How to Invest 2 Million Dollars for Income

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You’ve got 2 million bucks, and now you need to convert that to income for your retirement.

Let's take a look at how we would structure that.

Registered Assets

First of all, are the assets registered or not?

Let's look at the scenario of a strong saver, a couple who've been putting aside money all year and the 2 million bucks are in their RRSPs.

Each have 1 million bucks of registered assets. We do not need to factor in the tax consequences of the actual income stream.

⭐ Video on How Does a RESP Work? What are the RESP Withdrawal Rules?

They have 2 million bucks and will want to structure income. They've discovered through financial planning that if they get $100,000 a year pre-tax, that would suffice.

The amount would be anywhere from 75 to 85,000 in after tax dollars, depending on the tax rate of withdrawing of RRSPs.

In any event, the income stream does not matter in structuring a portfolio to generate income.

That means we can use bonds, we can use preferred shares, we can use private debt, we can use stocks, we can use real estate. The tax consequences for this couple is irrelevant.

We've got to make sure that we're structuring a portfolio that's generally generating income. We could take a look at some value stocks. We could take a look at dividend payers, depending on the risk tolerance of the couple, we're going to want to make sure, absolutely sure that we're meeting and matching their volatility needs.

We do not want to use a max growth portfolio if that's not what they can handle, right? The objective for that client is one, to figure out their need, and then to build a portfolio based on that. In this case, tax consequences of any kind are not factored in.

Private debt is one area that we could potentially generate some real nice returns.

If interest rates move and you’re able to get 4 or 5% on bonds, that's a good spot to get income for a conservative client.

There are some dividend paying equities that are paying 4 or 5%. You can take a look at real estate investment trusts, infrastructure, utilities, all of those companies pay very nice consistent income.

At the end of the day, you build this portfolio, you add the different income streams and you subtotal it – you want the income to be 5%.

You can add some alternatives, such as some higher paying rates which can pay 8 or 9%, and then you construct a portfolio that's generating income for the couple.

Non-Registered Assets

Another scenario is where an entrepreneur sells his business and gets $2 million after tax dollars. All of it is in non-registered assets.
In this scenario, tax does become a factor.

The first thing we're going to want to look at is RRSP contribution. Are there any TFSAs and can we do anything with those? Can we shelter any of that income? Can we somehow use a corporation to shelter some of that income?

If all the money is non-registered and you got $2 million and we are building that for tax purposes, you're going to have to make sure to factor in the taxable consequence of all those investments.

Again, we will focus on dividends on the defensive side.

You can take a look at preferred shares or, depending on where interest rates are, there's some really nice yielding preferred shares that could get you that 5% if we want to generate a $100,000 of income for this client. Income, so we can look at preferred shares.

Let’s take a look at dividend paying equities.

Some of the same utility, REITs, private limited partnerships, private REITs – all of these options are tax efficient.

You'll generally want to stay away from the private debt. Depending on your risk tolerance, you're going to want to stay away from anything that's an interest-bearing certificate, for tax purposes.

That scenario is obviously different than the retiree who has all their money in registered assets.

You're building a portfolio for 2 million of income. You need to make sure you calculate what the dividend yield, what the interest income with the return of capital is expected to be in this portfolio. You structure it, you build it, and then you send the cash flow out to the client.

We would send the cash flow out to the client on a monthly basis, and the cash flow is being fed automatically from the portfolio directly to the client's bank account.

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The Tax Bomb In Your Retirement Accounts: How The Roth IRA Can Help You Avoid It

Strategic Money Planning: 8 Easy Ways To Put Your House In Order

State by State Tax Guide For Retirees:




Learn The Basics: Fixed Index Annuities

Learn how fixed index annuities work and provide the following benefits… safety, a reasonable rate of return, accumulation, and income you cannot outlive regardless of age.

Then visit our website for more information about annuities:

Retirement income and maintenance shouldn’t be something that keeps you up at night. But for many, the choices for accumulation of assets have been limited to the potential for large growth in a volatile stock market OR the paltry interest rates earned on CDs, money market funds, or low yield government bonds.

But now, with a fixed index annuity, you have a financial vehicle that offers interest credits linked to various stock market indices that provide the potential for upside growth, with none of the downside risk.

That’s right, when the market goes up, you earn a reasonable rate of return. When the market goes down, you don’t lose a penny. Your principle and all previous gains are locked in, protected, and guaranteed.

But portfolio accumulation is only part of the story. Most Americans fear outliving their retirement income account. You have probably heard the “4% rule.” Basically, it states that you should be able to take 4% out of your portfolio every year and have a 90% chance of not running out of money. That doesn’t give much comfort to retirees in a volatile market. With a fixed index annuity, you are guaranteed that your income payout will never end … regardless of how long you live.

The fixed index annuity’s lifetime income account guarantees that you can withdraw, depending upon your age, 4%, 5%, 5 & 1/2%, 6% or more and never run out of income. And if your account value is growing, there is also the opportunity of having your income payout increase. That is a guarantee!

Let’s take a look at how a fixed index annuity might just be the retirement planning and income tool that would work for you.

A fixed index annuity has 2 separate accounts: the Accumulation account, and the Income account.

Let’s refer to the Accumulation account value as your “walk away money.” This is your initial premium plus all interest credit that you have earned via a linkage to index credits. Many people are just looking for an accumulation vehicle that is tax deferred. A fixed index annuity does that in spades!

Let’s look at the other account … the Income account. The optional rider is for people who are looking for another “defined benefit” type of account – another income stream to add to their social security and pension type payments. Here is how it works:

Some fixed index annuities apply a bonus to your premium in the Income account. It also guarantees that your Income account will grow at a very competitive compound interest rate, guaranteed. PLUS, some fixed index annuities credit all index interest gains in the “account value” to your income account balance.

Is it possible that the income payment to you from the Income account could increase? The answer is “yes!” If interest credits are growing, when added to your Income account, the income base could increase. If that is the case, your income payment could increase. But, remember, the payout can never decrease … no matter how long you live!

Many people don’t want to be locked into the income payout. There might be years when they don’t need money. That is another example of the fixed index annuity’s flexibility. You can stop and start whenever you like.

Now, what about the indices that link to your fixed index annuity account value? They are household names that Americans have turned to for years.

Lifetime income and protection against loss of principal and previous gains. Protection against markets.

Seems like with a fixed index annuity, you can have your cake and eat it, too.

Visit for more information or give us a call at 1-877-844-0900 if you have any questions.

How Much Money You Need To Save To Retire By Age 40

The more you save, the sooner you can retire. But how much do you actually need to save before retiring? Business Insider reporter Lauren Lyons Cole breaks it down in this video.

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Following is a transcript of the video:

First, figure out how much you spend each year, then divide it by 4% (0.04).

This is how much you need to save before retiring.

Once you know your goal, you can leave work as soon as you reach it. But to make this work you have to invest your savings.

You can survive for only 25 years on these savings alone. So if you retired at 40, you would have to start working again at 65. But there's a way to make it stretch even longer.

Continue to invest and earn an average of 5% on your investments each year, then you will have enough to live on for the rest of your life.


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Business Insider is the fastest growing business news site in the US. Our mission: to tell you all you need to know about the big world around you. The BI Video team focuses on technology, strategy and science with an emphasis on unique storytelling and data that appeals to the next generation of leaders – the digital generation.

Find Out How Much Money You Need to Retire | S. 1 Ep. 13

Joe Anderson, CFP® and "Big Al" Clopine, CPA share strategies to help you find out how much money you will need to last through retirement, how much money needs to be saved and how much needs to be accumulated for your specific retirement plan. What's your magic number?

Click here for a Free Retirement Assessment:

So let's take a look at the first method of determining your "magic number"…

1. 8 Times Your Final Pay

Example: $100,000 Income Per Year
Magic Number: $100,000 * 8 = $800,000

Pro: This helps the person close to retirement find out how much they may need for retirement

Con: It does not factor fixed income sources (Social Security & pensions)

Con: It does not help a younger investor understand how much they need to save

2. Saving 15% of Net Salary

Annual Salary: $100K
Annual Take Home Pay: $70k
Annual Savings: $10,500 (15%)
Savings at 6% for 30 Years: $830,000

This method is good to help people start saving more money. Most Americans are not saving nearly this amount and this strategy does not help someone close to retirement see if they are on track or not.

3. 4% Distribution Rule
$100K Desired Retirement Income
$50K Fixed Income
$50K Income Shortfall
$50K Divided by 4% = $ 1,250,000

This method takes into account fixed income sources and is more scientific than other methods. The problems with the 4% rule are that it doesn't apply if you haven't saved, it is dependent on life expectancy, and depends heavily on growth rate.

– When Do I Want to Retire?
– How much do I spend now and how will that change in retirement?
– What variables could change everything? (Unexpected illness, the Premature death of a spouse, Divorce, Bear market, etc.)

If you would like to schedule a free assessment with one of our CFP® professionals, visit:

Make sure to subscribe to our channel for more helpful tips and stay tuned for the next episode of “Your Money, Your Wealth.”

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• Investment Advisory and Financial Planning Services are offered through Pure Financial Advisors, Inc. A Registered Investment Advisor.
• Pure Financial Advisors Inc. does not offer tax or legal advice. Consult with their tax advisor or attorney regarding specific situations.
• Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
• Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.
• All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy.
• Intended for educational purposes only and are not intended as individualized advice or a guarantee that you will achieve a desired result. Before implementing any strategies discussed you should consult your tax and financial advisors.

RETIRING on $300 a month CHEAP Living : Lo de Marcos Jalisco Mexico

Retiring on $300 a month Lo de Marcos Jalisco Mexico Cheap Living.

You could retire now, for as little as $300 per month in Lo de Marcos Jalisco, Mexico 2018? Of course, that means cutting back living Cheap Living on most luxuries and living a relatively simple Retirement lifestyle.

Important warning we DO NOT recommend any Real estate Company in Lo de Marcos.

Expats Retirement in Mexico Goes a lot further.

Retirement Planning Before You actually retires Will allow you to have more money And give you A better quality of life. Retirement planning is so important Before you actually do retire.

In Lo de Marcos, you will feel the essence of a true Mexican town. Wide, calm streets, colorful flowering trees and brilliantly painted façades accompany patient fishermen as they weave their nets, which they will later throw into the sea located at the end of the paved walkway.
“It is a small paradise on Earth,” expresses one of the inhabitants of this corner of the Riviera Nayarit. Here, hotels and villas of the purest Mexican style will welcome you with open arms.
Lo de Marcos is a town with a remodeled gazebo in the downtown and small businesses and restaurants with delicious homemade food and friendly service.

We suggest That youTravel in Mexico Before you decide Where you want to Set up You're Retirement lifestyle.

Some people like the Higher elevations like San Miguel And some people like the beaches Like Mazatlan, And some people like Chapala

Sayulita was "discovered" by roving surfers in the late 1960s with the construction of Mexican Highway 200. Today, Sayulita is a prosperous growing village of approximately 6,000 residents. Hailed as a popular off-the-beaten-path travel destination,

San Pancho Culture San Pancho, as the village of San Francisco, Mexico is affectionately known, has preserved its rural essence and the authenticity of a picturesque Mexican town. Here one can still enjoy the serenity and the principles of old Mexico; where people take the time to chat rather than rushing to do business. Just an hour’s drive north of Puerto Vallarta airport but a world apart, San Pancho sits peacefully upon a wide palm-fringed golden beach wrapped in a lush cloak of the verdant jungle. Quiet cobblestone streets provide visitors and residents a safe haven in which to wander and discover the town, with delightful restaurants close at hand to enjoy a delicious refreshment.

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Moshe Milevsky – Why Annuities?

Moshe Milevsky offers his response to the commonly-asked question: "Why should I invest in annuities?" Mr. Milevsky is a professor of Finance at the Schulich School of Business at York University, Toronto, Canada.

Variable annuities are long-term, tax-deferred investments designed for retirement, involve investment risks and may lose value. Earnings are taxable as ordinary income when distributed and may be subject to a 10% additional tax if withdrawn before age 59½.

Variable annuities are distributed by Jackson National Life Distributors LLC, member FINRA. May not be available in all states, and state variations may apply. This product has limitations and restrictions, including withdrawal charges and excess interest adjustments (interest rate adjustments in New York) where applicable. Jackson® issues other variable annuity products with similar features, benefits, limitations and charges. Discuss them with your representative or contact Jackson for more information. Jackson is the marketing name for Jackson National Life Insurance Company® and Jackson National Life Insurance Company of New York®.

Moshe Milevsky was paid for his commentary. His views do not necessarily reflect those of Jackson.

CMC19072 07/17

Early Retirement: 4 Costly Errors Most Early Retirees Make


Retirement Planning Mistakes: 4 Errors Most Early Retirees Make
Hey Everybody, Dieter Scherer here fee-only financial planner and founder of Realize Your Retirement.
Today we’re talking about the 4 Errors Most Early Retirees Make

Mistake #1: Not planning for health insurance costs before Medicare kicks in
How are going to pay for health insurance before Medicare kicks in?
You generally can’t apply for Medicare benefits before age 65. Most people get
Health insurance through their employer and porting your health insurance through COBRA is expensive and only available for up to 18 months after you terminate employment. So make sure you have a plan in place to take this into account.

Mistake #2: Failure to plan for How much will you need each year?

People generally need more during retirement than the often stated 70% income replacement ratio offered up by many as the gold standard. In practice, I usually see most people spending close to 100% of their pre-retirement income. Most people grossly underestimate the amount of money will need each year, especially when they retire early and are much more active with travel and other activities.

Mistake #3: Not Owning Equities in your portfolio
Simply put, not owning equities in your portfolio will set you up for failure during retirement, especially when you retire early. With interest rates close to zero right now, CDs and bonds will not give you the returns you need to have your portfolio survive all the way through retirement.

Mistake #4: Applying for Social Security at the Wrong Time:
Most people apply for Social Security as soon as they are eligible. If you retire early it might make sense to take Social Security so that you have a larger income each month, but the fact is you need to consider a whole lot of other factors before you apply. These include how long you are expected to live, whether your spouse is eligible for benefits, how much your spouse and you can expect to receive each month and your other sources of retirement income.

To answer these questions I’ve made a free video course available over at, a link will be in the description below. The free course goes through the future of Social Security, the rules of Social Security, and how to maximize Social Security benefits.

I hope today’s video has offered you some good value, if you have any questions or comments, let me know in the comments below.

The Secret to Retirement Planning with Minimal Taxation

Financial planning and taxes in your retirement years does not have to be a scary thing for baby boomers and retirees. In fact, there are very simple ways to safeguard your retirement income from both volatility and taxation. In this video Rob discusses where IRA’s, 401k’s, and 529 Plans fit in the spectrum of taxation and financial planning.

A few of the key topics in this video that you will learn are:

Capital gains versus ordinary income tax
Tax-free versus tax-deferred
Where annuities fit in your retirement plan
How a private pension is a viable alternative investment.

Please subscribe to our channel above to make sure you receive updates on all future retirement videos. We post new retirement videos like this every Tuesday and Friday so please Subscribe now to get instant updates on our upcoming videos.

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