Minimum Lotto winning you could retire on?

[imcatholic]

@jeremymg16 Capital gains tax on lottery winnings is 18% (depending on how it's invested) so you have 41K.

 

[jeremymg16]

@imcatholic Afaik lotto and gambling isn't taxed but once you invest all the returns would be liable to normal tax.

He's talking about sticking 1M into the stock market and living off the dividends (I'm assuming) so income tax or the alternative is he is hoping to sell the gains of the underlying stock value which would be 33% CGT but if you're not working and only income is from stock trading then you're still back to income tax.

 

[imcatholic]

@blessbrenda Most answers on here have no idea how interest and investments work.

 

[resjudicata]

@blessbrenda I'm 36, suppose I could live up to 90, 10M after tax would suffice. That's about 200K a year (after tax). I'm single though, might change if I got a family later on. lol

 

[xemketqualode]

@resjudicata Inflation in that period would destroy the value of a lump sum if you're thinking of it in terms of withdrawing a fixed amount every year. In your example, you're describing 54 years. 54 years ago, €100 was worth €1654 in today's money (https://visual.cso.ie/?body=entity/cpicalculator). If the same inflation occurred in the next 54 years, your €200,000 for the year would be worth €12,092 in today's money.

You're still gonna be grand if you have sensible investments though - at a safe withdrawal rate of 4%, to get the equivalent of €200,000 in today's money every year (growing with inflation each year), you'd need a pot of €5,000,000. Same order of magnitude as what your suggesting, but it's crucial that it's invested, not just taken from.

 

[khadie]

@blessbrenda 3 million would be great. 800,000 prob would be enough for me to retire on but only as I have a house.

 

[sanj79]

@blessbrenda Kind of depends what kind of life you want to have. I would say 5/6 mil would make retirement very very comfortable, but you could probably do it for less - assuming you don't get too caught up in trying to live like a millionaire.

If you won 6 mil for example, take a million to buy a couple of investment properties to rent out so if you did go broke - you can always fall back on them.

Depending how old you are, as lotto winnings are tax free - taking a 100k yearly drawdown would last 40 years. And you still have a good bit left over to play with.

 

[brokenandconfused]

@blessbrenda This I easy to work out. What are you going to earn for the rest of your career?

There’s your answer.

 

[pixielee]

@blessbrenda Depends on your current earnings and major outgoings like a mortgage and kids. Someone earning €100k/year with a mortgage and young two kids needs a lot more cash to sustain that than someone close to retirement with the kids all settled etc. Years ago, I chatted with a hedge fund manager in an airport waiting for a flight and his take on it was this, which I think it pretty accurate. It assumes a couple with young kids:

1 to 2mil - You clear all your existing debts but you're still going to work in the morning. Not much outwardly changes but you have no financial stress to consider. You've basically won a stress free life.

5mil - You can probably afford a little luxury (Second home, have a Ferrari the garage, take a trip or two per year first class etc) and can both retire early.

10mil - You can retire immediately, consider bigger properties and ultra luxuries like a private jet flights within Europe. You'd have a very comfortable life if you spend conservatively.

25mil - Basically live as you want. Provided you weren't playing huge hands in Vegas or being reckless, your set for life, as would be your kids.

For me, the sweet spot is 10m. You're rich enough to do as you want, but not rich enough to potentially start having rich person problems.

 

[whisperxo]

@blessbrenda Only a fools can make any plans basing on lotto winning, and only a fools can count on them. Also, majority of winners end badly. No, sorry, I prefer my own money.

 

[malachi569]

@blessbrenda 2.5m before I'd even consider it. Only would be a definite at 4.

 

[jcromero]

@blessbrenda 1000000 generating 4% interest would leave you with that 1m still in the bank and 40k a year. So 2m should carry me and the wife at current standards.

 

[pastor77]

@blessbrenda Depends on your age. I'm 38yo. I always say to my wife that €1million is alot of money, but if you think about it, it's only €50k for 20 years!!. Still have another 30 years until mandatory retirement at 68yo when I reach it if it stays the same until then. Ideally €2 million, invest it and still work until 50 then retire, but keep a passion going so boredom doesn't kick in.

 

[bb2008]

@blessbrenda 2M would be enough for me.

1M to build a house or to buy one and fix it up to be as energy efficient as possible, also a new car with good long term reliability. Basically a solid base that costs very little to keep running.

The other million would go into a savings account and then set up a monthly direct debit of 3000 to my regular account. 3000x12= 36000 per year = 27 years until I've used it all up in theory but I wouldn't know how to use up 3000 every month so it would last even longer.

 

[kitcatrn]

@blessbrenda To maintain our current state €4m, to reach our expected earnings potential and maintain that, at least €5.5m.