What is the best way to invest $1 million to earn at least 5% or more per year?

Question

I want to live off the income, so therefore I want it invested safely.

Answer 1

allow me to suggest that 5% per year isn't enough ... you need to do better than the rate of inflation by the amount that you wish to take out, as well as cover taxes on the whole thing.

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My thought is that this means you're real goal needs to be 12% per year -- 4% for taxes, 3% for inflation and 5% to live on.

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at 12%, you are in the long term average range of stocks and mutual funds, plus other (riskier) deals.

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Also at 1 million in capital, you may have enough that a professional manager [trust company] would take you into their client base and put you into a collective sets of deals [limited partnership].

unless you are very knowledgable of investing, AVOID all the partnership 'opportunities' and unit offering you'll start to get from independent outfits. They're all paying 15% or better commissions to salespeople to gloss over the risks and get your money in.

GL

Answer 2

This Site Might Help You.

RE:
What is the best way to invest $1 million to earn at least 5% or more per year?
I want to live off the income, so therefore I want it invested safely.

Answer 3

Well, since you want safety, I would suggest a high yield money market fund or account. A high yield savings account earning around 5% on a million would give you around $50,000 income annually, which is a really cool salary. You may not find a government or municipal bond yielding that much, so you may just want to stick with cash investments.

Answer 4

That's easy. Invest in stocks and mutual funds. There are so many different programs that you can do with all that to get more then a 5% return and never have to work again obviously if you have 1 million to invest.
Personally I work with E-trade. Quite the little website gives you many options and helps you with them all. Or if your about to pony out the big bucks I would personally get a stock broker to help you with those decisions.

Answer 5

Bonds. remember you have to pay tax on the income, so muni at 3 to4% pre taxe are good. However any bond will also have a credir risk and may lose their prinicpal value, you really have to look at the yield of the bond more than the coupon. Make sure you create a good ladder of bonds or buy inot a bond fund, but avoid MBS bonds as they lack liquidity in these last past few months.
BTW US treasuries are at a all time high and only yield 4%

Answer 6

Try to invest it in short term CD. i.e 5 month Share Certificate, most of them give 5%. With $1 million invested in 5 months for a 5% will give you approximately $20k at the end of 5 month period that is at least $4k a month therefore in a 10month period you can get $40K more than your target. but if you want more than that, then try to establish your own business.

Answer 7

FIRST CHOICE IS AN INVEST FIRM--TELL THEM WHAT YOU WANT....they will help you right away...myself I've gone and down a money market fund at a local credit union, and there are no charges for the money market....at the investment company--a small service fee...nothing to worry about Hey if ya got an extra million or two and don't know what to do with it, I sure could use it to help my church and the Children' Clinic in my [e-mail][e-mail]

Answer 8

If you are investing that much money, you should be speaking to a financial planner!
Do you have retirement savings? Some of it could go into an IRA to live off of when you retire, but if you are young then you will also need some money that you can access now...so maybe your bank could set you up with a money market account or CD.

Answer 9

why only 5%? You can get a lot more with 1$million investment. Diversify it over bonds or stocks if you want more.

Answer 10

I would start investing in needy children and truly needy people. People who cannot return the favor. The bible said when you give it comes back to you. Good measure presssed down running over. It's the law of nature.