3 Meanings of Living off of Investments on Day to Day

In a world that's quickly moving to all things digital, using the stock market to your advantage can be a significant benefit when paying your monthly bills.

Living off Investments requires you to leverage mutual funds, bonds, and equities to your advantage, helping you sustain your bank account or allow you to accomplish some non-bill-related goals you've set.

Knowing how to take full advantage of the markets, which are currently bearish and great for short-term investors, is the first step in creating a day-to-day financial plan for you and your family.

Here are some of our favorite ways to live off your investment portfolio.

What Does Living off Investments Day to Day Mean?

1. Rule of 100 The idea behind the rule of 100 is that, as an investor, you should hold a percentage of your investment portfolio in stocks based on your age.

2. Dividend A dividend is the distribution of a company's earnings allocated to shareholders. Determined by the company's board of directors, these payouts can be withdrawn in cash or reinvested in additional stock.

While recommended for your first year of retirement, this rule states that you should be able to live off of 4% of your investments each month for that first year. Then you'd increase or decrease that percentage based on inflation and how the markets are fairing.

3. 4% Rule

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