You cannot do financial planning or anything. Maybe you can get some new clothes or few other necessities but it cannot change the course of your life. You might get better return if you just go to a casino and bet it all on red.
I don’t understand why the researchers thought that this was unexpected result.
Now if they had offered 2k per month for life to these impoverished individuals, then this is where I anticipate to see a step change in their quality of life .
The surprise is that on most subjective well-being metrics, the groups receiving some windfall cash reported significantly worse after getting some extra cash than the control group (equally poor, receiving nothing.)
[1] https://substackcdn.com/image/fetch/w_1456,c_limit,f_auto,q_...
"These findings stand in stark contrast to the (incentivized) predictions of both experts and a nationally representative sample of laypeople, who - depending on the treatment group, outcome, and time period - estimated treatment effect sizes of +0.16 to +0.65 SDs."
Simply invest the 5K and take out regular installments whose size is calculated based on your expected lifespan. Or buy an annuity.
I frequently do that when presented with a lump sum of money - although few others seem to.
I don’t think $16 a month is going to change their lives any more than buying necessities they need now with the $5k, but I guess we’d need another study for that :)
Since you’re not going to live forever, you could draw a bit faster—-but transaction costs are also going to eat into that too.
5k for 20 years with average 6% annual return on investments and 3% annual withdrawals (~$200 per year or less than $20 per month).
With 0% inflation over 20 years, this will yield you $9000 (in 2042 dollars).
The inflation this year is above 5%, and if this trend continues for long, your investment will pretty much evaporate slowly.