%. Invests in small cap stocks.

GAB 10% of assets. pays annual distribution of about 3.0%. Average annual return over past 10 years 12.3%. Invests in value stocks.

TDF 10% of assets. pays annual distribution of about 1.5%. Average annual return over past 10 years 13.0%. Invests in China and far east.

IIF 10% of assets. pays annual distribution of about 1.0%. Average annual return over past 10 years of 22.7%. Invests in India.