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Ask HN: What to do after $8M (all cash, post tax) exit?
441–450 of 531 posts
Re: Ask HN: What to do after $8M (all cash, post tax) exit?
#442Find an ACTEC estate planner who will help you with putting the money in a revocable trust, depending on your state, which may shield it from estate tax for generations to come. So long as you're the only trustee, it's like you holding the money personally. You're married, so you're a safe distance from the lifetime exemption for now, but laws may change. Find a tax attorney who understands estate issues. Sign up at Vanguard and you'll get preferred treatment and access to advisors of many kinds free just because of the amount you hold.
Now for the controversial advice. As far as lifestyle, stick with what you care about. The things available to buy now for the wealthy are not particularly interesting unless you're vacuous and vulgar or your time is extremely valuable. Fractional jet ownership that gets you where you want to go a few hours faster? A huge house that you can fill up with stuff you don't use or care about? A car that speeds up a little faster or looks a little nicer? There’s nothing available now qualitatively inaccessible to someone middle class.
That won’t always be the case. Invest with a strategy that’s been successful if back-tested for 100 years, like total market index, and in 20 or 30 years, there will be extremely interesting things worth buying. Life-extending treatments, trips to space, Chappie-style robots as bodyguards (or dishwashers), brain implants, organ replacements, brain backup services. Things we can’t even imagine. Hold onto your money until there’s something worth buying.
Re: Ask HN: What to do after $8M (all cash, post tax) exit?
#443If you're in the US, check into the QSBS exemption, which can give you a huge tax break on your gains. You can exclude gains, and if you reinvest in other qualified small business stock (angel invest) during a certain window then you can roll over the gains for that portion.
This doesn't mean it's a good idea to angel invest now, just that it lowers the risk a bit. I used to be a tax lawyer and know folks who advise on this; feel free to contact me through my profile if you want to talk further.
Re: Ask HN: What to do after $8M (all cash, post tax) exit?
#444Earlier quoted context omitted.
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.
You didn't retire, you just quit working until you went broke.
That's exactly what retiring is, only with the hope you die before your funds run out.
Re: Ask HN: What to do after $8M (all cash, post tax) exit?
#445First, congratulations.
Second, now you have the not so easy task of running family assets as your #1 job to provide security and freedom for your family.
The most important thing is to educate yourself. Hopefully you enjoy reading macro economic news and investment books. It’s not necessarily to DO anything. It’s often so you have the confidence to not do anything.
Regarding asset allocation, standard allocation to liquid assets will do. Plenty of literature on it.
Running family assets is not about maximizing EV. It’s about minimizing risk of ruin, and asset preservation over asset growth.
The emotional side of investing is often harder than the numbers side of it. Feeling like you’re being judged by others for your newfound wealth is hard too. A support group of peers with similar asset levels who are also searching for balance will be really helpful, though hard to find.
Happy to talk more via email.
Again, congraulations. We all need to get lucky. You deserve it.
Re: Ask HN: What to do after $8M (all cash, post tax) exit?
#446You've more than enough to retire. Invest the money conservatively, retire financially, and do whatever you come up with (side projects that earn you money, community projects that don't, whatever) while enjoying your time with your wife and kids. The latter are most important.
Re: Ask HN: What to do after $8M (all cash, post tax) exit?
#447Unsurprisingly 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…
Agreed with the bogleheads suggestion. I’m a lawyer who does some consulting to people in similar situations, and the mistake that everyone makes is thinking that because it’s a lot of money somehow it has to be treated differently. This is just plain wrong. Resist the urge to hire a fancy money manager or do anything different beyond a celebratory dinner with your family. Don’t tell anyone beyond your wife and very…
"Don’t tell anyone beyond your wife and very trustworthy family about this. Otherwise,you will quickly have lots of 'friends' and family members who “love” you."
I completely agree with this if he had won the lottery. Money found is different than money earned. In this situation though, the OP picked the right startup, put work and effort into making it successful, and was financially compensated for the risk and effort he took. I would say he should own his success; the money is rightfully his.
Re: Ask HN: What to do after $8M (all cash, post tax) exit?
#448Get advisors that are paid by the hour, not on a commission.
Get a tax accountant
As Warren Buffett had demonstrated, simple index funds can outperform more complex investments for a lot less risk
Portfolio theory, don't put all of your eggs in one basket. More than one bank, more than one broker, more than one fund.
Do the boring stuff first. Pension, life-assurance, etc. Then the next most boring, treasury funds, index funds, property Etc. Once you have that in place you could find that investments interest you, you could dabble a bit with a small piece of your fund.
Have you looked at voluntary work? Is there a charity you care about that needs a good project manager/board member?
Owning property can keep you really busy. You can run around fixing stuff, or even mow the grass! Or you can project manage refurbishment or something.
Don't rush. Once your money is spread around a little bit you are under no pressure to do anything at all.
Re: Ask HN: What to do after $8M (all cash, post tax) exit?
#449You're free. Don't take up another job unless you want that. If you want to slouch on your couch, go for it. Want to learn how to sail? You can do that. Want to teach kids how to code? You can do that. Don't put the money into the stock market -- we've been going on a bull run for 10+ years. You've got plenty of cash to wait out a next crash.. it's not going to take another 5 years before a next recession hits. But r…
> DO NOT JUST GIVE IT TO A BANK -- best way to pay a ton of fees
Why you'd have to pay a ton of fees on a heavy deposit?
Re: Ask HN: What to do after $8M (all cash, post tax) exit?
#4501. Sell!
2. Read "Rich Dad, Poor Dad" https://www.amazon.com/s/ref=nb_sb_noss?url=search-alias%3Ds...