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

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

#431

Post by DanHulton »

Precious little conversation going on here about donating...

Lemme start by putting my cards on the table - I think it's morally wrong to be rich. In a world where people are starving to death for the want of a few dozen dollars a week, people with billion-dollar valuations and extravagances are among the worst people I can think of.

That said, I'm not going to stand here and say "if you don't give it all away, you're evil". It's absolutely a logarithmic thing, and even at $8m, there are a lot of questions and plans you have to make to ensure that you don't do the whole "sudden windfall" thing and end up worse off than before.

But I'm in a similar situation to you (sans windfall), and I know I'd feel awful not using at least some of that money to improve the lot of those less fortunate than myself. I keep a running list of organizations that I personally feel do plenty of good to causes that are important to me and don't just exist to funnel donations into operating expenses, just in case of a big exit or whatever, and I plan to start with 10% of the total and work my way up to as much as I can stand.

So definitely make sure you and your family are taken care of, take things slowly, try to get over the rush. But maybe re-watch Schindler's List, and consider investing as much as you can stand into good causes.

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

#432

Post by zaccus »

seansmccullough wrote: post #390
dlhavema wrote: post #294

Earlier quoted context omitted.

- Make sure my debts are paid, and ensure long term stable income Totally. No need to carry a car loan, mortgage, Credit card debt anything anymore.

Depending on the mortgage rate, it might be better to keep it and invest the money that would have been used to pay off the mortgage instead.

Nah, once you've got 8MM in the bank there's no point worrying about maximizing returns. You've already won. Keep it simple, pay off the house, enjoy life.

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

#434

Post by mdpopescu »

paulcole wrote: post #329
tim333 wrote: post #299

Earlier quoted context omitted.

Retiring is pretty dull at age 43. Maybe work on something you're into but which doesn't necessarily bring in much money. Personally, also having some money, I'm working on startup idea to fix the world etc which currently brings in zero money but is fun. Maybe it'll turn in to something real later, who knows. By the way re investing I recommend mainstream stuff like blue chip stocks, income producing real estate etc…

I "retired" in my mid-20s for about 3 years. I only went back to work when I ran out of money. Describing complete freedom as "dull" is an insane concept to me. You can work out, read, watch TV, go to coffee shops, cook, or even just sit around all day with no commitments.

I agree. I am 46, and my wife was joking a few years ago that we're living a retired's life. (I'm working from home, but at a rate that's about ten times the local average, so it's pretty much whenever I feel like it.)

Complete freedom is amazing.

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

#435

Post by graeme »

First of all, avoid losing it. From what I've read, bad business deals and shady investment managers are the easiest way to lose money. It will be easy to think, at some point "I'm an engineer, I'm smart, I can do this investing thing"

Nope. Index funds are your friend, with reputable institutions, covered by some kind of fraud insurance or regulation. (I don't know how the latter works in your area, but see how your money is protected)

Let's say there is a market crash and you lose 30%. You're still set for life, and it will come back as the market grows. But bad deals, fradulent advisors: they can take 100%.

Do nothing fast, and avoid telling people you have money. Your life sounds nice, this will help you avoid changing that. You have plenty of time, and a wonderful gift that will make the rest of your and your family's life more comfortable :)

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

#438

Post by tekkk »

rsync wrote: post #352
tekkk wrote: post #208

Earlier quoted context omitted.

They are not closely similar. Ponies will die if you dont know how to handle them, money while being gobbled away by inflation will more or less hold its value. It's a smart thing to do learn money-management at any point of your life, even more with a sudden windfall like this. The OP seems like a straightforward guy who isnt really interested in money hence this post. So it's up to him what kind of impact he'd like…

"... money while being gobbled away by inflation will more or less hold its value." This is a false statement. In fact, it is false ipso facto .

It's quite silly to say something is false without providing a logical reasoning. And what is false about that statement, that it will absolutely not hold its value? Sure, but it wasn't my main point.

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

#439

Post by Consultant32452 »

zaccus wrote: post #432
seansmccullough wrote: post #390

Earlier quoted context omitted.

Depending on the mortgage rate, it might be better to keep it and invest the money that would have been used to pay off the mortgage instead.

Nah, once you've got 8MM in the bank there's no point worrying about maximizing returns. You've already won. Keep it simple, pay off the house, enjoy life.

This is exactly right. Mortgage/debt represents risk. Many people do the math on potential returns, but calculate risk as $0, which it definitely is not. I think it helps to consider this transaction in reverse. If you had a paid for house would you mortgage it so you could put that money into an investment account at Schwab? Almost certainly not.
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