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If you suddenly had 5 million dollars today, what would you do with it? (lemmy.world)

submitted 4 weeks ago by KingGordon@lemmy.world to c/asklemmy@lemmy.ml

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[–] historicaldocuments@lemmy.world 1 points 4 weeks ago

Disclaimer: Not an investment advisor and not your investment advisor

Nothing crazy. I wouldn’t try to invest it someway to get mo money, beyond an interest bearing savings account, because chances are good I’d lose it.

The first one is a Vanguard US bond fund that pays around 4% to 5% annual dividend on a monthly basis, and the second one is a Vanguard Total World Stock Market fund (captures a piece of the entire world market). A savings account now is paying around 0.38%. So on $5mil if you put it all in BND it'd pay around $200k annually. In a savings account it'd pay $19k, and savings accounts are only insured up to $250k.

The bond fund is taxed as ordinary income, so you could sit down and decide if something like VTEB would be better than BND (lower yield but 0% federal income taxes). It really doesn't take much to beat a savings account, and it doesn't take long at all to start working around taxes.