I am 55 and will be recieving an early retirement lump sum of 600,000. I need some help on what to do with it to recieve monthy income starting in the next year and the half. I can't be to risky with my choices. I am losing my job and not counting on finding one to soon.
Thanks, Paraman
Do some reading on this site and others, focus on two things.
1) Asset allocation
2) withdraw rate.
Asset allocation is how you define how much risk you take- usually expressed in terms of % stocks and % bonds. There is more than one type of risk, the asset allocation defines how you handle most of the risks, not just one risk in particular.
Withdraw rate is how fast you can tap the money. Usually expessed in terms of % of assets. A 4% withdraw rate is a good place to start (meaning 4% of 600k is 24k per year). If you use withdraw rate to express your expenses, the calculators on this site can help you establish how long the money will last for a given asset allocation.
For example you might see things like 4% withdraw rate and a 60-40 allocation has money lasting 35 years with an 80% success rate.
4% withdraw rate and 40-60 allocation has money lasting 40 years with a 85% success rate.
Or something like that.
How much are your annual expenses?
Do you have any other savings other than the 600k severance?
Are you looking to retire, or bridge the gap until you find more employment?
Can you work part time to supplement income?
What is your SS benefit and when can you start collecting it?