Mon Mar 31 2025, by Tyler Gardner

How to Invest $2 Million for Retirement Without Running Out of Money

If you're looking to invest $2 million for retirement without ever running out of money, here’s how I would approach it. If any of this is helpful, tune into my new podcast, Your Money Guide on the Side, where we'll delve into this in more depth, you know—like more than 62 seconds.

1. Build a Three-Bucket System

Start by building a three-bucket system:

• Cash and T-bills for short-term liquidity,
• Dividend stocks and REITs for cash flow,
• Growth stocks for, well, growth.

2. Avoid the Bond Trap

Avoid falling into the bond trap. Even though you've been told that bonds are A) safe and B) should be increased in your portfolio as you get older, remember that they likely won’t outpace inflation. If you're earning 3% to 4% a year on those bonds while withdrawing 5% to 6% from your portfolio, they won’t keep up with your needs.

3. Strategic Withdrawals

For withdrawals, use whatever percentage rule works for you but adjust for market conditions. For instance, if the market is up 25% this year, sure, take 8%. But if the market was down 10%, you want to take advantage of cash and dividends this year instead to avoid depleting long-term growth. I trust you don’t need an annual rule to tell you this.

Bottom Line

The bottom line is that $2 million can last forever, but only if you invest it in growth, keep cash available for flexibility, and withdraw wisely.

If you found this information helpful, please like and follow, and I’ll keep sharing insights to guide you on your financial journey.

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