'Survive Anything': Kevin O'Leary Claims You Need $5 Million in Savings–Here's How You Can Reach That Financial Milestone

Entrepreneur and television personality Kevin O’Leary, widely recognized for his role on the reality television show Shark Tank, has one clear number in mind when it comes to financial security: $5 million. O'Leary believes that if you have this much money invested, you can "survive the rest of your life, no matter what happens."

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How does he arrive at such a figure? Well, quite simple: O’Leary suggests that a $5 million investment could yield 6% to 7% annually, translating into $300,000 to $350,000 in passive income each year. He argues that this amount would sustain a family through all kinds of economic challenges.

However, some financial experts think that O’Leary may be overly optimistic. Many savers prefer the “4% rule,” a more conservative strategy that involves withdrawing 4% of your savings annually. This rule, while conservative, would still generate a substantial $200,000 in passive income from a $5 million nest egg – a figure well above the median household income of the average American family.

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So, how does one go about building that $5 million cushion? Based on his considerable experience, O’Leary offers several suggestions.

“I’ve probably heard more than 10,000 pitches,” O’Leary says, reflecting on his career. “And honestly, most of them sucked.” He underlines the importance of being highly picky when it comes to investments. O’Leary advises potential investors to forget about FOMO on the next big thing and instead thoroughly vet every opportunity. 

O’Leary also emphasizes the importance of focusing on cash flow. Don’t just hope your investments will appreciate over time. Instead, fill your portfolio with hard-asset income, like dividend-paying stocks. This advice is echoed by investment titan Warren Buffett, who famously said, "The first rule of an investment is don't lose [money]. And the second rule is don't forget the first rule."

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Another route could be real estate. O’Leary has mentioned that the sector historically offers high returns, income, and relatively low volatility. Some platforms allow you to invest in rental properties with just a few clicks. These platforms make it easy for investors to purchase shares in pre-vetted properties without the hassle of managing the property themselves.

O’Leary’s final piece of advice is to avoid unnecessary risks. “I like taking risks,” he once said, “but they're calculated risks.” O’Leary urges investors to be fully aware of what they're getting into before parting with their money. He recommends consulting a financial advisor to steer them through the financial investment maze.

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