221–230 of 531 posts
Amazing how many people think $8M is enough to retire, or even that you'd want to. Go travel the world with the family for a while. Clear your head and have a good think about the future.
Um. Come check out https://www.reddit.com/r/leanfire/ but make sure you are sitting down and don't have a heart condition.
You can live on that much, never work again, and still leave a nest egg for your kids' education.
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…
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-...
Put most of it in the stock market. Set aside some cash and use it to improve your everyday life whenever you feel like it. For example, don't fly Economy class if it's crowded and uncomfortable. Spend your holidays in a nice place, better hotel. Eat at better restaurants. But a safer (larger?) car. Do NOT hire a wealth manager or go to some private banking advisors.
this is probably some sort of contra-indicator when average joe off the internet recommends Putting most of your money in the stock market. We must be near the Top of this bull run. This bull market is almost 10 years old. We are overdue for a "breather".
I've been hearing this for years. It's just FUD. Yes, the market will deflate again, but in the long run - and I assume the OP plans for the next 40 and not 3 years - it's hard to beat the stock market with other non-time-consuming investments.
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…
Unless you have serious interests in it, you're likely to be a lazy investor and lean on index funds with some gambling money.
There's a big pit where investment performance tanks between lazy index investors and serious investors. These people simply want to trade on their own invented investing signals and feel like they are doing something. It's a big, easy trap to fall into.
Maybe stay out of index funds until Trump is gone because he's volatile for world politics and the market has likewise been volatile and that swings index funds. Not because you'll lose money long-term (in fact, time in market > timing the market), but because seeing your portfolio drop $300,000 in a week is going to shock you and you might make bad decisions before you've developed resilience to these things. This is because the news is so good at making the world seem like it's going to end while you are treating it as serious investment warnings because you don't have the experience. It's like armageddon calculus.
Definitely don't invest in cryptocurrency though, even with your gambling money.
Is this enough? Then you may retire, if you don't like to work, or switch work to anything else regardless of pay. That is a personal question, talk to your family mostly, and experiment. Volunteer, travel, sabbatical. Take it slow, don't rush. Like something? Build it out gradually, but don't change overnight. Most people don't enjoy permanent vacations for example.
Donate part of the 160k annual budget as you please.
Hire a wealth manager for a few sessions for advice. But managing it yourself is easy if you stick to simple strategies. No need for exotic investment products or a manager.
But, do hire an accountant. Understand your tax obligations first and foremost.
That's your base. From there you can breathe and think about bigger plans.
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…
>> ...allows the recipient time to put together a team of professional advisers... Yeah, because it takes a TEAM of people getting paid to figure out what to do with money. I could accept one financial advisor though I don't know how to select one, but a team sounds a bit like vultures ;-)
There is undeniably a lot of crap in the financial services space. I live in it and I could not agree more. I have to face this down every time someone asks what I do for a living. But this isn't really relevant to whether or not OP should hire an advisor. It just makes the job of finding a good one more difficult. But they exist.
The HN community is mostly made up of DIY types, so there's lots of advice to that effect popping up here. But, much like the infamous Dropbox announcement comment, some people don't want to "get an FTP account, mount it locally with curlftpfs, and then use SVN or CVS on the mounted filesystem", as "trivial" as that might be. Some people just want a little green check mark telling them that their files are synced. I'm 100% pro-DIY for the person who has the capacity mentally and emotionally. (Sidenote: the significance of the emotional capacity peace is severely underestimated by almost everyone). And I will happily tell a prospective client that they don't need me and wouldn't be happy with me if I can see that's who they are.
Finally, most people think my job is making money for people. It's not. I'd argue that one of the most significant pieces of info OP shared was:
> I am freaking out.
That's my job. Talking people down and helping them avoid all the bad advice their getting from family, friends, and internet strangers (there's a lot of GOOD advice here, for the record).
Congrats on your success, OP. Best of luck. $8M is a good thing. Don't freak out.
Earlier quoted context omitted.
This is nuts. They should just take time to pursue things that actually interest them and continue living as they were. The only way you'd spend all this money is if you started doing crazy things like buying speed boats and other such nonsense.
with a wise investment strategy, the guy can spend about $300k per year without losing money in the long term. that's a lot of money, but it's not so much that you can't easily overspend if you're not careful and/or start "seeing green". if his kids end up going to top schools for college, that'll be ~$150k per year right there.
Plus, you need to factor in their future earnings. When people speak of retirement, they really mean just doing something else they're interested in. The likelihood of these activities generating income, at some stage, is substantial.
Also why would anyone need to spend 300k in a year? If you own your house, there's not much to spend other than utilities, food and a couple of holidays... Or am I missing something?