What can a million dollars buy you?
$1 million in a diversified portfolio could help finance part of your retirement.
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A million-dollars. Sounds like a lot doesn’t it? Well, it is.
A million 1 dollar bills stacked one on top of the other would reach 358 feet or the height of a 35 story building. It’s a lot of money.
These days, however, a million dollars doesn’t buy what it used to.
In 1900, the luxury Steam Liner, Hendrick Hudson was built for $1 million, as was the largest private residence in Chicago, the Palmer Mansion.
So what can a million dollars buy you now?
Well, you couldn’t buy a Steam Liner but you could buy a luxury sailboat. It might not buy you a mansion in Chicago, but you could get a condo in Lake Michigan or a million dollars in a diversified portfolio could help finance part of your retirement, offering both growth and income.
Let’s see how this works.
Say a couple retired at 65 with a $1 million investment portfolio. During their retirement years from age 65 to 90 the money could generate a $45,000 annual income, increasing at 3% a year assuming a hypothetical 5% annual rate of return.
At age 90, the portfolio would have an ending balance of nearly $500,000.
What’s more, the portfolio would have generated $1.6 million in total income.
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