An investor requiring regular income should invest in which of the following

When you first start investing, it's smart to stay within your comfort zone. But if you stay there for too long, only ever putting money into traditional investment vehicles like retirement accounts and index funds, you'll miss out on the opportunity to turn a profit on the wealth you've built. Once you've built up a nest egg, branching into more potentially lucrative opportunities (like investing in startups or real estate investing ) can bring the chance to earn outsized returns. Even if you only increase the average return on your investments by a single percentage point, it can mean bringing in hundreds of thousands of extra dollars over the course of your lifetime. Unfortunately, a lot of these profitable investment opportunities are reserved for accredited investors. Becoming an accredited investor is like getting into the secret, roped-off room in Vegas where people play high-stakes. Bets are high, but if you get lucky, the rewards are even higher. So how do you become an accredited investor? And is it worth it? An accredited investor is a person who is permitted to make investments that are not registered with the U.S Securities and Exchange Commission (SEC). That means gaining access to investment opportunities that regular investors don’t have, like investing in private companies or private real estate investment trusts (REITs). These investments are limited to accredited investors because the SEC has deemed people who meet these requirements to be: • Financially...

While minimum purchase denominations can be less, always use par value ($1,000) for these calculations. A 6-1/4% bond pays $62.50 annually (6-1/4% × $1,000 = $62.50). Therefore, a customer purchasing 5 bonds receives $312.50 each year. As Treasury notes pay semiannually, each interest payment equals $156.25.

Once you hang up your boots, generating a steady income during your retirement years is a crucial requirement, especially if you aren’t privileged enough to receive an inflation-adjusted pension. Here are a few relatively safe avenues for those looking for safe options to generate a post-retirement income stream. We have ignored bank deposits, given the low-interest rates on offer. We skipped Post Office Monthly Income Schemes for the same reason. In this two-part post, we first lay out six safe retirement options for regular income after retirement, then get into asset allocation, tax-efficient income generation, and risk. The six regular income investment options are listed here in ascending order of preference: 6. Immediate annuity plans of insurance companies An immediate annuity is a product offered by insurance companies. You pay a large sum of money to an insurance company. Per your requirement, the insurer provides a pension or a regular income (monthly, quarterly, half-yearly or annually). There is a 1.8% GST charged on the purchase price. You get an assured fixed pension for the rest of your life. Your nominee receives the purchase price or premium paid after you die. Immediate annuity products have many variants. We consider the return of purchase price to the nominee option because all other options mentioned above return the principal amount invested and mostly have a bi-annual interest payout. So, the comparison would be easier with options offering regular i...

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• The internal rate of return (IRR) is the annual rate of growth that an investment is expected to generate. • IRR is calculated using the same concept as net present value (NPV), except it sets the NPV equal to zero. • The ultimate goal of IRR is to identify the rate of discount, which makes the present value of the sum of annual nominal cash inflows equal to the initial net cash outlay for the investment. • IRR is ideal for analyzing capital budgeting projects to understand and compare potential rates of annual return over time. • In addition to being used by companies to determine which capital projects to use, IRR can help investors determine the investment return of various assets. 0 = NPV = ∑ t = 1 T C t ( 1 + I R R ) t − C 0 where: C t = Netcashinflowduringtheperiodt C 0 = Totalinitialinvestmentcosts I R R = Theinternalrateofreturn t = Thenumberoftimeperiods \begin ​ 0 = NPV = t = 1 ∑ T ​ ( 1 + I R R ) t C t ​ ​ − C 0 ​ where: C t ​ = Netcashinflowduringtheperiodt C 0 ​ = Totalinitialinvestmentcosts I R R = Theinternalrateofreturn t = Thenumberoftimeperiods ​ How to Calculate IRR • Using the formula, one would set • The initial investment is always negative because it represents an outflow. • Each subsequent cash flow could be positive or negative, depending on the estimates of what the project delivers or requires as a capital injection in the future. • However, because of the nature of the formula, IRR cannot be easily calculated analyticallyand instead must be ca...