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What Is The Yearly Interest on 20 Million Dollars? A Lot?

Are you planning to have 20 million dollars saved up before you retire? It sounds like a massive amount of money….but is it really? After all, what is the interest on 20 million dollars?

How long would 20 million dollars last you? Is 20 million dollars rich compared to what everyone else has? These are all great questions, and all questions that we plan to answer in this post!

And, in addition to the above, we’ll talk about a $20 million net worth lifestyle, as well as what to do with 20 million dollars (as in, how to invest it and live off it)!

Sounds interesting, right? It is to me too, which is why I decided to research and write about the topic! Let’s dive in and find out what it really means to have 20 million dollars! 

If you like this article, check out the interest earnings within the posts listed below:

And take a serious look at our Best Investment Apps piece if you’re looking to invest.

What Is The Interest on 20 Million Dollars?

First things first. What could you earn from this wad of cash? What is the interest on 20 million dollars? You first might be asking yourself the question, “How much will institutions pay you in interest on this money?”

In other words, how much interest would a bank pay on 20 million dollars? 

According to the Lake Michigan Credit Union site…

  • Their standard interest rate on a regular savings account is 0.10%
  • If you have $100,000 or more, you could earn 0.50% 
  • And, if you have $250,000 or more, you could earn 0.65%

Beyond the $250,000 amount, there are no more increases to the interest rate. So, let’s say you put all your money in a bank savings account. What would the interest be on 20 million dollars? …How much would it earn with a 0.65% interest rate? 


The answer, $130,000 a year.

Meh. On $20 million, this seems like a pretty paltry amount. Couldn’t you earn a much higher interest rate and a much higher income with $20 million? Absolutely, you can. Keep reading and we’ll show you the options.

What Is the Yearly Interest on 20 Million Dollars?

The question of ‘how much can 20 million dollars generate per year’ is a great one, but it’s not the easiest answer to give since there are so many investment options.

Based on my research and my experience, you can expect to get the below rates for the respective investments.

  • Savings: 0.65%
  • Corporate bond: 2-3%
  • Annuity: 3.5%
  • Certificate of Deposit: 5%
  • Real Estate: 7%
  • S&P 500 Index Fund: 10%

The real estate percentage is my estimate based on the crazy price of homes today (rental rates have not kept up with housing prices). And, the S&P 500 is based on the historical average when including dividend reinvestment.

So now to answer the question of “What is the yearly interest on 20 million dollars?” 

  • With a 0.65% savings account: $130,000 a year
  • 3.5% annuity: $700,000 a year
  • 5% Certificate of Deposit: $1,000,000 a year
  • 7% real estate: $1,400,000 a year
  • And, 10% in S&P 500: $2,000,000 per year

So what is the interest on 20 million dollars annually?

On average…about $700k-$800k a year.

The savings account earnings of $130,000 seems like a waste of time and the S&P 500 earnings looks CRAZY! I mean, earn $2,000,000 a year??! Dang, that would be pretty nice!

Before you go with one option or the other, be sure to factor in the risk element.  A savings account is quite safe. The stock market is definitely less safe, and you could lose 40% of your money in a very short period of time (remember 2020?)!

While you don’t want to be super safe and earn next-to-nothing in interest, you also don’t want to shoot for the moon and put your money at risk of a huge loss! Be sure to mix it up with your investments to stay relatively safe, but earn more than 0.65% a year!


What Is the Interest on 20 Million Dollars Per Month?

What do all these amounts equate to in the shorter term? Like, what is the interest on 20 million dollars per month?

Using the same investment figures as above, here’s how much you would earn each month on 20 million dollars:

  • 0.65% savings account: $10,833 a month
  • 3.5% annuity: $58,333 a month
  • 5% Certificate of Deposit: $83,333 a month
  • 7% real estate: $116,667 a month
  • And, 10% in S&P 500: $166,667 per month

Can You Live Off The Interest of 20 Million Dollars?

So now onto the question of, “Can you live off the interest of 20 million dollars?” Well, that all depends on how much you live on today…and how much you think you need in retirement.

If you’re used to living on $100,000 per year, then you can absolutely live off the interest of $20,000,000. All you’d have to do is earn 1% on 20 million dollars and you would earn $200,000 a year, which is double the amount you’d need! 

The likely annual interest on 20 million dollars

If you invest wisely and have a good mix of the investments above, I would think you could earn an average of 6% pretty easily.

By earning 6% on $20 million, this would earn you $1,200,000 a year!

If you’re used to earning $1 million or less per year, then by having $20 million, your lifestyle wouldn’t need to change and you’d likely never run out of money.

How Long Will 20 Million Dollars Last You?

Before we get too aggressive with our statements though, let’s be absolutely certain that our assumptions are true.

How long will 20 million dollars last you? It’s time to play with some numbers. If we stick with the assumption that we could earn 6% a year, what would some different withdrawal amounts do to that nest egg?

  • Would your withdrawals deplete your nest egg before you died?
  • Or would your nest egg last a long long time? 

Based on your withdrawals, how long will 20 million dollars last?  Can you live off the interest of 20 million dollars? Let’s find out!

How long will 20 million dollars last if you withdraw 1 million dollars a year?

Seems like a crazy question (these are BIG dollar amounts we’re throwing around here), but let’s explore it anyway. “If you withdrew $1 million a year, how long would 20 million dollars last you?”

Based on Calc XML’s online calculator (and investing at 6% a year), your money will actually keep on growing! The nest egg amount would never go down!

After 20 years, you wouldn’t have $20,000,000…You’d have $27,000,000! Well that’s pretty solid!! So, it’s safe to say that anything less than a $1 million withdrawal each year would result in your nest egg increasing over time!

What if we look at some bigger amounts?

How long will 20 million dollars last if you withdraw 1.5 million dollars a year?

Alright, so if you spend $1 million a year on your $20,000,000 nest egg, that pile of money will keep going up in value. But what if you upped the ante a little?

How long will 20 million dollars last if you withdraw 1.5 million dollars a year (roughly $125k a month)?

The answer: 27 years

Well that’s not terrible! If you retired at 65 years old with $20 million and spent $1.5 million a year, you’d run out of money at 92 years old. Chances are, you’re probably not alive at 92, so this might be just about right!

How long will 20 million dollars last if you withdraw 2 million dollars a year?

What if we try to live even more lavishly than $1.5 million a year? What if we withdrew even more?

How long would 20 million dollars last if you withdraw 2 million dollars a year??

The answer: 16 years.

Ok, at this withdraw rate, your nest egg probably wouldn’t last your full retirement, but I’m still a little shocked at how long it could last even if you withdraw a pretty huge sum of $2 million a year!

If you retired at 65 years old with 20 million dollars and withdrew 2 million dollars a year, you would run out of money at 81 years old.

Obviously not ideal, but still not bad! You’d live quite the lavish retirement for those 16 years! 

Is 20 Million Dollars Rich?

Can you believe people ask this question? They want to know if they are considered rich if they are worth 20 million dollars.

Per the chart below, if you were worth just $1 million, you’d be in the top 10% of the population. In other words, if you had a million bucks, I’d consider you rich! And, if you were worth $20 million, you’d easily be in the top 1% of people in the United States.

Again, I’d definitely consider an individual rich if they had 20 million dollars! Are you rich if you have more than 1 million dollars?

The $20 Million Net Worth Lifestyle

What is your lifestyle like if you have 20 million dollars? What’s the norm for this very elite class? According to Oracle’s survey, people with a 20 million dollar net worth…

  • Earn over $400k a year
  • Live in a home that’s worth $600k
  • Rarely watch TV (they are creators, not consumers)
  • Own a luxury SUV
  • Buy upscale apparel
  • Vacation in Australia, New Zealand, and Oceania

Decamillionaires are certainly in another category when it comes to day-to-day living. The $20 million net worth lifestyle is a dream. One that very few of us can fathom. Want to live large? Then maybe shoot for a $20 million nest egg—

What To Do With 20 Million Dollars?

Let’s say you’ve done it. You’ve saved up tens of millions of dollars! Congrats! But now what?…

Would you know what to do with 20 million dollars? How should you spend it? How should you invest 20 million dollars? Will 20 million dollars last in retirement if you were at the helm of the financial ship??

First off, if you had $20 million and you spent it sparingly (think $200k a year), then you really wouldn’t need to do anything with that money to make it last. I mean seriously, if you did spend $200,000 a year and earned zero interest, your $20,000,000 nest egg would last for 100 years! 

How to spend 20 million dollars

Anyone can spend $20 million. Buy a private jet. There. Done. But that’s not what this header means.

Instead, I’m saying, how should you spend 20 million dollars to make it last?

Based on our examples early on in this post, you could spend $1 million per year while earning 6% interest, and your money would grow to $27 million after 20 years. So how can you do that? 

Live luxuriously, but not unwisely. 

  • Buy a super nice house and then stay there for many years
  • Buy a new luxury SUV every few years
  • Purchase a nice boat, but not a 200 foot yacht
  • Go out to eat often, but don’t buy an entire round for the entire bar every night
  • Buy designer clothes, but wear them more than once before you donate them

Like I said, live a great life, but not over the top. With this mentality, you can definitely live on $1 million a year and keep your $20 million nest egg in tact.

How to invest 20 million dollars

If you’re asking what to do with 20 million dollars, you’re probably not wondering how to spend it all. Instead, you’re asking about how to invest it and make it work for you! I

‘m not a trained investor and I can’t tell you what to do with your money, but this really isn’t rocket science.

If you want to earn 6% on your $20 million, here’s what I would do:

  • Invest about a $2M of it in an annuity that earns 3.5%.
  • Over time, develop a solid portfolio of rental properties (maybe 30% of your nest egg). This should earn you at least 7% each year.
  • And finally, I’d put the rest into a simple index fund that represents the total stock market. This has historically earned 10%.

Between those three simple options, over the long-term, you’ll almost certainly earn 6% on average per year. Again, not rocket science, not sophisticated, not confusing. Just simple returns. That’s all you need with such a huge retirement fund!

What Is The Interest on 20 Million Dollars? It’s insane is what it is!!

If you’re targeting $20 million for your retirement fund, you’re going to live a pretty sweet life in your later years.

I mean c’mon, living on $1 million a year for life? That’s a pretty cushy lifestyle! But hey, if that’s what you want, then go out and get it! Earn it. Invest it. Live it. You do you. If you get to the $20 million nest egg, congrats, and God bless!



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