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# Just Moved to EU: Investment Advice Needed

I have recently relocated to the EU and find myself in a financial conundrum. I have come into possession of a lump sum of 500,000 euros, and I am considering investing the entire amount in the S&P 500. My expectation is to achieve an annual return of 7% from this investment. I have devised a plan where I will allocate 3% per annum for personal spending, which will be further divided into monthly withdrawals. The remaining 4% will be reinvested back into the market. I am seeking expert advice on whether this investment strategy is realistic and advisable.

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Apart from investment advice, I am also interested in knowing about popular platforms in the EU that facilitate systematic withdrawal plans. Given my residence in the Netherlands and possession of Italian and South African citizenship, I am looking for investment options that cater to my diverse background and financial needs. I would appreciate any recommendations or insights on suitable platforms that align with my investment goals and preferences.

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View Reference


  • KirovianNL

    The 7% (real) return will be taxed at a 30-40% rate after 2027 so you’ll need to tweak it.

    My bank offers systematic withdrawals or deposits so I assume most banks will have it.

  • Throwawayboxx

    The Netherlands has both inheritance and gift tax, in case relevant in this context you should review this for the relevant tax free amounts or if you will need to pay taxes.

  • PottyZA

    Something to note is that if you’re still a tax resident of South Africa, you may owe SARS taxes on that amount too.

    It’s stupid, I know, but SA operates like the US in that regard. You possibly owe taxes regardless of whether you’ve been living in the country

  • Toutou_routou

    Um, I am rather a newbie, but what’s the point of withdrawing 7% only to reinvest 4% back in? Doesn’t this just accumulate unnecessary transaction cost and potentially taxes (depending on the law in the country of your tax residency)? Why not just withdraw the 3% you are planning to spend? In case you have unexpected expenses, you can always withdraw more..

  • Savings-Leading4618

    I’d DCA the money instead of lump sum.

    Lump sum might be better if market keeps growing. But if the magnificent 7 fail to deliver, the market will fall hard. And it would be quite devastating to have invested so much money just before a fall.

    With DCA you can avoid this if you spread your inversion during various years. Like investing 5k or 7k per month.

  • abroadenco

    So full disclosure, we’re[ a startup in Barcelona](

    focused on financial wellbeing for people living abroad. This isn’t advice, but rather some guidance on your questions.

    What you’re trying to do is a strategy called “growth and income” where you grow part of your portfolio while generating passive income from the remainder.

    The growth part should be familiar enough where you grow your portfolio just like you would if you were fully investing for a long term goal like retirement.

    The income part comes from where you sell a percentage of your portfolio and target to grow it back by that amount over the next twelve months. To do so, you set an achievable target rate (4% is the common benchmark used by financial planners) and look for investments that have a high likelihood of hitting that goal.

    To get an idea, if you were to grow your 500K EUR pot at 4%, you’d generate 20,000 EUR a year or 1,666 EUR a month (all of this is before tax).

    In terms of what you’re planning, it might be worth splitting off your portfolio into different investments based on your two goals: growth and income.

    For growth, if you’re comfortable with the S&P 500 and the risks associated, that might be a good fit considering the historical performance of the index.

    For income, you’ll likely want to look at lower-risk investments that have a higher certainty of hitting the 3% or 4% target you set, particularly if you depend on that income to live. Things like low volatility equity funds and ETFs that invest in government and investment-grade corporate bonds could fit those needs. You should be mindful of currency risk as well since you’ll be looking to reduce volatility and increase certainty.

    In terms of automated providers, that wouldn’t really exist if you’re investing into index funds (ETFs or otherwise) since you have to manage those yourself. You could also check with a robo-advisor to see if they’ll handle that for you.

    Two other points stick out that you should be mindful of:

    * You need to take into account taxes in the Netherlands. As others have mentioned, you might have to pay gift or inheritance tax on the 500K. You’ll also pay capital gains, income tax, or both depending on what investments you use (accumulating funds mean you’d sell your income portfolio and have a capital gain each year; distributing funds would pay dividends/coupons and you’d have to pay income tax). It’s well worth speaking to a tax expert in the Netherlands first so you can find the right investments for your needs.
    * Do you really need to take the income now? Let’s say you’re 35 years old and don’t plan on retiring for another 30 years. You decide to take 300K and turn it into 1,000 EUR a month using the 4% rule (pre-tax). That leaves you with 200K to lump sum invest in the market, and you do that in the S&P 500 which historically gets ~10% annually.
    * That 200K becomes 3,490,000 in 30 years (good for 11,630 EUR a month pre-tax in an income strategy) in a hypothetical return using the historical rate.
    * If you lumpsum invest the entire 500K in the S&P 500 it theoretically returns 8,720,000 EUR or ~29,000 EUR a month if you switch to an income strategy at retirement. In other words, it will cost you 5 million EUR to generate 360,000 EUR using the growth and income strategy before you’re at retirement (which is where this strategy is really useful for most people).

    Of course, these are hypothetical scenarios, but it’s definitely something to think about.

    Hope this helps!

  • xsairon

    wait for NVDIA reports tomorrow, if market doesnt go to shit you can invest a sizeable amount and DCA the rest, if it doesnt turn sour tomorrow the year looks relatively ok, considering its election year too

  • Phantasmalicious

    You can establish a company in Estonia or other EU countries who don’t tax capital gains until you pay dividends.

  • pbanken

    For a variety of reasons, I would suggest buying a broader index than „just“ a S&P 500. There are many more solid, profitable and well-led companies to be found worldwide, and as the saying goes, diversification is the only free lunch in investing.