hello, my parents are getting divorced. my mom is 64 and on disability. next year, her disability will end, and in the spring, she should receive half the value of the house, around $600k.
what would be the best return on investment she could make? she likely won’t have enough to buy her own home, nor qualify for a mortgage.
edit
thanks for all the input! it seems like the best option is to meet with some financial advisors and money managers. really appreciate everyone’s advice.
3 reasons why giving investment advice to a parent can be tricky:
1/ at her stage, tax-efficient and benefit-optimized retirement planning might be more valuable than investment selection.
2/ unmet expectations on investment returns could strain your relationship.
3/ if you introduce her to something she can’t manage independently, it could leave her vulnerable if you’re unavailable to help.
an advice-only financial planner might be ideal; they would focus on creating a retirement plan without managing the investments directly. the plan could include an annuity or conservative investments, depending on her needs.
for more meaningful answers, we’d need additional information. i recommend talking to a financial planner.
since this is for your mom, does she have legal support to ensure the divorce settlement is fair?
the question is too open-ended. a financial advisor with a focus on retirement would be very helpful.
anyone over 50 should consider a financial advisor. they’ll guide her on when to use RSPs, TFSA strategies, CPP timing, and tax efficiency.
at her age, she may not want to be too invested in equities. consider a lifetime annuity for stability.
she might be eligible for a portion of her ex-spouse’s retirement benefits if applicable and could apply for CPP and OAS. it’s critical not to risk her house funds in volatile investments.
she could potentially get around $24,000 per year from a $600k portfolio if managed properly. alongside cpp and oas, this could provide a sustainable income. maybe 50/50 in equities and fixed income with an advisor’s help.
a 20-year annuity for $600k could pay her around $30k yearly. combined with cpp, oas, and potentially gis, this might provide a steady income. in some parts of canada, affordable condos are also an option.