"According to this Redditor, their father has approximately $250,000 in retirement savings at 65 years of age. On the plus side, the dad is mostly debt-free and has both his and his widow's Social Security/401(k) to collect, as well as being an overall frugal individual. On the downside, the $250,000 is about all that is available to live on during retirement, minus a potential inheritance from a family member that may or may not materialize someday."
"While the dad is financially savvy for day-to-day living, they are wondering whether or not dumping all of this money into dividend-earning accounts is a great way to "live" during retirement. Given the recent surge in popularity of dividend investing, particularly with YieldMaxETFs, it's no surprise that this individual is considering this path to earn some money without touching the principal every month."
A 65-year-old retiree holds about $250,000 in savings, is largely debt-free, and expects Social Security and a widow's 401(k) as additional income. The retiree is frugal and faces uncertainty about a possible inheritance. Investing the principal in dividend-paying accounts or ETFs like YieldMaxETFs could produce income without monthly principal withdrawals. Relying solely on dividends risks reducing the account balance over time, which would diminish future dividend income and long-term security. Qualified dividends receive favorable tax treatment up to $47,500 of annual income for single filers. A conservative, diversified income strategy and attention to taxation are important.
Read at 24/7 Wall St.
Unable to calculate read time
Collection
[
|
...
]