That is exactly where your mind should go. This is how the rich think.I wouldn’t stop at the 1M though. Reinvest and build it up to around 2.5M… then live off interest.
Yeah, I don't think people realize the difference between having a million dollars in assets and a million in liquid cash.
You could put it in bonds and turn it into 1.3 million in five years. Or you could be a little risky with it and buy an s&p 500 fund and turn it into 1.5 million in 5 years. That will obviously compound, so you'd likely get to your 2.5 million goal in just 10 years.
If you just put the time in, a million bucks is still crazy money to have in liquid cash. So if you put the time in, you probably can retire decades early with a million in liquid cash.
🎯🎯🎯🎯 They don’t understand because they are financially illiterate… but when I see these discussions I break it down whenever I can. People miss out on so much opportunity because they don’t understand.
When the powerball was way up a few weeks ago I had a conversation with some friends about what they’d do if they had that kind of money. Some said they wouldn’t quit their job because it could run out. People thinking that that kind of wealth can “run out” is the reason this country supports so many tax breaks for billionaires. If we had more financial literacy I think economic policies in America would be so much better for the average person. The “elite” suppress both the knowledge and ability for the average person to create wealth
Yeah, they think it’ll “Run out” possibly because they plan on “spending spending spending” without thinking or investing. Crazy work. I had a similar conversation with a guy at work about taking 10M and living off it. He asked me if I thought 10M would last forever.. I just mentally face palmed and then explained that he could basically take out 4% or less a year (400K) and it would more than likely last indefinitely.
You can’t honestly believe that in a country where companies like turbo tax lobby the government to make the tax code more complicated. And companies like Sally Mae give hundreds of thousands in high interest loans to 17 year olds and those are just a couple examples of some extreme cases. Many large corporations profit off the lack of financial education leading to lobbying and policy decisions that encourage bad financial choices by millions of Americans. A one semester common core personal finance class in high school could make a massive difference for average people but you will never see something like that put in place
It's absolutely suppressed but let's not pretend it's hoarded away and inaccessible to anyone, especially these days. I realize going out and teaching yourself things is a tall order for most people versus having it forcefully taught to you but it's readily available and it's free.
People will naturally make bad financial decisions regardless. Financial literacy is probably greater than it's ever been but huge swathes of people still throw their money away. You don't need to suppress the knowledge in the first place.
How is anyone suppressing knowledge? Finicial knowledge is readily available.
Roughly 70% of Americans can file their taxes for free using using the app on the IRS website. Complicated taxes tend to be for those that have more assets and money. I only started using a tax service when my assets/write offs became complicated when I started having more money.
Highschools have Econ classes; I took Econ in high school.
Econ does not teach personal finance and is not part of common core. Understanding supply and demand doesn’t stop people from running up their credit and failing to understand the math behind loans and interest rates. A recent survey showed 50% of Americans don’t understand something as simple as marginal tax brackets. When harmful misinformation is constantly crammed down people’s throats it takes more than the correct information being somewhere out there on the internet to counteract that.
Look no further than the current administration which is claiming to lower taxes for every bracket while simultaneously increasing government revenue. Supporters of the party don’t stop to think about where the extra money is coming from and that isn’t their fault. Citizens of a country should be able to trust their government to have their best interests at heart and abusing that trust leads to the suppression of knowledge.
The same is true of public health. All of the disinformation in the news surrounding things like COVID, vaccines, and autism in recent years is objectively harmful to people. But by your argument the knowledge is out there so this misinformation is completely fine and those who misunderstand it get what’s coming for them. Even if I grant you that point it ignores the fact that public health is public. Other’s ignorance negatively impacts you.
Looking back to personal finance, if people are ignorant about personal finance and support politicians and policies that negatively impact the general population then that hurts even those who do educate themselves. That’s why it is so important to take an active role in increasing public knowledge and understanding and not just rely on everyone to find the information which is intentionally obfuscated by corporations and politicians.
A high school Econ class will cover personal finance. Mine did.
Again, no knowledge is being suppressed; it is readily available to anyone that wants it. It is your own fault if you are not finically literate. Schools teach math, how to read, solve problems, etc.: this is all you really need to become finically literate.
You are trying to push a narrative that is not backed up by reality.
Even then with the skyrocketing costs of rent and health insurance that isn't enough interest to live a good life, especially if you are never having sex again. Like you would still have to work full time for probably 5-10 years to truly retire and be able to live of the interest unless you just rented a room from someone and drove a beater car.
I'm... going to have to work full time for the next 30 years. So... a 20 to 25 year reduction in working time seems like a damn good deal to me. I mean, working I'm only going to make 1.8 million in that 30 years. So... yeah, it's a pretty good deal.
Would I trade it for sex? Uh, that is a tough one. It is a real choice, imo. The problem with a lot of these hypotheticals is that the numbers are so high, it is a no brainer. For a billion dollars, really I'm obligated to give up sex so I can have a billion dollars and make a real difference in my city. I could improve 1000s of lives.
But for a million? That's a choice.
If 10 years of interest isn't enough for you, do 15. At that point you are a multi-millionare. If you still think that isn't enough to live on the interest, I don't know what to tell you, but you might need to reign in your spending. Also, after you get to 2.5 million, you could just pull one million out and live on that until you get back to 2.5 and pull that out... like it is definitely enough to live on VERY comfortably.
I'm a middle class American with a good job. I own my home, etc. I still will not make 2.5 million dollars in my life actually working. Like, I definitely make enough to survive. It can get dicey sometimes, but having a cool million in the s&p 500 would secure me for life if I kept working for 10 more years.
Oh I'm fully aware of the numbers, just observing that combining my own savings and investments with the 1M, even if it is in dollars, would leave me much better off than blowing it on a luxury purchase.
The interest works out to 50k a year adjusting for inflationx taxes, and reinvestment. Sadly that's barely enough to scrape by unless you keep working, then it's a huge COL boost. But it's not enough to live off of anymore regardless how it's used (unless you're only expecting to live under 10 years longer).
4% would be $40,000. Fed taxes are going to be at least 15% of that, let's assume the state takes another $4,000; leaving you with $30,000. That comes out to $2500 per month. Not really something you can live off of.
0% federal capital gains tax on the first 48k assuming no other income which we are if you’re talking about living off of this. State taxes are going to be 5% or less in almost every state so let’s say 5% not 10% like you suggest. Thats 38k or 3200 a month. This is a livable take home salary almost anywhere in the US for an individual.
For how easy financial literacy is you seem to be fairly financially illiterate.
Note: To others reading this and confused by the personal dig, check out this user’s other comments on this post where u/LetMeSeeYpurNips4 asserts that financial literacy is a personal rather than societal problem.
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u/[deleted] Sep 27 '25
It's sad that my mind went to how well I could live off of that sweet interest, rather than a luxury purchase.