I received this great question from an FH Premium subscriber, looking to invest to generate $150,000 a year in passive dividend income.
(some details have been amended to preserve privacy):
Dear FH,
I am seeking your insights on retirement planning. I’m a 59-year-old Singapore PR with $5 million in cash and stocks.
My goal is to retire in 5 years and maintain a comfortable lifestyle with an annual income of $150,000 from my investments.
The income will be supplemented by my wife’s and my CPF payouts.
My investment outlook centers on the following key points:
I’m looking for a mostly passive investment approach, but I’d like to retain some flexibility to take advantage of market opportunities when they arise. I want to ensure the growth of my portfolio outpaces inflation. I want to avoid touching the principal to never outlive my resources, even if I reach 100 years of age I’d like to pass on as much as possible to my children and grandchildren. I’m keen on gaining some exposure to the US market due to its growth potential but am also mindful of foreign exchange risks.
I’d appreciate your guidance on the following:
Asset Allocation: What would be a suitable asset allocation strategy for my situation, balancing growth, income, and risk mitigation while allowing for some tactical adjustments? Investment Vehicles: Which investment vehicles (e.g., index funds, ETFs) would you recommend for gaining exposure to both Singapore and US markets.
Thank you for your time and consideration.
How much risk do you need to take? $150k on $5 million of assets?
The first thing that struck me.
Is that if you have $5 million in investible assets.
And you need to achieve an annual dividend / return of $150,000 a year.
That’s a
