Sat Oct 26 2024, by Tyler Gardner

How to Live Off $1 Million in Retirement Without Running Out of Money

Here is exactly how I would live off of $1 million in retirement without ever running out of money. I'm Tyler, a former financial advisor and portfolio manager, and I create financial content for free so you don’t have to pay for it.

1. Invest in a Blue Chip Dividend Fund

I would invest 100% of my money in a blue chip dividend fund that pays out about 3.5% in dividends each year. That gives me $35,000 of pre-tax income.

2. Annual Stock Sales

On January 2nd of each year, I would sell an additional 4% of my stocks. This would provide another $40,000 of pre-tax income.

3. Social Security Benefits

When I take my Social Security benefits at 62, I’ll receive an additional $25,000 a year pre-tax. This will not only offset the taxes from the first two income sources but will also allow me to live on a net of about $75,000 a year.

4. Growth of Investments

Because I invested 100% of my money in stocks and expect them to grow at the historical average of 8%, even after selling 4% per year, my initial $1 million should be worth closer to $3.49 million in 16 years. This would allow me to either live off the 3% dividend yield alone for the rest of my life or spend over $300,000 a year until I die—because now I can.

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