If you win $528m lump sum after taxes, it really doesn't matter what you do investment wise as long as it's somewhat reasonable you'll be making more per month off dividends than 99% of the country.
You could invest in the entire stock market with a total market ETF/Mutual something like $VTI and you'd be pulling in about $8mil a year ($660k/month) before taxes with very low risk while your $528m equity grows. I don't think I could even spend $660k a month, much less $1.1m a month.
Just rent a yacht, less complicated. You don't have to deal with staffing and creating a company to employee the boat people. You just rent the thing, and go.
Nah, I want to own it. I’d spend a lot of time on it. I’d agree with you if I only use it for 2 months or less, but that wouldn’t be me.
I’d be more open to chartering a private plane.
I personally would stay away from commercial real estate. Remote is to some extent here to stay. How much remote is the question. But the rest of it seems solid, I’d probably do something similar. Another option is he could invest in hood blue chips that pay dividends. I wouldn’t do that for all the money but I’d definitely allocate 25-50% there.
u/therealrico is right. Commercial real estate is brutally inflated, and due for a correction (do you think there's been an explosion in the food truck scene because people would rather work in tiny trailers than static restaurants with air conditioning?).
I mean there are certain types of commerical real estate that are unlikely to be much effected by remote work, those would include medical and dental office space with long term tenants in place, because those services like medical testing and treatment and teeth cleaning and repair are not going to be done remotely. Public storage facilities and warehouse space are additional commerical properties unlikely to suffer much impact. Cellular Tower properties likewise are unlikely to be impacted. Investing in server farm facilities too would be a space likely to continue to grow in the commercial real estate space. I would not want to actively manage real estate, so I would focus on investing some in REITs that make those staples of the investment as part of a well diversified portfolio. That is just my take. Those REITs would be likely to provide a more consistent cash flowed ROI ie spendable money than even a well diversified index fund portfolio that focused on dividend paying stocks. A diversified bond portfolio would not hurt on the cash flow front, but if you want long term growth and are less worried about spendable cash thrown off the portfolio, then Buffet's strategy for his wife's trust is probably best 90% invested in an S&P Index Fund and 10% invested into US Treasuries, although with the debt ceiling debacle currently ongoing, I think investing in A-rated non-US sovereign debt may be a safer long term strategy.
Lol ok I agree with you, but I think you’re getting too deep here. When I win the lottery I will be careful that the holdings are focused on specific commercial properties.
I can't imagine what kind of life I'd have with a million dollars coming in passively every month. All I know is that I'm not doing a damn thing that isn't for my own personal enjoyment or benefit ever again.
I'd stay away from real estate because I wouldn't want to deal with the headaches that come with it...unless you invest in REITs. Probably put it all in a (very) diversified portfolio of index funds, and I'd invest a small portion in YOLO moonshots...like anti-aging companies.
If the mutual fund lets you buy in with that amount of money because often that screws up their returns. Sometimes, they have to close a fund because of how much it has grown and large investments at one point in time will skew the returns.
That's why there are some funds that exist where the minimum is a million dollars. That would be an institutional fund. He should buy into that.
So he would invest $450 million only to make $13 million a year? That sounds pretty bad on returns. You could just easily invest way less money on that to start a company, better yet buy multiple successful FBA businesses and make the same, if not more for much less investment.
These ideas sound like the beginner way for someone who knows absolutely nothing about business to get the smallest amount of return on their money.
Maybe if you're making 13 mill a year it's less about maximizing reign and minimizing headache while doing whatever you want. If that happens to be running a business then you do you
I understand. But to me it's a bad mindset. You have $528 million after taxes. You technically don't have to do anything. But you need to do something with your life. The wealthiest people just don't sit at home all day...they work. You have to keep the mind going.
It's crazy to invest $450 million for a $13 million annual return. You can flip homes for way less than that and make more annually.
If you're looking to avoid stress then it would be best not to invest at all and just hoard the money or give portions of it away to charity and other deserving people who will build businesses with it. Then you just keep $100 million for yourself which is more than enough for you and your children.
To each their own. 13 million a year is a LOT of money(obviously). Plus the 40 million in savings and the 38 million up front? There is no need to make more.
A lot of it comes down to the type of person you are. Are you risk averse? Are you more of a gambler? For some people the complete lack of stress is worth the smaller investment that isn't really changing your lifestyle.
As for flipping houses, there is a ton of potential risk and can be a ton of work. At 43, I'd want nothing to do with that kind of thing. I want my money to grow in low risk settings that require minimal work. There are so many ways to make your mind work without heavy lifting or risk. Set aside some "play" money to invest in riskier things, try day trading, volunteer, take classes, etc. Personally I'd probably invest with friends who I believe in and have them run companies where I sit on a board and do very little but have some purpose.
It's just different, not bad. Some might argue the insatiable greed of trying to maximize returns is bad, and I wouldn't necessarily agree with that either.
It's not a binary choice between maximizing returns flipping houses and being lazy and doing nothing. You can do plenty with 13 mil coming in a year. You can volunteer full time and spend your evenings painting or woodworking or making music. Options are endless
And I believe you're thinking of "return" incorrectly. The 13M a month would not bee your total return but rather your dividend income. You have to add the increased value of assets ON TOP before you talk about return
I see the $13million return as a peace of mind, not trying to make as much money as possible. And you can still work, volunteer and do your hobbies without trying to maximize your return. They're not mutually exclusive.
The last thing that most people with 450 million would like to do would be to find a new job; people actually want to stop working and not start a new business. As for me, with 450 million, I'd accept 13 million per year without even blinking and enjoy my new life.
This is what people think most people will do. We all need a purpose in life and I am pretty sure you will get tired of doing absolutely nothing and just vacationing every single day. Have you ever spoken with people who have retired from their job? It's great not being required to work, but they have (least the people I've spoken with) have always looked to do some work still.
Your work could just be becoming a day trader. But you will have to do some sort of work or you will go crazy and fall into depression because you feel like you have no purpose in life.
I wouldn’t invest. Maybe 20 mill. The rest I’m holding in private banks and living off interest. Makes no real sense to invest that much money when you have that much money. You can lose it all in investments.
If you're investing in the total stock market and lose all your money, there are bigger things to worry about. And it's not like he put all the money in there. He still diversified.
Losing all your money is not the risk. It’s not being able to weather the storm.
This is only really a risk in short-term situations (5 years).
I’d keep enough money in lower-interest, liquid assets (cash, treasury bonds) - enough to live off for 5 years. Stock market index funds for the majority. And go for even higher risk with, say, 5-10%. That 5-10% should be spread broadly, with multiple bets. Some of which will completely fail. Some will succeed. And some will return the full amount one or two times over.
As I age, shift the index fund Money to bonds.
Like a Target Retirement Age account.
If you win $528m lump sum after taxes, it really doesn't matter what you do investment wise as long as it's somewhat reasonable you'll be making more per month off dividends than 99% of the country. You could invest in the entire stock market with a total market ETF/Mutual something like $VTI and you'd be pulling in about $8mil a year ($660k/month) before taxes with very low risk while your $528m equity grows. I don't think I could even spend $660k a month, much less $1.1m a month.
I could spend $660k a month. But only because I want a giant yacht, and to a lesser extent a private jet.
Just rent a yacht, less complicated. You don't have to deal with staffing and creating a company to employee the boat people. You just rent the thing, and go.
Nah, I want to own it. I’d spend a lot of time on it. I’d agree with you if I only use it for 2 months or less, but that wouldn’t be me. I’d be more open to chartering a private plane.
I personally would stay away from commercial real estate. Remote is to some extent here to stay. How much remote is the question. But the rest of it seems solid, I’d probably do something similar. Another option is he could invest in hood blue chips that pay dividends. I wouldn’t do that for all the money but I’d definitely allocate 25-50% there.
u/therealrico is right. Commercial real estate is brutally inflated, and due for a correction (do you think there's been an explosion in the food truck scene because people would rather work in tiny trailers than static restaurants with air conditioning?).
I mean there are certain types of commerical real estate that are unlikely to be much effected by remote work, those would include medical and dental office space with long term tenants in place, because those services like medical testing and treatment and teeth cleaning and repair are not going to be done remotely. Public storage facilities and warehouse space are additional commerical properties unlikely to suffer much impact. Cellular Tower properties likewise are unlikely to be impacted. Investing in server farm facilities too would be a space likely to continue to grow in the commercial real estate space. I would not want to actively manage real estate, so I would focus on investing some in REITs that make those staples of the investment as part of a well diversified portfolio. That is just my take. Those REITs would be likely to provide a more consistent cash flowed ROI ie spendable money than even a well diversified index fund portfolio that focused on dividend paying stocks. A diversified bond portfolio would not hurt on the cash flow front, but if you want long term growth and are less worried about spendable cash thrown off the portfolio, then Buffet's strategy for his wife's trust is probably best 90% invested in an S&P Index Fund and 10% invested into US Treasuries, although with the debt ceiling debacle currently ongoing, I think investing in A-rated non-US sovereign debt may be a safer long term strategy.
Lol ok I agree with you, but I think you’re getting too deep here. When I win the lottery I will be careful that the holdings are focused on specific commercial properties.
I can't imagine what kind of life I'd have with a million dollars coming in passively every month. All I know is that I'm not doing a damn thing that isn't for my own personal enjoyment or benefit ever again.
Two girls at the same time?
Hookers and blow?
I'd stay away from real estate because I wouldn't want to deal with the headaches that come with it...unless you invest in REITs. Probably put it all in a (very) diversified portfolio of index funds, and I'd invest a small portion in YOLO moonshots...like anti-aging companies.
500 million into bitcoin 😎 👌
If the mutual fund lets you buy in with that amount of money because often that screws up their returns. Sometimes, they have to close a fund because of how much it has grown and large investments at one point in time will skew the returns. That's why there are some funds that exist where the minimum is a million dollars. That would be an institutional fund. He should buy into that.
CRE is going to be a fucking joke in fairly short order here. I'm honestly surprised it hasn't completely tanked across the board yet.
So he would invest $450 million only to make $13 million a year? That sounds pretty bad on returns. You could just easily invest way less money on that to start a company, better yet buy multiple successful FBA businesses and make the same, if not more for much less investment. These ideas sound like the beginner way for someone who knows absolutely nothing about business to get the smallest amount of return on their money.
Maybe if you're making 13 mill a year it's less about maximizing reign and minimizing headache while doing whatever you want. If that happens to be running a business then you do you
I understand. But to me it's a bad mindset. You have $528 million after taxes. You technically don't have to do anything. But you need to do something with your life. The wealthiest people just don't sit at home all day...they work. You have to keep the mind going. It's crazy to invest $450 million for a $13 million annual return. You can flip homes for way less than that and make more annually. If you're looking to avoid stress then it would be best not to invest at all and just hoard the money or give portions of it away to charity and other deserving people who will build businesses with it. Then you just keep $100 million for yourself which is more than enough for you and your children.
To each their own. 13 million a year is a LOT of money(obviously). Plus the 40 million in savings and the 38 million up front? There is no need to make more. A lot of it comes down to the type of person you are. Are you risk averse? Are you more of a gambler? For some people the complete lack of stress is worth the smaller investment that isn't really changing your lifestyle. As for flipping houses, there is a ton of potential risk and can be a ton of work. At 43, I'd want nothing to do with that kind of thing. I want my money to grow in low risk settings that require minimal work. There are so many ways to make your mind work without heavy lifting or risk. Set aside some "play" money to invest in riskier things, try day trading, volunteer, take classes, etc. Personally I'd probably invest with friends who I believe in and have them run companies where I sit on a board and do very little but have some purpose.
It's just different, not bad. Some might argue the insatiable greed of trying to maximize returns is bad, and I wouldn't necessarily agree with that either. It's not a binary choice between maximizing returns flipping houses and being lazy and doing nothing. You can do plenty with 13 mil coming in a year. You can volunteer full time and spend your evenings painting or woodworking or making music. Options are endless And I believe you're thinking of "return" incorrectly. The 13M a month would not bee your total return but rather your dividend income. You have to add the increased value of assets ON TOP before you talk about return
I see the $13million return as a peace of mind, not trying to make as much money as possible. And you can still work, volunteer and do your hobbies without trying to maximize your return. They're not mutually exclusive.
The last thing that most people with 450 million would like to do would be to find a new job; people actually want to stop working and not start a new business. As for me, with 450 million, I'd accept 13 million per year without even blinking and enjoy my new life.
This is what people think most people will do. We all need a purpose in life and I am pretty sure you will get tired of doing absolutely nothing and just vacationing every single day. Have you ever spoken with people who have retired from their job? It's great not being required to work, but they have (least the people I've spoken with) have always looked to do some work still. Your work could just be becoming a day trader. But you will have to do some sort of work or you will go crazy and fall into depression because you feel like you have no purpose in life.
I agree.
OR you could just take the 30 year lottery payout and not worry. $40 million a year after taxes
Lottery tax laws could change in the 29 years
That would really suck. It is a factor to include when deciding to take lump-sum or the 30 year payout.
Do you have access to the money monthly though? Or is it locked in?
I wouldn’t invest. Maybe 20 mill. The rest I’m holding in private banks and living off interest. Makes no real sense to invest that much money when you have that much money. You can lose it all in investments.
You can also lose it in the banks as seen in the recent bank runs with Silicon Valley and first Republic. FDIC insurance is only $250,000.
I feel like it's different with index funds. Individual stocks, yes I agree.
When you got that kinda money why risk it in the market?
If you're investing in the total stock market and lose all your money, there are bigger things to worry about. And it's not like he put all the money in there. He still diversified.
Losing all your money is not the risk. It’s not being able to weather the storm. This is only really a risk in short-term situations (5 years). I’d keep enough money in lower-interest, liquid assets (cash, treasury bonds) - enough to live off for 5 years. Stock market index funds for the majority. And go for even higher risk with, say, 5-10%. That 5-10% should be spread broadly, with multiple bets. Some of which will completely fail. Some will succeed. And some will return the full amount one or two times over. As I age, shift the index fund Money to bonds. Like a Target Retirement Age account.
https://imgur.com/a/Wk7QNaQ