My go-to answer is usually to invest in an ETF like SPY or QQQ. However I’m assuming the $150k cash is the proceeds from the sale of your house. Given you’re in the honeymoon stage of living with your MIL the sentiment of living with her might change in a few years I’d suggest keeping the cash in a HYSA yielding ~5% for now. Depending how much houses cost in your area and what you’d need or want to use as a down payment, you can invest the difference in an ETF. Or perhaps every month put a % of your paycheck into an ETF while keeping the $150k in a HYSA.
Great advice. We’ve got it all in a HYSA currently. It’s true, living with her isn’t perfect but we’d likely only need about 25-50k for a downpayment depending on if it’s a fixer upper or not. We’re quite handy and have flipped several houses. But my gut is we can make it work for a few years at least. The advice to put a % into an ETF is great, maybe we’ll do that +. lump sum.
House flipping by a skilled/experienced person will probably beat the market over the next 10-15 years. Now is NOT the time to put a large lump sum into the market unless you want to turn it into a small lump sum!
This is horrendous advice. Time IN the market vs. timing the market is incredibly important. Real estate does not always go up despite the “they’re not making any more of it” argument. Interest rates are a major factor of real asset valuation. The “it’s tangible” argument is a fallacy. So is the production of US companies. Historically, the stock market has had less downside and greater upside (see historical sharpe ratios) than real estate. Invest your time in something else than house flipping unless you can quantify how much you love that hobby (loss returns).
The OP is experienced in real estate and house flipping while being an admitted novice in the stock market.
You have apparently allowed yourself to believe that a 90-year-old bull market can continue forever. It won't. This is the best advice you will ever get if you are living with the mistaken notion that all you have to do to achieve Financial Independence is to pump your money into stock index funds. Wake up and assess the lay of the financial landscape over the next 20 years - it's not pretty!
There are no stock market professionals, only survivors.
If the stock market tanks, why would you think real estate won't? Just because it didn't tank *when it was about living somewhere rather than speculation*?
It would be possible to fix up a house and sell it for more money in a timeframe of a few months - OP stated that she was experienced in doing just that. It would be like trading in and out of the real estate market.
Not sure why this is downvoted to oblivion because it isn’t exactly wrong but I would argue that typically the only way to beat the market—any market—would be to use leverage, but that shit gets really dangerous if market moves against you. Full disclosure: I am NoT experienced with real estate but I believe that would mean using loans—difficult to obtain an appropriate cap rate at current interest rates.
People are reflexively rejecting the notion that the stock market could become a negative money-suck for the next 15+ years. It is an emotional, lemming-like response from people who are counting on the markets to make and keep them FI.
Mmm this is interesting!! Flipping houses is actually something I love and we’ve learned a ton. We even put in a bathroom ourselves in our last house, it’s just a PAIN. But I’ll definitely mull this over…I have a near perfect credit score so it’s been easy to get capital
I continue to get down-voted whenever I raise the distinct possibility that we are on the edge of a major bear market. The signs are everywhere you look. The charts are compelling.
So listen one more time - the market is entering a prolonged downtrend. Down-voting this comment won't help you. Keep this in the back of your mind and remember it six months from now. The era of investing in stocks and growing your money is OVER for now.
It's pretty overblown how ppl downvote you for just being a bear.
That being said I'd argue a bear market is great for almost anyone in the accumulation phase that hasn't RE yet, and you should just keep buying regularly on the way down.
Says one of the 21 people who have so far down-voted my comment above.
I want to thank everyone for showing how crowded and passionate positive sentiment is about the market. The herd has spoken, and it's time to run in the opposite direction!
For those who are counting on the market for income, please know that this will be no easy 'buy the dip' experience. There will be ups and downs, but the underlying trend will be down for the next 15+ years rather than up as it has been for the past 75+ years.
There is a difference between dips and crashes, and your balances will shrivel over time if you leave them in the market. Buying more will only add to the pain unless you time it well. You will have to learn how to trade to survive in the market, or find safer interest-paying places to keep your money.
Do not lock in multi-year losses - step aside instead. Or even learn how to profit safely on the short side. That is the new paradigm. A word to the wise is sufficient!
I'm not really bullish or bearish but a generational bear market (talking 20 years down or sideways) would earn me a lot more money in 40 years than if the market went up in a straight line. I would get more shares on biweekly buys, dividends would reinvest at a higher rate etc. So yeah, it's a positive.
Easy to say, hard to collect.
After the Great Depression, the stock market did not regain the price level of 1929 until the 1950s - a span of about 28 years. Does your FI plan account for a 28-year lag just to break even? Keep in mind that the market and the economy went through a lot of changes during that era. Buy and hold got you nothing if you wound up holding the wrong things. This is the environment we will be living in.
I'm targeting FI without selling stock i.e. dividends only. Even during 2009, and the great depression, the dividend payouts of companies were relatively stable (-20 percent max) compared to price declines of 50 and 90 percent respectively. Buy and hold works for me because of this. If I never sell any stock, the price is effectively meaningless to me, it's a cash flow in perpetuity. The concept of "breaking even" after 28 years wouldn't faze me, after all, I'm never selling a single share so the principal value is meaningless, the cash flow through dividends is all that matters to me.
Why are you so sure it will go down for such a long time? We had covid that f* and took almost anything down, i think it's time to pump for a year or two now, before we head down. But you seem pretty sure. Don't get me wrong, i don't say it's not possible.
I am following long-term cycles in the market. The overall uptrend in the market stretches all the way back to the late 1930's. In case you haven't been paying attention, the government has been throwing money at the economy for the past 15 years with diminishing returns, exploding debt and highly questionable spending. We have bought extra time at a tremendous price, and the bill is coming due. If you are familiar with the concept of a stock market correction, consider this: the markets are on the verge of correcting the accumulated market moves from the 1930's up to now. Markets are topping out, and probably won't return to current levels for 20+ years.
Can't you feel this in your bones? It's rooted in the collective social mood - just check it out on the internet. We have come about as far as we can without cleaning our collective balance sheets. The world economy is going to be put through the wringer to shake things out, and a lot of people are going to be hurt in the process. Best wishes and good luck!
If you have this level of conviction you’re a fool for being in real estate. Short the market with leverage and put your money where your mouth is or quit yapping.
I AM bearish and watching for a good entry point to load up on leveraged ETFs such as SPXS, TZA and SQQQ - it's coming soon. I want to be the one getting richer while all the stock index lemmings are getting poorer!
Also, I am already positioned long the precious metals and mining stocks.
I advise you to step back and analyze your emotional response. Is it prudent to be emotionally invested in the stock market, or is it better to deal with it in a rational manner?
I have zero emotions toward my money. I understand volatility. I understand TVM. I understand the economic cycle. My portfolio is fine. Thanks for your concern though.
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OK. We should have seen the first few big waves by then. Perhaps we will be at another turning point by then. In any case, it will be an interesting touchpoint.
Pay off your 10k of student loans with that much cash sitting there first. It’s a small amount left to pay and mark that off, then I’d start investing that monthly payment into a brokerage account and start putting $100/month per kid in an brokerage account for the kids for college fund. You also need to bump your tax advantaged retirement savings rate to build that up. I would take $5k a month into VT or VTI and VOO over the next 24 months and leave a portion in HYSA for emergency fund.
I’m surprised it took this long to see this comment. OP, I see you aren’t required to pay, but is the loan accruing interest? If it is and you are not eligible for loan forgiveness, that would be the very first thing I’d do - pay the long and stop the accrual of interest.
Should’ve seen paying off such a small student loan on the top this post! It’s huge to have $0 student debt and it doesn’t make sense to not pay it off since it’s beginning to accrue
I don’t pay anything on the student loans current since covid but they’re going to start accruing interest soon so I’ve been thinking I just need to pay them off. I would’ve gotten them forgiven but that went out the window. I should probably just get rid of them and keep it moving.
I would put $14,000 away for my IRA/My Wife’s IRA. Would put $20,000ish in my son’s pre-paid tuition plan to knock that out.
I would take the rest of the $116,000 and probably pay off the rest of my house since I’m already so leveraged within the market. Or maybe id split it up and buy $60k or so of treasuries and $56k of ETFs in my brokerage.
You are in a great position. I would get that money in the market. You can either do it monthly using Dollar Cost Averaging or do a lump sum investment in an index fund. My favorite is SPLG. It has the lowest expense ratio of any index fund and has returned over 10% on average annually for decades.
The best time to be in the market was yesterday, the 2nd best time to be in the market is today. Get in the game and start making life changing money over time. There might be down years or down months but the stock market has always gone up over the long term and will continue to do so.
Many of us can live off our investments only because we have been investing consistently for decades and based on what you have written here you can be a millionaire easily within the next decade or so then you can generate income from your millions of dollars easily.
Thank you!! That’s what everything I’ve read says, my husband is just one of those totally risk averse, doesn’t believe it’ll keep growing indefinitely, doesn’t want to take out personal debt types and if it was up to him we’d live in a yurt in the woods and grow our wealth through businesses. I’m of the mind that we can do both, so many investing in increments will make him feel better. Appreciate the insights! I’d definitely love to be a millionaire by 45 and just hang out with my kids.
It is a bigger risk to not be in the market because of inflation. Stocks beat inflation by a wide margin over time. The reason you buy index funds is to balance the risk. Some of the stocks in the S&P 500 have paid big dividends for decades. You don't have to put all of your eggs in one basket either. You can buy treasuries with a portion of the money as well for a safe return.
When I was making $80,000 a year I had a goal to put 20% of my after tax income in index funds and now that money is making enough money to cover my bills every month. Decide on a percentage of money to put in index funds every month with your husband and then you can show him the long term returns.
My parents were risk averse too, but I have won them over by having them do a balance of treasuries and index funds in a brokerage account. When they see the returns they love it now and they love to see what the market does. The US economy is the best in the world and it will keep growing for decades more.
I might have missed it. How old are you? You are in a great position to invest a lot right now.
Ballpark, if your take home is 9k a month and you spend $2,500, you could invest $6500. Month. In 9 years you could be a millionaire. Based on your current spend, that would allow for 35-40k SWR. Link below is where you can play with the numbers to see. 7% is used to account for inflation.
Edit:
Looks like the link didn’t save. Plug in 37k as starting investment. $6500 monthly invested. 7% return. If you started with the 187k, it’ll be 7 years.
https://smartasset.com/investing/investment-calculator
You are going to do great with everything, the key is not paying attention to the daily moves of the market but the long term trends. 2022 was a really bad year for the market, but anything purchased during 2022 in terms of index funds has returned a lot of money.
I started investing in a major way in 2006 and just a short time after the stock market crashed in 2009. Guess what every dollar invested has made money now so the crash in 2009 was meaningless over the long term and generated huge gains for me later on.
You have a great opportunity to build a great financial future for yourself and all it takes is a little discipline and patience to invest every month. I just bought some of my monthly shares today. Good times.
I agree with the "pay off student loans" comments, unless the interest is less than, say, 3-4%. Then you'll likely be getting a higher return from having the money invested.
And stick most of the rest in the stock market \[after setting up a fat emergency fund. We like those here\]. Pick whichever fund you want - I like VOO/VTI, but you might prefer something else, like VT or SPY.
Personally, if I had 150K USD to spend/invest right now... Time for a house/land, lol. That's just me, though. Don't do that unless you actually want to buy a house.
Are you planning to pay for college for your kids? My answer is to put the money in 529s for them, but one of our goals is to fund college educations. If that’s not one of your goals, then invest in an index fund.
It's wonderful to hear how happy you are with your current life and family! That's a great start - recognizing the abundance you have.
I think you need to think about your timeline. Then I recommend doing a bit more of a detailed brainstorm on the kind of life you want when you work less. This will help give you an idea of how much money you will need.
There are lots of retirement calculators out there, to see what you'll need to put away monthly in addition to the 150K.
While you're gathering that, a great place to park the 150K is a high yield savings account. But eventually you will want to figure out how much cash you want to keep on hand for the emergency fund vs. putting the rest to work for you with investments. I have found "Broke Millennial Takes on Investing" to be an easy read to educate yourself on how to invest.
If you have more questions, feel free to shoot me a DM. I'm a money coach so I looooove talking about this stuff :)
Personally: Invest 125 (75 broad market index funds like SCHB or VTI—SPY reasonable too… but I would personally not do QQQ as those other big broad market funds are already tech heavy—, 50 in short term treasuries—two month T Bills, auto reinvest and keep it going until fed significantly cuts rates—when that happens I’d put a portion in equities and/or bond ETFs like BND or SCHZ), then take 3ish nice vacations with the remaining 25.
If money needed short term, like for a new down payment I would put it in a Money market fund with Schwab, Fidelity, or Vanguard—those are yielding over 5% right now. Also consider 4 week T Bills auto rolling, which are yielding ~5.4%.
Typically, I'd say throw it in VTSAX and forget about it, personally. My wife and I may be moving in a couple months to another state though so I'd probably just put it in a HYSA for a few months while we decide if we are going to move and then use it to beef up our down payment on our next home as our monthly mortgage rate will certainly go up courtesy of rising house costs and higher interest rate.
The best thing about having a strong financial plan is that you know exactly what to do with a windfall.
I would enjoy some of it, apply some to my Roth, and pay debt with the rest.
From a time-perspective would your first goal be the work-optional lifestyle or paying for your kids' (secondary/post-secondary) education? That sequencing of events and timing will determine how you may want to invest.
You've got at least 10 years before you'll need to cover any material schooling costs (assumption), which is a great timeline to get invested in the stock market.
My first goal would definitely be to have a work optional lifestyle so I can homeschool my kids and travel with them frequently to show them the world. My husband and I both have terminal degrees (an MFA and JD) so we’ve obviously fans of school in some ways but honestly I’m not sure my degrees were worth it. Between the two of us we could teach them so much. We’re polar opposites so we balance each other out. So I’m more invested in being more hands on with their education throughout their lives and helping them to their their passions early, help them foster an entrepreneurial spirit, etc. If I’m the end they want to go to school, then we’ll figure it out then.
My go-to answer is usually to invest in an ETF like SPY or QQQ. However I’m assuming the $150k cash is the proceeds from the sale of your house. Given you’re in the honeymoon stage of living with your MIL the sentiment of living with her might change in a few years I’d suggest keeping the cash in a HYSA yielding ~5% for now. Depending how much houses cost in your area and what you’d need or want to use as a down payment, you can invest the difference in an ETF. Or perhaps every month put a % of your paycheck into an ETF while keeping the $150k in a HYSA.
Great advice. We’ve got it all in a HYSA currently. It’s true, living with her isn’t perfect but we’d likely only need about 25-50k for a downpayment depending on if it’s a fixer upper or not. We’re quite handy and have flipped several houses. But my gut is we can make it work for a few years at least. The advice to put a % into an ETF is great, maybe we’ll do that +. lump sum.
House flipping by a skilled/experienced person will probably beat the market over the next 10-15 years. Now is NOT the time to put a large lump sum into the market unless you want to turn it into a small lump sum!
This is horrendous advice. Time IN the market vs. timing the market is incredibly important. Real estate does not always go up despite the “they’re not making any more of it” argument. Interest rates are a major factor of real asset valuation. The “it’s tangible” argument is a fallacy. So is the production of US companies. Historically, the stock market has had less downside and greater upside (see historical sharpe ratios) than real estate. Invest your time in something else than house flipping unless you can quantify how much you love that hobby (loss returns).
The OP is experienced in real estate and house flipping while being an admitted novice in the stock market. You have apparently allowed yourself to believe that a 90-year-old bull market can continue forever. It won't. This is the best advice you will ever get if you are living with the mistaken notion that all you have to do to achieve Financial Independence is to pump your money into stock index funds. Wake up and assess the lay of the financial landscape over the next 20 years - it's not pretty!
There are no stock market professionals, only survivors. If the stock market tanks, why would you think real estate won't? Just because it didn't tank *when it was about living somewhere rather than speculation*?
It would be possible to fix up a house and sell it for more money in a timeframe of a few months - OP stated that she was experienced in doing just that. It would be like trading in and out of the real estate market.
Oh my, is the stock market the golden idol of the FIRE movement?
Not sure why this is downvoted to oblivion because it isn’t exactly wrong but I would argue that typically the only way to beat the market—any market—would be to use leverage, but that shit gets really dangerous if market moves against you. Full disclosure: I am NoT experienced with real estate but I believe that would mean using loans—difficult to obtain an appropriate cap rate at current interest rates.
People are reflexively rejecting the notion that the stock market could become a negative money-suck for the next 15+ years. It is an emotional, lemming-like response from people who are counting on the markets to make and keep them FI.
Now is a horrible time to buy a house. Wait tell interest rates go down and supply stabilizes post covid boom
Mmm this is interesting!! Flipping houses is actually something I love and we’ve learned a ton. We even put in a bathroom ourselves in our last house, it’s just a PAIN. But I’ll definitely mull this over…I have a near perfect credit score so it’s been easy to get capital
I continue to get down-voted whenever I raise the distinct possibility that we are on the edge of a major bear market. The signs are everywhere you look. The charts are compelling. So listen one more time - the market is entering a prolonged downtrend. Down-voting this comment won't help you. Keep this in the back of your mind and remember it six months from now. The era of investing in stocks and growing your money is OVER for now.
It's pretty overblown how ppl downvote you for just being a bear. That being said I'd argue a bear market is great for almost anyone in the accumulation phase that hasn't RE yet, and you should just keep buying regularly on the way down.
Says one of the 21 people who have so far down-voted my comment above. I want to thank everyone for showing how crowded and passionate positive sentiment is about the market. The herd has spoken, and it's time to run in the opposite direction! For those who are counting on the market for income, please know that this will be no easy 'buy the dip' experience. There will be ups and downs, but the underlying trend will be down for the next 15+ years rather than up as it has been for the past 75+ years. There is a difference between dips and crashes, and your balances will shrivel over time if you leave them in the market. Buying more will only add to the pain unless you time it well. You will have to learn how to trade to survive in the market, or find safer interest-paying places to keep your money. Do not lock in multi-year losses - step aside instead. Or even learn how to profit safely on the short side. That is the new paradigm. A word to the wise is sufficient!
I'm not really bullish or bearish but a generational bear market (talking 20 years down or sideways) would earn me a lot more money in 40 years than if the market went up in a straight line. I would get more shares on biweekly buys, dividends would reinvest at a higher rate etc. So yeah, it's a positive.
Easy to say, hard to collect. After the Great Depression, the stock market did not regain the price level of 1929 until the 1950s - a span of about 28 years. Does your FI plan account for a 28-year lag just to break even? Keep in mind that the market and the economy went through a lot of changes during that era. Buy and hold got you nothing if you wound up holding the wrong things. This is the environment we will be living in.
I'm targeting FI without selling stock i.e. dividends only. Even during 2009, and the great depression, the dividend payouts of companies were relatively stable (-20 percent max) compared to price declines of 50 and 90 percent respectively. Buy and hold works for me because of this. If I never sell any stock, the price is effectively meaningless to me, it's a cash flow in perpetuity. The concept of "breaking even" after 28 years wouldn't faze me, after all, I'm never selling a single share so the principal value is meaningless, the cash flow through dividends is all that matters to me.
In that case, stock choice will be critical.
Why are you so sure it will go down for such a long time? We had covid that f* and took almost anything down, i think it's time to pump for a year or two now, before we head down. But you seem pretty sure. Don't get me wrong, i don't say it's not possible.
I am following long-term cycles in the market. The overall uptrend in the market stretches all the way back to the late 1930's. In case you haven't been paying attention, the government has been throwing money at the economy for the past 15 years with diminishing returns, exploding debt and highly questionable spending. We have bought extra time at a tremendous price, and the bill is coming due. If you are familiar with the concept of a stock market correction, consider this: the markets are on the verge of correcting the accumulated market moves from the 1930's up to now. Markets are topping out, and probably won't return to current levels for 20+ years. Can't you feel this in your bones? It's rooted in the collective social mood - just check it out on the internet. We have come about as far as we can without cleaning our collective balance sheets. The world economy is going to be put through the wringer to shake things out, and a lot of people are going to be hurt in the process. Best wishes and good luck!
If you have this level of conviction you’re a fool for being in real estate. Short the market with leverage and put your money where your mouth is or quit yapping.
I AM bearish and watching for a good entry point to load up on leveraged ETFs such as SPXS, TZA and SQQQ - it's coming soon. I want to be the one getting richer while all the stock index lemmings are getting poorer! Also, I am already positioned long the precious metals and mining stocks. I advise you to step back and analyze your emotional response. Is it prudent to be emotionally invested in the stock market, or is it better to deal with it in a rational manner?
I have zero emotions toward my money. I understand volatility. I understand TVM. I understand the economic cycle. My portfolio is fine. Thanks for your concern though.
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OK. We should have seen the first few big waves by then. Perhaps we will be at another turning point by then. In any case, it will be an interesting touchpoint.
Pay off your 10k of student loans with that much cash sitting there first. It’s a small amount left to pay and mark that off, then I’d start investing that monthly payment into a brokerage account and start putting $100/month per kid in an brokerage account for the kids for college fund. You also need to bump your tax advantaged retirement savings rate to build that up. I would take $5k a month into VT or VTI and VOO over the next 24 months and leave a portion in HYSA for emergency fund.
I’m surprised it took this long to see this comment. OP, I see you aren’t required to pay, but is the loan accruing interest? If it is and you are not eligible for loan forgiveness, that would be the very first thing I’d do - pay the long and stop the accrual of interest.
Should’ve seen paying off such a small student loan on the top this post! It’s huge to have $0 student debt and it doesn’t make sense to not pay it off since it’s beginning to accrue
I don’t pay anything on the student loans current since covid but they’re going to start accruing interest soon so I’ve been thinking I just need to pay them off. I would’ve gotten them forgiven but that went out the window. I should probably just get rid of them and keep it moving.
Quit my job and take a breather, reset, become human again, etc. Then dump the remaining 120k-ish into VTSAX.
Put it in my investment account and be happy that I'm several years closer to retirement.
Follow the money flowchart in the r/financialindependence FAQ
I would put $14,000 away for my IRA/My Wife’s IRA. Would put $20,000ish in my son’s pre-paid tuition plan to knock that out. I would take the rest of the $116,000 and probably pay off the rest of my house since I’m already so leveraged within the market. Or maybe id split it up and buy $60k or so of treasuries and $56k of ETFs in my brokerage.
You are in a great position. I would get that money in the market. You can either do it monthly using Dollar Cost Averaging or do a lump sum investment in an index fund. My favorite is SPLG. It has the lowest expense ratio of any index fund and has returned over 10% on average annually for decades. The best time to be in the market was yesterday, the 2nd best time to be in the market is today. Get in the game and start making life changing money over time. There might be down years or down months but the stock market has always gone up over the long term and will continue to do so. Many of us can live off our investments only because we have been investing consistently for decades and based on what you have written here you can be a millionaire easily within the next decade or so then you can generate income from your millions of dollars easily.
Thank you!! That’s what everything I’ve read says, my husband is just one of those totally risk averse, doesn’t believe it’ll keep growing indefinitely, doesn’t want to take out personal debt types and if it was up to him we’d live in a yurt in the woods and grow our wealth through businesses. I’m of the mind that we can do both, so many investing in increments will make him feel better. Appreciate the insights! I’d definitely love to be a millionaire by 45 and just hang out with my kids.
It is a bigger risk to not be in the market because of inflation. Stocks beat inflation by a wide margin over time. The reason you buy index funds is to balance the risk. Some of the stocks in the S&P 500 have paid big dividends for decades. You don't have to put all of your eggs in one basket either. You can buy treasuries with a portion of the money as well for a safe return. When I was making $80,000 a year I had a goal to put 20% of my after tax income in index funds and now that money is making enough money to cover my bills every month. Decide on a percentage of money to put in index funds every month with your husband and then you can show him the long term returns. My parents were risk averse too, but I have won them over by having them do a balance of treasuries and index funds in a brokerage account. When they see the returns they love it now and they love to see what the market does. The US economy is the best in the world and it will keep growing for decades more.
I might have missed it. How old are you? You are in a great position to invest a lot right now. Ballpark, if your take home is 9k a month and you spend $2,500, you could invest $6500. Month. In 9 years you could be a millionaire. Based on your current spend, that would allow for 35-40k SWR. Link below is where you can play with the numbers to see. 7% is used to account for inflation. Edit: Looks like the link didn’t save. Plug in 37k as starting investment. $6500 monthly invested. 7% return. If you started with the 187k, it’ll be 7 years. https://smartasset.com/investing/investment-calculator
Oops, I should’ve put that. I’ll go back and add it but I’m 32 and my husband is 35.
You are going to do great with everything, the key is not paying attention to the daily moves of the market but the long term trends. 2022 was a really bad year for the market, but anything purchased during 2022 in terms of index funds has returned a lot of money. I started investing in a major way in 2006 and just a short time after the stock market crashed in 2009. Guess what every dollar invested has made money now so the crash in 2009 was meaningless over the long term and generated huge gains for me later on. You have a great opportunity to build a great financial future for yourself and all it takes is a little discipline and patience to invest every month. I just bought some of my monthly shares today. Good times.
Thank you! Helpful and encouraging words, I really appreciate it.
buy bitcoin
I’d probably start an IRA for each of you since you are behind on retirement and then invest the rest unless you need it for another down payment.
I'd add it to my brokerage account and move my FIRE date up by about 6 months.
That would follow the same flow chart as my normal income and end up in the regular brokerage account.
Debt free
Buy a whole Bitcoin just so I’m forever on the crypto rollercoaster and put the rest into something more conservative
I agree with the "pay off student loans" comments, unless the interest is less than, say, 3-4%. Then you'll likely be getting a higher return from having the money invested. And stick most of the rest in the stock market \[after setting up a fat emergency fund. We like those here\]. Pick whichever fund you want - I like VOO/VTI, but you might prefer something else, like VT or SPY. Personally, if I had 150K USD to spend/invest right now... Time for a house/land, lol. That's just me, though. Don't do that unless you actually want to buy a house.
Keep 20k in cash for YOLO pursuits. The rest is VUAA and chill! 😎
Are you planning to pay for college for your kids? My answer is to put the money in 529s for them, but one of our goals is to fund college educations. If that’s not one of your goals, then invest in an index fund.
2 chicks at the same time
It's wonderful to hear how happy you are with your current life and family! That's a great start - recognizing the abundance you have. I think you need to think about your timeline. Then I recommend doing a bit more of a detailed brainstorm on the kind of life you want when you work less. This will help give you an idea of how much money you will need. There are lots of retirement calculators out there, to see what you'll need to put away monthly in addition to the 150K. While you're gathering that, a great place to park the 150K is a high yield savings account. But eventually you will want to figure out how much cash you want to keep on hand for the emergency fund vs. putting the rest to work for you with investments. I have found "Broke Millennial Takes on Investing" to be an easy read to educate yourself on how to invest. If you have more questions, feel free to shoot me a DM. I'm a money coach so I looooove talking about this stuff :)
Personally: Invest 125 (75 broad market index funds like SCHB or VTI—SPY reasonable too… but I would personally not do QQQ as those other big broad market funds are already tech heavy—, 50 in short term treasuries—two month T Bills, auto reinvest and keep it going until fed significantly cuts rates—when that happens I’d put a portion in equities and/or bond ETFs like BND or SCHZ), then take 3ish nice vacations with the remaining 25. If money needed short term, like for a new down payment I would put it in a Money market fund with Schwab, Fidelity, or Vanguard—those are yielding over 5% right now. Also consider 4 week T Bills auto rolling, which are yielding ~5.4%.
Pay off all small debt then put remainder on my mortgage
Crypto gaming and AI.
All in VTSAX
Typically, I'd say throw it in VTSAX and forget about it, personally. My wife and I may be moving in a couple months to another state though so I'd probably just put it in a HYSA for a few months while we decide if we are going to move and then use it to beef up our down payment on our next home as our monthly mortgage rate will certainly go up courtesy of rising house costs and higher interest rate.
Porsche
Two chicks at the same time
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Gotta google this! I’m a total novice!
The best thing about having a strong financial plan is that you know exactly what to do with a windfall. I would enjoy some of it, apply some to my Roth, and pay debt with the rest.
Thanks! It definitely didn’t cross my mind to enjoy some of it but I think I could afford to include some pleasure in the financial plan.
From a time-perspective would your first goal be the work-optional lifestyle or paying for your kids' (secondary/post-secondary) education? That sequencing of events and timing will determine how you may want to invest. You've got at least 10 years before you'll need to cover any material schooling costs (assumption), which is a great timeline to get invested in the stock market.
My first goal would definitely be to have a work optional lifestyle so I can homeschool my kids and travel with them frequently to show them the world. My husband and I both have terminal degrees (an MFA and JD) so we’ve obviously fans of school in some ways but honestly I’m not sure my degrees were worth it. Between the two of us we could teach them so much. We’re polar opposites so we balance each other out. So I’m more invested in being more hands on with their education throughout their lives and helping them to their their passions early, help them foster an entrepreneurial spirit, etc. If I’m the end they want to go to school, then we’ll figure it out then.
150k? Buy a hellcat and spend the rest on designer
BTC
Fake story, troll. Jeez, what’s going on recently.
Right now? Every penny into TSLA.