Investor With $1 Million Locked For 12 Years Asks ‘What’s The Safest Way To Get Passive Income Without Risking It All?’

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Investor With $1 Million Locked For 12 Years Asks ‘What’s The Safest Way To Get Passive Income Without Risking It All?’

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Erupts: Investor With $1 Million Locked For 12 Years Asks ‘What’s The Safest Way To Get Passive Income Without Risking It All?’

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For many, receiving a trust fund is a life-changing event, providing financial stability and opportunities for growth.

However, managing such a

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requires attentive planning, especially when the plan is to generate

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without risking the principal.

This is the predicament a 35-year-old found himself in when he received the news that he would soon inherit $1 million from a trust. The catch? He cannot touch the principal for 12 years but can invest it and keep the dividends or interest earned.

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user has a full-time job and no significant debt besides a mortgage. He says he is financially comfortable but wants to maximize the potential of this $1 million trust fund, but his main concern is balancing growth with safety as he aims to generate passive income through dividends.

“I’m seeking advice on what would be a good way to invest so that I can receive dividends each year as well as hopefully grow the account as well,” he wrote in his post in

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’s r/Dividends community.

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, Walmart & Target –

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The

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community offered a wealth of advice, so let’s dive into that.

One of the most prevalent suggestions in the comments was to invest in ETFs that focus on dividends.

“[Schwab U.S. Dividend Equity ETF (NYSE:

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)] would give you around $35,000 every year in dividends with an average yearly growth of 6%-10%,” a comment reads.

Replying to this comment, a Redditor agreed and recommended the poster another approach, depending on what his goals are in the long run.

“If you want solid current income with growth, this is the answer. If you don’t need $35,000 a year now and want long-term growth 10+ years from now, [Vanguard S&P 500 ETF (NYSE:

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)].

“70/30 split VOO and SCHD if you want some extra dividend income,” another Redditor suggested.

Trending: Warren Buffett once said, “If you don’t find a way to make money while you sleep, you will work until you die.”

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Some commenters recommended high-yield funds in case the poster is feeling adventurous and is willing to take a bit more risk than some investors.

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“If you just want a high current income and don’t care if your balance goes down over time then one of the yield funds like [JPMorgan Equity Premium Income ETF (NYSE:

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)],” a

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user suggested.

One Redditor highlighted what he would do if he were in the poster’s situation.

“I would just go with SCHD/VOO/ or JEPI. They should give you a nice dividend every year,” he wrote.

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Another comment reads, “JEPI, [JPMorgan Nasdaq Equity Premium Income ETF (NASDAQ:

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)] 50/50. Get $75,000 a year after taxes.”

One particular comment stood out due to the many suggestions for funds and what the commenter has achieved so far. This Redditor also advised the poster to reinvest all dividends he receives.

“Remember, 75% of certified financial planners can’t beat the S&P 500 every year, so you can’t go wrong with VOO. Very low expense ratio. I would add JEPQ, JEPI, SCHD, [Schwab U.S. Large-Cap Growth ETF (NYSE:

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)], [Simplify Volatility Premium ETF (NYSE:

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)], [Amplify CWP Enhanced Dividend Income ETF (NYSE:

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)], [iShares Core Dividend Growth ETF (NASDAQ:

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)], [Putnam BDC Income ETF (NYSE:

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)], [Virtus InfraCap U.S. Preferred Stock ETF (NYSE:

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)], [Vanguard High Dividend Yield ETF (NYSE:

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)], [NEOS S&P 500 High Income ETF (NYSE:

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)], and [iShares Bitcoin Trust (NYSE:

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)]. Personally, I have a seven-figure trading account. What I do is put 25% into VOO, and the remainder in the ones that I just listed. Reinvest all dividends and enjoy your early retirement,” the comment says.

Wondering if your investments can get you to a $5,000,000 nest egg? Speak to a financial advisor today.

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to decide which one is right for you.

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