Yes, you could easily live off $1 Mil if you managed it right. Say you placed it into a good mutual fund (generally good ones are 12-14%, really good ones are near 18-20%) at 12% interest. Inflation has averaged about 4.2% for the last 40 years.
If you take in account that inflation and only withdraw 7.8% of the investment (so that you would continue to get a price of living increase every year), that would give you $78,000 to live off for the first year and it would go up 4.2% every year to combat inflation. Of course you would be taxed on it, but I think most people could get by with that.
2007-01-22 04:24:08
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answer #1
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answered by Nate 3
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It would depend on the interest rate you got and how much money you spent. 1% per annum would give you 10,000 dollars a year to live on which probably isn't enough but if you could find an investment that got you 4% pa then you might manage. If you invested it in property and got a return of 10% pa then you'd probably struggle by I would imagine.
2007-01-22 06:53:52
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answer #2
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answered by gerrifriend 6
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Here is the formula for interest : 1,000,000.oo divide by 2 = $500,000.00 then drop a zero = $50,000.oo.
Can you live off $50,000 annually whether in two years or in 30 years ?
I know I can due to having no debt and being as frugal as I am.
2007-01-22 05:45:24
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answer #3
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answered by Kitty 6
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At 10% APY, Yes I could live off the interest.
Michael
2007-01-22 04:27:41
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answer #4
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answered by PrayerRequestBox 3
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maybe, if you earned 1% interest on a standrad savings account that would be approx $10000/month (if you always take it out once per month) I'd stay that is a pretty comfortable amount per month as long as you don't have a huge mortage to pay, you will most likely need to live in an average home.
2007-01-22 03:56:36
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answer #5
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answered by Em C 5
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depends on where you invest it and rate of return and your lifestyle. if you live like a bum and spend very little very likely you can but if you spend too much you won't be able to
2007-01-22 03:56:46
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answer #6
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answered by Anonymous
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If it is wisely invested and you are frugle, yes.
2007-01-22 03:56:55
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answer #7
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answered by Anonymous
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