Monthly income from windfall lump sum?

C

Cligereen

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Hi All,
I'm looking for a bit of advice regarding using a windfall to allow my wife to stop working.

We are about to receive approx €410,000. We are both aged 45 and both working full time. My wife takes home about €2400 per month. We have a mortgage of about €100,000 on a house currently valued at €425,000. We also have a car loan of about €12,500.
We plan to pay off both the mortgage and the car loan (saving us about €1350 per month). That will leave us with approx. €300,000 left out of the windfall. We have no other debts.

Is there any way we could invest that €310,000 that would provide a monthly income of somewhere near to €1000 per month? If we could get somewhere near to this amount then my wife could give up work.

Maybe we're thinking way off the mark here but I'd be grateful for any advice.

Clig.
 
€1K p.m. is €12K p.a. which is 4% of €300K. Right now you can probably get that on deposit (see the Financial Best Buys forum) although you need to take into account the eroding effects of inflation on the real value of your capital sum. However when you come into a windfall of that size you really should get independent professional advice on, perhaps, how to diversify your investments across a range of asset classes, risk/reward profiles, investment terms etc.
 
Thanks Clubman,
I agree we should get independent financial advice, especially as neither my wife nor I are that financially astute. I was just wondering if the scenario I described was a possibility, which you have confirmed. Apart from deposits are there any other ways to get a monthly income from such a sum?
I would have assumed that this isn't possible from shares, but then I know precious little about that sort of thing.

Clig.
 
Cligereen said:
Apart from deposits are there any other ways to get a monthly income from such a sum?
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Possibly not without taking some risk with your capital sum.
I would have assumed that this isn't possible from shares, but then I know precious little about that sort of thing.
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It may be possible by taking dividends as income or selling shares or units in a unit linked fund along the way for income but with any equity based investment you are into a different risk/reward profile to deposits. Not saying that you shouldn't do this but just pointing this out. Personally I reckon that you should spread the lump sum over a diversified range of investments that match your short, medium and long term goals. To establish what is best would involved a detailed fact find and review of your overall situation. Best done by a professional advisor.
 
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