How to find $1 million!
Smart Income Planning Frees up Cash
I told my wife that I made $600,000 in a call I just had with my bank. As usual, she was incredulous.
No, I’m not a day trader, investing in commodities or oil futures.
I had called my banker to ask whether we could lower the interest rate on our home mortgage — without a lot of hassle. He said sure and our new monthly mortgage payment is now $1,000 lower. The only other riskless way to generate $12,000 a year in guaranteed cash flow is to invest money in U.S. Treasuries. But at today’s rates of about 2%, we would have to put aside $600,000 to generate that cash flow.
Annuity payments can also generate much more income than is possible by investing in bonds. So, when you include them in your Plan for Retirement Income, you may need only $1.5 million, while your twin who doesn’t include annuity payments needs $2.5 million to generate the same income.
You can use your extra $1 million to create even more income with different products, invest in more aggressive securities for your kid’s legacy, or buy that vacation home.
How much money can you find in your savings?