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

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131–140 of 531 posts

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

#131

Definitely don't retire without considering it very carefully. Some people do well with (in your case, very, very) early retirement, but many don't at all. Just because it's possible to retire doesn't mean it's necessarily the sensible thing to do.

Retiring is a funny concept. Just because you can suddenly not work doesn't mean you should rest on your laurels. Work is a way to remain occupied, however it is too prescriptive in nature.

Most people would benefit from a "retirement" that involved continuing occupation but in a wider variety of roles, with greater freedom to chop and change.

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

#132

It may feel like infinite money, but can be burned through at terrifying speed. This happens to a lot of people who suddenly get money. My advice is do nothing with it, and start reading books about finance, investing, and money management. Then start gradually investing it as you learn the ropes. Hire a good CPA to help you with taxes. Buy liability insurance, because you're now a target for jackpot lawsuits. Don't…

This. Buy liability insurance. It's cheap and sadly, you are now a worthwhile target.

In some places, liability can be based on lifetime earning potential, so OP may have already been a good candidate for liability insurance. Don’t wait for a windfall.

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

#133

You know what? You don't need to do anything for now. What you need to do over the next few months is answer a single question: "What do I want to do with my life?"

> "What do I want to do with my life?"

That's a hard question without the $8M too :)

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

#134
That's awesome, congratulations!

If you're not already familiar with FIRE (financial independence, retire early) then check out these subreddits:

* http://reddit.com/r/financialindependence

* https://www.reddit.com/r/fatFIRE

Most people use a safe withdrawal rate of around 4%. If you retire at 50-60 and invest your money in index funds, you can withdraw around 4% per year if you want to end up with $0 just before you die. If you use a much more conservative rate of 3% and minimize your expenses during a market downturn, then your assets should actually continue to grow while providing you with a steady annual income.

$8,000,000 * 3% = $240,000 per year

So the first thing to realize is that this does not make you ultra-rich. There are plenty of people working at tech companies (especially managers) who are earning around $240k per year. However, this means you can earn the same annual income without ever working again for the rest of your life. Don't buy a bigger house or a few new cars before you think about this carefully. It would be very easy to inflate your lifestyle or send your kids to much better schools, and then you would just have to keep working to pay all your bills (and you probably wouldn't be any happier.)

I don't think you need to hire a financial advisor. $8M is a lot of money, but it's not too much to invest by yourself. If I were in your shoes, I would put a lot of the money in index funds (VOO - Vanguard S&P 500).

Also you should really ask yourself if you need more than $8M, or if $240k per year for the rest of your life is plenty of money. If so, I would avoid any risky investments, because you need them. If you want to do some angel investing or buy some Bitcoin, do it with no more than 5% of your assets, and just because it's fun. Don't purchase any rental properties unless you want to deal with maintenance and tenants. And definitely don't be tempted to start your own company and invest a lot of your own money. You would be taking on a huge amount of risk for no reason. It's very easy to lose all of your money that way.

Anyway, I should try to answer your questions:

* Should I donate it?

Yes, that would be great. If you want someone to recommend numbers, then I'd recommend an initial donation of $1M, and then 10-20% of your annual investment income.

* Should I hire a personal wealth manager?

No, I don't think that's necessary. A lot of them end up charging really high fees for below-market returns. I would start looking for a good financial advisor around $25M. But you should definitely find a good accountant.

* Should I retire?

Yes, definitely. At the very least, find some work that you enjoy. Don't just keep going into work because it's what you've always done.

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

#135
post #99

If you are unsure then sit on it for a few years. That is barely enough money to retire comfortably the rest of your life. If you truly feel giving it away makes the world a better place then why not. Chances are though you using it to better your life and find your niche would further enrich those you came into contact with. Do not feel guilty about having money that you actually earned. It is not like you got rich…

Is this trolling? How much money do you spend per month lol?!

The OP could buy a 1M house and still have enough left for $14.5k per month salary for 40 years...

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

#136
post #128

It may feel like infinite money, but can be burned through at terrifying speed. This happens to a lot of people who suddenly get money. My advice is do nothing with it, and start reading books about finance, investing, and money management. Then start gradually investing it as you learn the ropes. Hire a good CPA to help you with taxes. Buy liability insurance, because you're now a target for jackpot lawsuits. Don't…

> My advice is do nothing with it, and start reading books about finance, investing, and money management. I see where you are coming from, but if you step back for a second, this just sounds bizarre. OP now has more money than they need or ever have had, and instead of relaxing and finally caring about something other than money, you suggest they actually start caring more about money.

>you suggest they actually start caring more about money.

This is how the rich stay rich. You can't just spend (I mean, you can if you're really disciplined and treat it like a retirement income). When you've got a lot of money you need to park your money somewhere it appreciates and then skim off some of the appreciated amount when you want to use it.

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

#137
Put aside enough for your kids college education. Put aside a year’s living expenses.

Donate a small sum to charity.

Do you really have much left after that? Kids are expensive.

Unless you are ready to stop working I wouldn’t retire - enjoy some time off and do what you love now that you have options. Thank the lord for your blessings.

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

#139

There are problems that money can not solve, but Artificial General Intelligence would solve. Think about an artificial intelligence that could learn about health, chemestry, microbiology, develop and apply medical knowledge much faster than humans do, with no limits. So I would work on Artificial General Intelligence, with a team of neural network programmers and computational neuroscientists to develop the required…

I think you are vastly underestimating the amount of money this requires.

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

#140
post #128

It may feel like infinite money, but can be burned through at terrifying speed. This happens to a lot of people who suddenly get money. My advice is do nothing with it, and start reading books about finance, investing, and money management. Then start gradually investing it as you learn the ropes. Hire a good CPA to help you with taxes. Buy liability insurance, because you're now a target for jackpot lawsuits. Don't…

> My advice is do nothing with it, and start reading books about finance, investing, and money management. I see where you are coming from, but if you step back for a second, this just sounds bizarre. OP now has more money than they need or ever have had, and instead of relaxing and finally caring about something other than money, you suggest they actually start caring more about money.

Yeah, try to ignore the fact that it's money; imagine it's some other asset the person wants to keep, like 100 ponies.

You would definitely suggest reading up on how to successfully keep ponies, right?

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