Dealing with Inflation

[TK21]

Let's say my Money System Target is 10,000,000$.
Let's assume a 3% yield on that $10 million, which means an income of $25,000 a month.
With 3% inflation per year, in 10 years 25,000$ will equal $18,602.35 of purchasing power.
What is the solution here? Diversify the money into stocks that historically win inflation over time?

 

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[PureA]

Assets typically track with inflation

 

[TK21]

Assets typically track with inflation

That's a good point. I didn't think about it.

 

[Nevera]

I am also having a hard time on where do I invest this year's savings.
S&P 500, ATH. Gold ATH. Real estate where I live also all-time-high! BTC had a correction since it's ATH peek from March 2024.

Do we just keep dollar cost averaging the Index?

Right now, I am looking for some real estate in a part of country I live in, that still hasn't exploded. (For example, apartment my wife and I live in which we bought in 2019 is now practically going for double the price).

Touche, I just found this. Probably my answer: INVESTING - I have $X thousands to invest, what do I do? What book do I read?

 

[Kevin88660]

Let's say my Money System Target is 10,000,000$.
Let's assume a 3% yield on that $10 million, which means an income of $25,000 a month.
With 3% inflation per year, in 10 years 25,000$ will equal $18,602.35 of purchasing power.
What is the solution here? Diversify the money into stocks that historically win inflation over time?

In short invest wisely.

You are making a goal of only spending the interest and not touching the capital. In real life very few aim to leave a 100 percent inheritance and only spending the capital, unless the capital is so huge that it’s hard even to spend the interest.

It’s okay to have capital depletion along your life stage. Spend a bit more than 25k later in life you can still leave 5-7M to your kids.

Depends when are you having to make the decision on investing the ten million. It’s easy to do in a high interest rate environment now when even T-bills pay 5 percent.