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Ask HN: How do I turn 100K into 1 million?

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Re: Ask HN: How do I turn 100K into 1 million?

#101

Post by tricky »

nearestneighbor wrote: post #42
HeyLaughingBoy wrote: post #32

If you were in the US, I'd suggest real estate. At this point in the real estate cycle, you could probably buy two single homes, or a duplex/triplex and rent it out and have positive cashflow immediately. I used to be a landlord, but sold the house and I sometimes regret that decision since it was bringing in about $400/month with no work on my part. Rental property isn't a bad investment if you're willing to do the…

> At this point in the real estate cycle, you could probably buy two single homes, For $100k? Where in the US would that be?

you could get 10 of them in detroit.

Re: Ask HN: How do I turn 100K into 1 million?

#102

Post by arthurdent »

jimbokun wrote: post #97
arthurdent wrote: post #80

Earlier quoted context omitted.

I'm going to invite a flurry of disagreement here, but I'm just going to say it. Investing is not the answer, trading is. II and SA are phenomenal books, but they are also more relevant to a different time in market history. The basic tenets certainly hold true. (Ben Graham famously loved buying companies under book value. Thats still a winning bet and will continue to be.) Its important to realize the macro picture…

"I have a massive faith in America, but its irresponsible to not consider that times have changed." So diversify with foreign assets.

great idea. that's exactly what you should do if you're insisting on an intelligent investor style value portfolio, and thats what Buffet does.

But the real point is that trading isn't a chump game and the entire notion of "long term holding is the best strategy" is premised on a lot of old notions that predate the current market environment.

Re: Ask HN: How do I turn 100K into 1 million?

#103

Post by joelreymont »

p_h wrote: post #88
joelreymont wrote: post #39

Earlier quoted context omitted.

You are right. I don't need the million euro since I don't know what to spend it on. What I'm looking for is freedom to learn and do new things that interest me. I used to do this by working 6 months out of a year at most but I still don't own a house and don't have a nest egg. Nothing to ensure my family has a comfortable life if, God forbid, anything happens to me. I like your perspective of growing passive income…

Well then for starters maybe you should spend some of that money on life insurance.

I looked into that and was very surprised at how small the payout is. I could buy 500k or 1mm of life insurance in the US from what I remember. Here in Spain it's 50k or 100k or a similarly small amount.

Re: Ask HN: How do I turn 100K into 1 million?

#104

Post by joelreymont »

nagrom wrote: post #87
joelreymont wrote: post #36

Earlier quoted context omitted.

Spanish real estate has been tanking. Over 1.5mm units unsold. I think it's a good time to buy, perhaps towards the end of the year. My wife is a self-employed travel agent catering to the Russian market (I'm Russian/Cuban). I she would love to go into property management, specially if the property is ours. I'm reading about LBOs in "Barbarians at the gate" and I think it's a bit like that. You need to figure out the…

I was in Tenerife earlier this year and I was shocked at the number of properties that were lying around, half completed. It seemed like every cove and beach along the south and west coasts of the island had uncompleted holiday/retirement apartment buildings lying semi-built. I was also amazed that prices in the local agents seemed ridiculously high given the obvious devastation in the market. I would be extremely wa…

Developers are going out of business and don't have money to finish properties. Banks are saddled with large inventory of foreclosed properties and are getting rid of it very slowly, hoping not to show large losses, I think.

The asking prices are set high all over the island in the hope that foreigners will bite. You need an official appraisal by the bank before you get a mortgage and you may then get 80% of the amount.

Asking prices used to be exactly 80% of appraised value or less and people are still clinging to the high prices from the market top. Try negotiating, though, and you'll see prices come down rapidly.

I rented a house a few months ago and the owner wanted 330K or so. I insisted on renting and the owner said that if the price is the problem then he could go down to 290, 280, etc.

It's not even funny how prices in the US are more or less uniform, as if people are aware of property values around them and are trying to price them fairly. No such thing around here as people ask what they want and then negotiate down, down, down.

Re: Ask HN: How do I turn 100K into 1 million?

#105

Post by joelreymont »

HSO wrote: post #85
pdx wrote: post #29

Why do you want a million euro? Are you going to spend one million euro on something? I bet the answer is that you aren't going to spend $1M on anything. You intend to put the $1M in some very safe investment and live off the interest, correct? So you don't really need $1M, what you need is $100K per year passive income. It's the same thing. If you look at your problem that way, things seem more doable. Instead of sp…

When I first read the question, I thought Oh boy, there's going to be some asinine suggestions to this one. But this is one of the most sensible answers I can think of. Seeking to turn 1 buck to 10 in the markets, and quick, sounds like the beginning of a disaster. Reframing the question to one of passive income, one can view the 100K as a sort of financial buffer that can finance or cushion different forays into pas…

We should get in touch!

Re: Ask HN: How do I turn 100K into 1 million?

#106

Post by tansey »

vessenes wrote: post #83
tansey wrote: post #58

Earlier quoted context omitted.

> My timeline is 10 years or less and I could, likely, add 50K a year. Just a quick note here: With 100k in year 1, plus 50k per year after, for a total of 10 years, you need to get about 11.5% annualized return after taxes and fees. Good luck. :)

$50k plus an additional 50k per year at 10% = $1,006,245.8 (compounded annually). What fees are you referring to? Different investments carry different loads, including nearly no load (or one included in calculations), for say real estate or direct stock purchases.

Ah, yeah I was assuming he meant this year (0% interest) plus 9 additional years of x% interest. I see now that I should have given him another year.

Okay, so he only has to return 10% annually. Still extremely difficult. :)

Re: Ask HN: How do I turn 100K into 1 million?

#107

Post by olefoo »

joelreymont wrote: post #15
aaronblohowiak wrote: post #12

Ahoy! Sailing is great, I've got a personal goal to do the SHTP in 2014. You have a terrible investment track record and a good programming track record. Go with your strength. Since you have a short attention span, you should focus on short projects that you can ship quickly. Bring maritime weather / charts to the iphone, I'd buy that :-)

Some of that already exists, check out the App Store. I'm thinking an iPad would make a decent chart plotter, though :-). Now, if I could only find a weather-proof enclosure!

There is a company working on making an iPad enclosure that can be used in the tank with dolphins. I don't know what pressure depth it's supposed to be rated at, but it should be adequate for sailing.

Re: Ask HN: How do I turn 100K into 1 million?

#110

Post by davidw »

arthurdent wrote: post #80
yoseph wrote: post #5

"Trading" is not the answer. "Investing" is. Read The Intelligent Investor and Security Analysis, both by Benjamin Graham; and F Wall Street by Joe Ponzio (His website fwallstreet.com also has a number of gems. Particularly, his post about how to value a business http://www.fwallstreet.com/article/25-calculating-the-value-... ) If you read those materials, you will learn how to invest and using the approaches set out…

I'm going to invite a flurry of disagreement here, but I'm just going to say it. Investing is not the answer, trading is. II and SA are phenomenal books, but they are also more relevant to a different time in market history. The basic tenets certainly hold true. (Ben Graham famously loved buying companies under book value. Thats still a winning bet and will continue to be.) Its important to realize the macro picture…

> Ben Graham famously loved buying companies under book value

I read 'The Snowball' about Buffett, and one of the things he mentions was sitting around compiling these forms about companies to determine their value. Isn't that the kind of thing that's automated these days? And if it's automated, it means someone big is likely doing it better than you can. In other words, Graham had an advantage because he was doing something noone else did at the time, and had some very real costs associated with it (paying people to sift through data) that don't exist today.

But then again, I don't know much about this stuff...

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