What is your $2m generating? For instance, if you invested in high quality dividend stocks, you can get 3% and it should generally grow about what GDP does (which should also include inflation effects). So that's $60k/year, or after 15% dividend tax + let's say 5% California state tax, for a net of $48k. If you're in somewhere rent-controlled, seems like even with a family you're not going to on the streets starving.
Alternatively, if you have $2m in stocks that are growing, you could consider the growth amount as potential income, because you could always sell it. Generally the growth is better than 3%, but down times will also hurt worse since you might have to sell at a low.
Or you could purchase a residence with $1m, and buy dividends with the rest. Taxes on the residence will be about $10k, with dividend income of $24k, leaving $14k for food, etc.
You won't independently wealthy in any of these scenarios (not in the Bay Area, anyway), but in these scenarios you don't actually need much from a job, maybe $40k with a family. So you should be able to save several years worth of that on a Bay Area salary, which leaves you with quite a long runway.
And if things get really bad, you can move to the middle of nowhere, buy a house for $300k and actually be independently wealthy.
Which will decline as the Fed cuts rates. Longer duration locks in risk free yields longer. Your portfolio goals and allocation will of course drive your strategy.
The 5% HYSA minus the FED-targeted rate of 2% is back to 3%. But high quality dividend companies generally raise their dividend each year, plus you get the increase in stock value. So you only get 3% in income, but your total return is much better.
Alternatively, if you have $2m in stocks that are growing, you could consider the growth amount as potential income, because you could always sell it. Generally the growth is better than 3%, but down times will also hurt worse since you might have to sell at a low.
Or you could purchase a residence with $1m, and buy dividends with the rest. Taxes on the residence will be about $10k, with dividend income of $24k, leaving $14k for food, etc.
You won't independently wealthy in any of these scenarios (not in the Bay Area, anyway), but in these scenarios you don't actually need much from a job, maybe $40k with a family. So you should be able to save several years worth of that on a Bay Area salary, which leaves you with quite a long runway.
And if things get really bad, you can move to the middle of nowhere, buy a house for $300k and actually be independently wealthy.