Live data from Hacker News

Ask HN: What to do after $8M (all cash, post tax) exit?

news.ycombinator.com

241–250 of 531 posts

Re: Ask HN: What to do after $8M (all cash, post tax) exit?

#241
post #78

Firstly, congratulations! You sound very level-headed about it all which is refreshing. If you're UK-based I'd withdraw it all and hide it in a safe... FCS only protects up to about £70k (from memory) and who knows what state the banks will be in post brexit!?

If you're UK-based I'd withdraw it all and hide it in a safe... FCS only protects up to about £70k OP almost certainly isn't in the UK, but even if so, you spread it around numerous banks and different asset categories (stocks, gold, bonds) rather than risk it all in a safe. Even just dumping £1m into an NS&I Income Bond would keep it pretty safe. I'd personally diversify as much as possible and buy into a variety of…

You're almost certainly right, I was being a little flippant.

Re: Ask HN: What to do after $8M (all cash, post tax) exit?

#242
I came into a windfall about a year ago. I found that it's easy to fall in a rut. Having so much money made me feel like that what what other people perceive as the biggest thing about me. I miss the praise and respect that a job well done gave me, that I had while working. After retiring, it's easy to think that, besides the money there is nothing worthwhile about me.

Then there is the question about what to do when meeting new people and they ask what I do? Tell the truth, and I create this weird social dynamic. Mutter “computer programmer” and I've just stunted any possibility of a real longterm connection by not describing who I truly am. Not sure what can be done about this, except say to prepare for loneliness.

The other piece of advice is to get deeply involved in learning something or creating something. I was amazed by how much the feeling of accomplishment gave me happiness and contentment over going to a fine restaurant or buying expensive clothes.

Re: Ask HN: What to do after $8M (all cash, post tax) exit?

#245
Wait for a market washout. There may be a big one coming. Then, invest it in stocks that increase their dividend every year. But say don't borrow money, or perform some other kind of financial engineering, to cover their dividend. These are the companies that are making money and are proven winners. Then let the money sit year after year after year. Unless something drastically bad about the company's business has changed.

Re: Ask HN: What to do after $8M (all cash, post tax) exit?

#248
My two cents:

First, Congratulations.

Second, breathe. Take your time. If you are still stressed about it, talk to someone IRL. It will really help to get the weight off your shoulder.

Third, beware of self-doubt. It sounds contrarian but I see lots of people who have a big win - money, beautiful girlfriend - start to doubt if they ever deserve any of it. They tend to go the "I am not that great. It is just a case of being lucky". And my answer is - You deserve it. You worked for it. You are awesome. Believe that.

Fourth, take your time understanding your options.

IMO, Bogle heads is a good start: https://www.bogleheads.org/wiki/Managing_a_windfall

Re: Ask HN: What to do after $8M (all cash, post tax) exit?

#249
post #223

Unsurprisingly lots of people have been in similar situations, so there is a Wiki article on one of the Internet's best personal finance and investing websites: "Managing a windfall" https://www.bogleheads.org/wiki/Managing_a_windfall "Do nothing rash. Set aside one year's living expenses[note 2] and place the rest of the windfall into low risk investments (FDIC insured accounts, money market funds, treasury bills) f…

> Unsurprisingly lots of people have been in similar situations According to this article[1], you need $8.4 million to be in the top 1% of net worth so 1 out of 100 HN lurkers can probably also give useful first hand advice! (assuming being rich doesn't make you less likely to visit HN) [1] https://economix.blogs.nytimes.com/2012/01/17/measuring-the-...

Judging by the already pre-selected crowd here, it's likely more than 1/100.

Re: Ask HN: What to do after $8M (all cash, post tax) exit?

#250
First of all, congratulations! I've had a similar situation (with less money) but still, I went through the exact same exercise. You have 2 choices basically, you can keep working or you can retire.

When I say keep working I mean working for someone. Let someone dictate your day, week and year. Some people need structure in life to function properly so if you're one of them, I'd highly recommend you to get another job at another company in order to learn new things. Ideally, you'd study a new position in between so you wouldn't get bored too quickly. Switch to Product, design, or dev for example. You're not chasing for high incomes so that allows you to come in as an "entry level". You seem to be humble so that could fit you well. But definitely look for new challenges since you'll be spending most of your time at work. There's also the entrepreneurial route but I'd put that into the second bucket.

Retirement. Unfortunately, unlike you, I could not simply retire from the 9-5 life. When I say retirement I mean not having to work for anyone. What I would do is to work on my own projects and take a year or 2 to explore different domains and ideas until I'd find something promising I'd be deeply passionate about. Needless to say you'd be learning every day.

In terms of what to do with your money? Here is exactly what I'd do personally. I'd put $5 million into government bonds with a 100% guaranteed return of about 2.5-3%. That would bring you about $150k of passive income per year for the rest of your life (based on inflation rate). That's it! I'd move to a not too expensive place and I'd still have $3 million dollars left. I'd actually split it in 3 in your case. $1 million for each of your kids. For each kid I'd split it like this: 50% into a more aggressive portfolio like stocks, then 50% into bonds. I don't know how old your kids are but the idea is to lock these accounts until they get old enough to understand the value of money. With your million dollar left, I'd buy a new house for about $300-400k. Then I'd leave the rest into a savings account to be used for fun, big purchases, etc.

Post reply on HN