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Bloody Queef posted:All the financial advice in this thread is spot on. Umbrella policies also are a must have when your net worth exceeds your insurance coverage. They are also reasonably priced, most places doesn't cost much if you already have other insurance policies active such as car or home. The long term investing thread has good advice as well, max out your retirement savings, have at least 6 months of expenses saved as cash and always go with low cost index funds. Aliquid posted:Quickly enough, they're not certificates of deposit. Stocks are illiquid in the sense that you don't want to cash them out if the market is slumping. Nope liquidity refers to how easy it is to cash out a investment, stocks are really liquid investment. etalian fucked around with this message at 21:36 on Sep 6, 2015 |
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Sep 6, 2015 21:33
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with backpacking. I'd suggest south america, check the travel forum.
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I would suggest you figure out how to put it away correctly and not think about it for a long time. I don't want to suggest you're me but when I first got a professional job I didn't really know how to manage all the money I was making - it took awhile to develop the discipline to do that. I would not want to magnify those mistakes on that level of 850k. I don't think necessarily you should have to wait until retirement to put this money until some kind of use - maybe one day you could buy into a business or franchise - but I would learn to live with what you have and put let it grow interest for a long time. In twenty years you'll be able to invest in a business and maintain solid retirement nest egg for the future - but by that point you'll also have a lot more experience and probably a much more mature sense on how to manage your money. I think it's very easy to find things you think you need - which probably aren't wrong in one sense but might not serve you the best - I think getting a good vehicle and a backpacking vacation are a good idea - but I would draw a very sharp line under that. Maybe you need a new computer - I would personally suggest you have a reliable laptop for work purposes - but I would really do your best to think twice about what you think you need vs what you really need. When I graduated college - my college computer was four years old and overheated and generally was due for a replacement - but two years later I thought I 'needed' a MacBook when that second replacement computer was still perfectly adequate. I think it's going to be a lot harder to make these distinctions with 850k in the pocket - it got a lot harder for me with a 55k job. I think you really want to do your best to firewall off that money and be extremely methodical about it. WI think a lot of people say things like 'save for retirement' but they don't do such a good job of painting a picture of day to day financial management and how it affects you in the long run. On the other hand - you should enjoy the money you have - I think putting it in a pile forever is dumb, but you have to be really careful on what 'enjoy' means - it could set you up for a great life one day or it could slip through your fingers in an instant. but that's just me - it's about money discipline. Maybe you have that, maybe you don't, I think I did not have a lot of examples of that so it was hard for me but maybe it will be less so for you.
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Sep 6, 2015 21:40
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As someone who has been in much the same circumstances as you are, the advice in this thread is mostly spot on. I inherited a bit more than you did, when my mother passed away in a car accident about 15 years ago. I was 18 at the time. The difference is that for a while maybe half of the money was tied into a running business. Thankfully I didn't piss away the money. For a long time I had a private banking arrangement with one of the big banks here (i'm not in the U.S.). It costs about 0,4 - 1 % of your capital and normal investment expenses and they will take care of the money (with variable success). If I had known then about index funds and understood investing I would have done some things differently. The private bank I used was one of the oldest and most conservative, so they didn't really have stellar years, but they usually didn't have crashes either. I would have had more returns on my money investing it more directly, but on the other hand, being 18-25 I might have done something monumentally stupid with the money, so the banking relationship helped me come to terms with having this money and using it for my benefit. For the most part I have made sensible arrangements. I own my apartment now that I know the city I'm 90% sure I will live in for a long time. I also own a few rented apartments, which pay their own loans, so I'm not actually using cashflow. Most of my invested money is in index funds, with a few special instrument funds, for example one that invests only in forests, which are a very safe bet in my country. In addition to direct investments in index funds, I still have a relationship with two investment firms, one which invests in index funds and passive instruments and one which does a lot of novel investments strategies. I have some advantages since my dad is very active with investments, although he is more the guy that goes to the banks and investment firms and listens to the stories, while I have become increasingly critical towards most of that. He is quite conservative as an investor, which is fine, since he is 69 now. The advice in this thread is spot on the following: don't let the money change who you are and what you want to do with your life. The money if managed sensibly will help you along the way and keep you debt free, which means that your actual income will go much farther than for many of your co-workers and friends. If you have any questions, send me a pm.
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Sep 6, 2015 21:54
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Lprsti99 posted:EE was my original major. There's a big difference between one basic calculus class and four ever-more-advanced calculus classes. I honestly did try, but Calc and my brain weren't playing together so nice This is a tough decision. Using some of this money for the EE degree could be great, but only if you will succeed with it. EE coursework is truly challenging, it's not just your imagination - so, how much do you want it, and how well can you handle the stuff that stopped you last time? Have things really changed? It may be that EE is just not for you, and that's fine if so. Do it if it truly calls to you, but don't get sucked in by "I should..." kinds of feelings. Although, an extra $850k does give you the ability to make totally the wrong decision on that degree and still not be financially hosed for the rest of your life  I just hate to see you waste it on schooling that you won't actually leverage into a good life trajectory. Anyhow you have time to think about it.
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Sep 6, 2015 23:54
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Nothing wrong with being a tech. You don't really have to go all out to be an engineer just because of this money. You actually have a chance to 'follow your dreams' a little bit, don't just go do an engineering degree if you don't think you can hack it. You're work life may very well suck.
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Sep 7, 2015 15:00
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Nah, going back for full EE has always been at the back of my mind, as an option if I felt I'd benefit from it and could do better in the calc classes. Nothing specifically to do with the inheritance, other than that it would make doing so less of a risk.
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Sep 7, 2015 19:08
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I'll tutor you in high level calculus, duder. It would be fun to relearn diff eqs. I charge as a percentage of assets though 
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Sep 7, 2015 19:13
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You just got a ton of eggs without having many recipes to cook with. Don't put them all in one basket. You want to plan out everything you do from this point forward with an anticipated return, an anticipated risk, and in light of the proportion of assets. The most mundane option is putting it all in a savings account. Here's the shape of the analysis: if you put it all in one account, you will receive $8500 / year in interest. You run the risk that you will lose $600,000 if that bank becomes insolvent as FDIC only covers $250,000. Holding it in USD exposes you to the risk of that currency tanking, and the certainty of it being devalued by inflation. Holding it all in one savings account has more risk than putting 200,000 in four different accounts at 4 different institutions. Most of the other advice here is great too. Good luck!
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Sep 7, 2015 19:58
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Dwight Eisenhower posted:You just got a ton of eggs without having many recipes to cook with. Don't put them all in one basket. This is bad advice since in the current low interest environment this plan costs money each year due to inflation. Best option is to put most of it in boring stock/bonds ideally passive index investments and save a small portion in a savings account for short term expenses.
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Sep 7, 2015 21:02
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etalian posted:This is bad advice since in the current low interest environment this plan costs money each year due to inflation. r,c;p.
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Sep 7, 2015 21:09
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For new investors who don't like seeing big losses there are plenty of more moderate risk funds out there like Vanguard's Wellington or Lifestrategy moderate. If you haven't played with stocks before and developed discipline in down markets it makes more sense to go with a lower risk fund.
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Sep 7, 2015 21:16
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Why is everybody acting like $850,000 should be treated differently than $85,000 or $8,500? What is this franchise/business investment horseshit? God drat! Put that poo poo in Vanguard's Target Retirement Fund and get back to work. Quit when you're ready.
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Sep 7, 2015 23:08
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GoGoGadgetChris posted:Why is everybody acting like $850,000 should be treated differently than $85,000 or $8,500? What is this franchise/business investment horseshit? God drat! The advantage of a franchise is that you can work really long hours to earn less than minimum wage and pay lots to do it. I thought that walking into a local franchise and seeing how poo poo everything is would put people off. I have the advantage of seeing franchises that fail and are replaced by another business.
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Sep 7, 2015 23:18
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etalian posted:This is bad advice since in the current low interest environment this plan costs money each year due to inflation. What inflation? We're close to zero percent and even went negative earlier this year.
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Sep 8, 2015 02:11
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Shipon posted:What inflation? We're close to zero percent and even went negative earlier this year. If you are young and want to build long term wealth, putting 850k in savings account is not a good strategy.
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Sep 8, 2015 03:00
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Stuff it in a mattress, douse it in gasoline and set it on fire.
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Sep 8, 2015 03:09
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etalian posted:If you are young and want to build long term wealth, putting 850k in savings account is not a good strategy. Dwight Eisenhower was using it as an easy-to-understand example of risk vs. reward, not as a plan foward. edit - probably a quote said before Operation Market Garden
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Sep 8, 2015 05:25
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Just so you know, differential equations is literally the hardest it gets on the EE path, and the rest is just variations on basic calculus and algebra. All the important stuff has been reduced to charts and tables; if you can struggle through Calc II and III, you'll be able to make it as an electrical engineer. More on topic, invest the money according to your level of risk aversion. If it were me, I'd just park it in a moderate risk Vanguard fund.
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Sep 8, 2015 06:23
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Aliquid posted:Dwight Eisenhower was using it as an easy-to-understand example of risk vs. reward, not as a plan foward. This right here is a subtly great post. Also yes the savings account was just an example of the most boring, straightforward, easily modeled risk / reward / proportion analysis. It is a bad plan. Just the mechanics of FDIC insurance mean that there's a clearly dominant plan (4 savings accounts instead of 1). It's an analysis that also underscores the value of diversification; you shouldn't throw all your money into ANY of the plans you contemplate, be it a high yield dividend index fund, a savings account, a certified deposit, a bond portfolio, a basket of stocks, an exotic options trading strategy, a real estate investment, a fast food franchise, or uncle timmy's burgeoning beanie baby business. Ideally you dip a toe into all of the ones which have a realistic probability of not losing all your money eventually. But putting it all in a savings account and depositing from there into the other things you choose to invest in is not a bad place to start.
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Sep 8, 2015 14:46
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Invest in the pot business. Leasing extraction equipment to growers is a goldmine. I would use 25% doing this, Vanguard 50% and do whatever you want with the other 25%. (Bonds and savings) So 25% high risk, 50% boring, 25% more boring.
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Sep 8, 2015 16:51
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How does this change if you are 45 instead of 25? Already got the kids, spouse, house, career. Is it just a matter of finding an advisor and telling them youre ready to retire?
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Sep 8, 2015 17:08
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Fart.Bleed.Repeat. posted:How does this change if you are 45 instead of 25? Already got the kids, spouse, house, career. Is it just a matter of finding an advisor and telling them youre ready to retire? If you are 45 you should have already given enough serious thought to your retirement to have a good idea of how much money you will need in order to retire. So the 850k at that point would simply get you closer to your goal (or you might adjust your goal to include more spending in retirement or now for travel and other luxuries).
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Sep 8, 2015 17:24
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Two words: "Goon projects." (All the advice worth reading was provided to you on Page 1. It's all Goon Islands and franchises from here down.)
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Sep 8, 2015 17:40
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GoGoGadgetChris posted:Why is everybody acting like $850,000 should be treated differently than $85,000 or $8,500? What is this franchise/business investment horseshit? God drat!
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Sep 8, 2015 19:00
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Waador posted:> Step 2 - Finish school and get a job as if you were a normal person. Here's where things get interesting. Most people in their mid-twenties, after finishing school, have to loving kill themselves to succeed in the workplace. You've got options, and they're pretty good. $20K or $30K annually in dividend income isn't enough to not have to work, but it is enough to not have to work all year. When you're assessing your employment options and job offers, consider finding a firm that is explicitly okay with you taking unpaid leave, and then take advantage of it as you deem necessary. How that works is up to you. Maybe you work an 80% work week, and get Friday off every week. Maybe you work a 100% work week, but take two months off every year (one month vacation, one month unpaid leave). Or three months off every year. You can be a rock-star professional in your company by giving it your all when you're working, and achieve something resembling 'work-life balance' that other people only dream about (because it's largely a myth unless you're already wealthy). This is probably the best advice I've seen in the thread so far. Not needing to worry about money, and having an appropriate amount of vacation, will make you a superstar at your job regardless of how much smarter your co-workers are.
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Sep 8, 2015 19:48
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Shipon posted:What inflation? We're close to zero percent and even went negative earlier this year. The inflation where the Federal Reserve increases its balance sheet by $85Bn per month. You know, making money exist where none previously did. The lovely part is that it's been walled off from the rest of the economy for a while and when it does finally enter circulation it's likely to be in a giant tidal wave. But look on the bright side. When it does, interest rates will finally go up and saving money will actually be a good idea again.
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Sep 9, 2015 23:06
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OP, if I can struggle through Calc, I'm pretty sure you can too.
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Sep 10, 2015 21:00
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nurse1151 posted:Take about half of it.. buy MONTHLY dividend paying stocks, put a stop loss on the shares. Take another quarter and put it into QUARTERLY dividend paying stocks, take the rest and keep it for an emergency fund. Eskaton posted:OP, if I can struggle through Calc, I'm pretty sure you can too. Jeffrey of YOSPOS fucked around with this message at 21:53 on Sep 10, 2015 |
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Sep 10, 2015 21:45
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Invest in a bitcoin mining rig.
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Sep 11, 2015 04:24
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Wizzle posted:The inflation where the Federal Reserve increases its balance sheet by $85Bn per month. You know, making money exist where none previously did. The lovely part is that it's been walled off from the rest of the economy for a while and when it does finally enter circulation it's likely to be in a giant tidal wave. But look on the bright side. When it does, interest rates will finally go up and saving money will actually be a good idea again. From what I've read of the actual mechanism by which the banks access the QE funds and how the Fed plans to call those loans I don't think that's the way it will work out. Time will tell though. Jeffrey of YOSPOS posted:I'm pretty sure he'd have to actually, you know, understand and use it on a day-to-day basis. Maybe I'm way off base here since I'm not an EE by trade, but I definitely wouldn't want to work as a professional in a field while being uncomfortable with the math behind it. While calculus is a real needed thing in EE it's not like you're solving multi-variable partial differential equations all day. If serious math has to be done it's going to be the high-paid guys with Phd's who are going to be doing it. Everything else can be solved pretty much with matlab or SPICE or some other tool and you really just have to know enough to get the answer you need, understand the tool output and recognize when you screwed it up or understand what someone is telling you to do. There is lots of time to learn through repetition and simple building tasks once you are in the industry, if you can pass the classes with an decent GPA you'll do fine. Murgos fucked around with this message at 16:02 on Sep 11, 2015 |
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Sep 11, 2015 13:01
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Or move to somewhere with a very low cost of living and enjoy being king midas
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Sep 11, 2015 13:24
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Cast_No_Shadow posted:Or move to somewhere with a very low cost of living and enjoy being king midas I hear Cambodia is nice this time of year.
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Sep 11, 2015 21:38
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Murgos posted:From what I've read of the actual mechanism by which the banks access the QE funds and how the Fed plans to call those loans I don't think that's the way it will work out. Time will tell though. They're buying US treasuries with them and padding their coffers. Then they're taking that money, and rather than lend it out like they're supposed to do, they've been making stock market investments. Since it's all AAA-rated they can leverage those 3:1 at a minimum and pre-2007 some banks had special dispensation to leverage 20:1. (Not sure if those exceptions still exist) So there's your inflation. Securities and equities paid for by "fake" money.
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Sep 11, 2015 23:04
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r0ck0 posted:I hear Cambodia is nice this time of year. I've seen recommendations on Vietnam and Thailand in the past year as well. The return on $850k would allow a magnificent lifestyle, or endless drinking at the pub.
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Sep 11, 2015 23:34
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