Title: From Grief to Growth Tagline: From Grief to Growth: How Eleanor Transformed a $1.8M Inheritance into a Sustainable Income Stream Problem: Eleanor, a 68-year-old recent widow, inherited a $1.8 million Traditional IRA. Overwhelmed by the responsibility and unfamiliar with investment strategies, she feared making mistakes that could jeopardize her retirement security. Initial recommendations from advisors focused solely on bonds yielding low returns, leaving her worried about inflation eroding her purchasing power. How could Eleanor generate enough income to maintain her lifestyle while preserving her capital and ensuring long-term growth in her IRA? Solution: Eleanor partnered with a Golden Door Asset advisor who utilized the ROE Calculator to identify companies with strong profitability and dividend-paying potential. The advisor filtered for companies with a history of consistent ROE exceeding 15%, indicating efficient capital management and a higher likelihood of sustained dividend payments. They then analyzed these companies' financial statements, using the Times Interest Earned Ratio Calculator to ensure the dividends were sustainable and the companies were financially stable. A diversified portfolio of these high-ROE dividend stocks was constructed within the IRA, balancing growth and income. Furthermore, using the Tax Equivalent Yield calculator allowed Eleanor to compare the after-tax return of the IRA portfolio to taxable investment options, highlighting the tax advantages of keeping the assets within the retirement account. ROI: By focusing on high-ROE dividend stocks, Eleanor increased her annual income from an estimated $36,000 (2% bond yield on $1.8M) to $90,000 (5% dividend yield on $1.8M), a 150% improvement. This added $54,000 annually to her retirement income. The portfolio also benefited from the potential for capital appreciation, further enhancing long-term returns. Additionally, the tax-advantaged nature of the IRA saved her approximately $18,000 annually in taxes, compared to holding similar investments in a taxable account (assuming a 20% tax bracket on dividend income). In total, the ROE-driven strategy added $72,000 annually to Eleanor's financial security. Description: Turning tragedy into financial triumph: See how ROE analysis helped Eleanor identify high-potential dividend stocks and secure her retirement future. Use our ROE Calculator to unlock similar insights. Category: Client Service