conversation: User (Somethingssomethin): "So I got a small but significant windfall of cash. After I take out safety money it runs up to ~$1m. I need about 3k a month to continue living how I am an having a job that gets me some spending cash for fun. I would like to know what I should do with it. \n\nHow can this lump sum make me a passive 3k a month. Should I take some of that out for a small business or put it in another form of fixed income investment. I can run the small business no problem and already have ideas on what to type I small business to do. If so how much should I risk. \n\nRight now rent for my room is around 1400 a month. Should I instead buy a home (cheap here is 800k+) and rent rooms out to other people? I build homes for a living and can flip these homes so less of a risk than joe blow as I am GC certified. But if I do buy a house, should I take a partial loan or ask friends to go in on the home with me who already flip rentals for a profit or pay in cash and use the rent income to be interest to myself? \n\n\nIt's safe for now and I don't need to touch it for about a year. Any suggestions? How much should I put into high risk investments. \n\nI know there are many people out there who can take this amount of money and turn it into 10x that in a fairly short amount of time. \n\nHow much risk would you take?\n\nI am 24 single and find happiness in sports and am comfortable to sticking in my age groups standard of living instead I being an asshole about having a little extra cash. I really just want enough money to pay my bills and keep home cooked food on the table. If I want more than that I will work for it. My car is modest and paid in cash will run as long as I change the oil and I have no debt. I would like to however be comfortable enough (300k+income/yr) by the time I turn 30 to have a family if I choose to. \n\nHelp me out!! I have no relatives to ask for help in this. "
  Self: "Read the [Long-Term Investing Start-Up Kit](http://www.bogleheads.org/wiki/Bogleheads%C2%AE_investing_start-up_kit) in the sidebar.\n\nInvest in index funds.\n\nA 4% withdrawal rate which will last forever in a lot of cases will net you 40k a year, approximately $3333 a month.\n\nDon't go the rental route if you know nothing about rental management and don't want to be a landlord. Flipping houses is not the same as knowing how to be a landlord. Learn how to invest, which is much simpler to learn and much more passive.\n\n&gt;I would like to however be comfortable enough (300k+income/yr) by the time I turn 30 to have a family if I choose to.\n\nWhat's your income now? Unless you're already in the six figure range and growing fast (by either being an entrepreneur or small business owner), this seems a little unrealistic. 300k income/yr is also way more money than you'd need to raise a family."
  User (Somethingssomethin): "Income is around 50k from a 9-5 which is just to fill my days  I also have a few side jobs (photography) (tech startup) that are both in the first 6months of creation and are 100% cash In cash out. I'm not taking a loan from my savings and am keeping them lean and mean. No guarantee of either of them becoming successful. \n\nIn your experience what amount of cash would get me to a passive 200-300k/year? It can be my next goal I know it seems unrealistic but I'm young and already have more to work with than what many other  ever have. "
  Self: "Erm, if you want a completely passive 300k, then you'd need a ton of income generating assets, probably more in the 5mil+ range. Easy no risk/less return way to do that would be to just buy up a crap ton of bonds with all your money which would basically guarantee the money flowing in for the next couple decades. Mixing in a little equities would probably net a bit higher ROI for a little more risk.\n\nThat or have enough assets to generate $25k in profits every month. Could start a business and hope it goes viral huge, though there's no guarantees on that. Could own a shit ton of houses, though at a price-to-rent ratio of 15 (sort of the borderline between rent and buying), that'd still require $4.5 million.\n\nHonestly, why the $300k amount though? Do you have plans for what you would spend all that $300k every year? That's far beyond what most people need."
  User (Somethingssomethin): "Private schools, vacations, college, trust fund, having my own fun, 300k seems barely enough. "
  Self: "&gt;Private schools/Colleges\n\nYou're not going to spend 100k on private schools a year.\n\n&gt;Vacations\n\nYou're not going to spend 100k on vacations, unless you're spending all your time on a yacht or something.\n\n&gt;Trust fund\n\nYou've already got a million in the bank, and if you don't withdraw from the principle and have in invested intelligently, you're going to have more money than you know what to do with.\n\n&gt;Having my own fun\n\nHave you even priced out how much you need for your own fun?\n\nMy point with all this is that 300k is a nice goal to aim for, but it really seems like you haven't priced out your needs at all, and that you needn't spend time aiming for an extremely high goal when a lower more attainable goal will work just the same."
  User (Somethingssomethin): "You are thinking small potatoes sir. "
  Self: "Sure, but the point is that from what I'm looking at, you are not a proven investor nor small business owner capable of taking your money and skyrocketing with it. At best, you're some schlep who lucked into a shit ton of money. Do you think you're on the same level of you're "friends" who are capable of 5-10xing a million bucks in 6 years? If you do, you certainly haven't given me cause to think so.\n\nAs such, I can only be realistic here and give you an idea of what an average joe can make off a million with little effort. Thinking small is not a bad thing; it also means thinking safe and making sure you don't overextend yourself and ruin a perfectly good nest egg just because you got greedy and wanted more in life than what life will allow."
  User (Somethingssomethin): "Sorry about it?"
  