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Ask HN: What to do after $8M (all cash, post tax) exit?
687 points by throwaway8m on Dec 5, 2018 | hide | past | favorite | 508 comments
Going anonymous for this. I am just an average project manager who happened to be at the right tech company at the right time. They had a big exit and suddenly my stocks are worth $8M (the money came in my account last week).

I am just an average guy. I am 43 and middle level tech manager.I know coding (but nothing superb). I know business (but nothing much). I am not particularly very hardworking or particularly super intelligent. Not dumb or lazy - just average.

The point is I can probably find another similar job but probably nothing much higher.

I have two kids and a nice wife. I have a nice, small house and two small cars. Everything paid for. I have no debts or “vices”. I do not like smoking, drinking or going out. I do not think I have any real hobbies.

Just a simple guy with simple life and then this happens. What should I do? Should I donate it? Should I hire a personal wealth manager? Should I retire?

I am freaking out. Please provide some guidance.




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) for one year. As it may take as long as five years for the windfall recipient to adjust to a new life, this pause provides a chance for emotions to cool, helps avoid impulsive behavior, and, if warranted, allows the recipient time to put together a team of professional advisers."


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 trustworthy family about this. Otherwise,you will quickly have lots of “friends” and family members who “love” you.

Going forward with work is a personal decision. Obviously, you don’t need to. A tried-and-true conservative investment approach will pay you sufficient income for the rest of your life (and our kids through college, and everything else). But it’s tough to stop working. Anecdotally, I’m about half retired (on a lot less money) and it’s a big challenge.

I’m getting long winded. For now, resist the urge to do anything special, anything too different.


"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.


It’s not really about owning anything. It’s thieving friends of family who will hold it against you if the wealth is not shared on account of your apparently deep social bond, if not trying to wrings it out of your wallet outright.


I think in practice though, if you act that you "earned it", it is much harder for people to assume they can ask you for it. You here a lot about lottery winners going broke, but you don't hear as much as startup employees on exit eventually going broke. This may be just a result of education and income levels, but I also believe that people don't mind asking you for money if it seems like it came to you through luck and not effort.


The justification isn't that OP came by the money unfairly, it's that because he has so much he doesn't need it as much as his friends and family need it. "Oh, can I get $20,000 for my business idea? Will you help send your niece to private school instead of state school? I'm paying 25% interest on this credit card debt, can you give me the money to pay it off?" etc etc. Everyone from his parents to that one guy he knew in college will want to solve their "small" money problems with OP's windfall, because to them he'll still be a millionaire and never have to work again. What eventually happens is OP will have to start saying NO to people then they will resent him and it will change the dynamic of their relationship. Or he could just keep his finances to himself and not bring this on himself. I'm not saying he shouldn't be able to help anyone who really needs it. It's just in his best interest to not advertise how much he really has to other people.


>> ...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 ;-)


I agree. A financial guru I've listened to off and on for many years is Clark Howard and he suggests always using a financial advisor that you pay outright with fiduciary responsibility. His favorite recommendation is to talk to someone from the Garrett Planning Network. If you aren't paying upfront you are paying far more in bad investment advice that isn't designed to make you money. Think bad investments that offer kickbacks to your "advisor."


For those who don't know, a fiduciary is legally obligated to work in your best financial interests, so it's pretty important that your financial advisor is one.


Reinforcing this, someone with constrained by fiduciary duty must make (and be able to show) recommendations/actions based on your best interests when it comes to your money or be liable.

An adviser that is not operating under the duty, can place their best interests above yours legally (and this is expected).


Anecdotal, but a friend of mine works directly under Clark Howard. By all accounts he is a wonderful and generous man, rare for one giving financial advice. I would generally trust him.


Yes, if they get a commission from what they sell you, they do not have fiduciary.


Apart from investment advice you'll also need legal advice to know how to comply with your fiscal obligations and structure things in the best possible way (including estate planning). So you need at least an accountant and a lawyer. The investment part is much less urgent.


Estate attorney, tax attorney, CPA, and possibly a financial advisor. Doesn't sound crazy for someone who just got $100 million from selling their business.


> Unsurprisingly lots of people have been in similar situations

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-...


That is across all ages and I would guess that few here are seniors. At 35 the top 1% is $2.3m. So many here may be more wealthy than you realize.

https://www.financialsamurai.com/the-top-one-percent-net-wor...


Judging by the already pre-selected crowd here, it's likely more than 1/100.


You should also be able to find plenty of discussion threads in the Bogleheads forum started by other people who have found themselves in this position over the years.


IIRC Reddit also has a bunch such threads, I want to say in /r/personalfinance

https://np.reddit.com/r/AskReddit/comments/24vo34/whats_the_... is a pretty famous series of comments.


seems like a great problem to have

a source of depression for some.


This is a great thread. Throwaway also. Gonna write some stream-of-consciousness here, because I have to start my work day, but I personally made approx. this amount from an exit, and it has gone very well for me and my family (wife + 3 kids). Some additional fine-tuned advice of what worked for me: (1) don't be afraid to spend money - high hourly rates - for a good accountant and good tax attorney. (2) if I were you I'd sign up for a couple different brokerage accounts (e.g., Charles Schwab and one other) and split the money between them. It takes almost no time to do this, and it's nice to have some diversity there in case something catastrophic happens to one of them and your assets are locked up for a long time while it gets sorted out. (3) as others have said, just buy US treasuries (interest rates are good right now) while you sit back and think about it. (4) Eventually if you're not into picking things yourself, you'll just want some healthy mix of asset classes, which (5) you'll learn about by reading some books. (6) Those brokerages will put someone on the phone with you and help you buy the treasuries, if that's confusing. (7) The one thing you want to avoid is letting the brokerages sell you their own personal wealth management. Everyone from your bank to your brokerage will try to sell you the "we'll help you for 1% of your money per year" -- avoid this. Suddenly 10 years have gone by and $800k-ish of your $8million is in someone else's hands, who simply threw darts at a dartboard and did their best to obfuscate their performance during bad times. (8) AVOID PRIVATE INVESTMENTS. Unless you're a professional private equity investor, don't buy a piece of that friend's restaurant, that store that's opening up, that tech startup, whatever. This money tends to disappear. If you're ok losing money to support your cousin who's starting a new company, just give them some money and be honest to yourself and them about the whole thing (not that I advise this either, but don't confuse charity and investment.) Just don't invest in private stuff. The problems with private investments: (a) you lose all liquidity, (b) markets aren't efficient so you can actually do a veeeeery bad job, (c) it can get personal and/or skeezy. So seriously, avoid any kind of private investments. (9) Avoid starting your own business and pouring all your money into it. People tend to burn through windfalls in that way and regret it. (10) Don't race into fancier real estate. (11) Make no lifestyle upgrades at all during the next year. (12) Take your time with charities. It can be a fun family project in the years to come to pick charities together. You'll have income in many years from this money, so you're not missing an opportunity for deductions by not giving money in the first year. (13) OH ! When signing up for brokerages, don't enable options or margin trading. In addition to this being dangerous for you, I believe it allows them to be funky with your cash and holdings, and it complicates your relationship with the brokerage should they or a bank they work with ever go under. (14) don't rush into estate configuration, just start with a simple will. Then consider trusts and things like that in future years. From my and my friends' experiences, they tend to overcomplicate things. (15) TELL AS FEW PEOPLE AS POSSIBLE. (16) Keep working, but only on something you enjoy. (17) Stay or get in shape. Your body is more important than money.

Seriously, AVOID PRIVATE INVESTMENTS.

Kobe Bryant on taking care of family after a windfall: "You will come to understand that you were taking care of them because it made YOU feel good, it made YOU happy to see them smiling and without a care in the world — and that was extremely selfish of you. While you were feeling satisfied with yourself, you were slowly eating away at their own dreams and ambitions. You were adding material things to their lives, but subtracting the most precious gifts of all: independence and growth."

https://www.theplayerstribune.com/en-us/articles/kobe-bryant...


Wow. Great quote from Kobe. It's true. Parents have the urge to remove all the obstacles from their children's lives that they themselves had to struggle with. However, struggling builds independence and personal growth. It's a fine balance.


Hi,

Some tips from me:

- Take a nice holiday - Don't rush into investing. Take some time to think about what you want to do. - If you invest in stocks, do it in a staged plan. Resist the urge to sell when it's going down, and the urge to buy when it's going up. (I could not resist buying when it went up beginning January this year). Start with small amounts first. Be there for the long run (don't sell/buy all the time). Be prepared that you can go up/down a lot in one day. - Rather invest in index funds then specific stocks - Don't invest everything in one type. Don't just use 1 broker. Stay away from leveraged, turbos, bitcoins, etc... - Be careful about tax impacts on your decisions, depending on where you live - Be careful about private investments. Only invest into something which you understand and have knowledge of and can help and make it possible. Only take market risk, and not the execution risk. (I for instance have not yet done any investments so far) - I put some of my money in hedge funds (Millenium, etc..) through a private bank (additional yearly fee + performance fee).

And: - Think about what you would like to do. For me that's starting a new company (since I already did that before and succeeded). If you like your job, then stay.


Honestly this is mostly bad advice. The guy should just sit on his hands for a year or two while he processes the idea of having money. Telling somebody who has never made a big financial decisions to start buying millions of dollars worth of financial assets is terrible advice. Unless by "start small" you mean invest a non-material amount, which still leaves the question: what to do with the remaining 99% of the money. My answer: nothing. Checking/savings account is fine.

When you have a large amount of money the most important thing is not to make any huge mistakes. The best way not to make a huge mistake is to just sit on your hands and do nothing. This is advice that anybody can follow, as opposed to your advice which is vague and absolutely not without risk (there is nothing conservative about buying index funds 10 years into a bull market).


No, checking/savings account is not fine. They are covered for $100,000 (IIRC) by FDIC if the bank fails. [Edit: $250K.] That is, if the bank goes under when you have $10 million in it, you get back... $259,000.

I mean, it can be OK if you have 40 different accounts in different banks. But that's tedious.

Dump $100K into a bank account (one that does not have a debit card attached to it). As others have said, set aside one year's expenses; I'm going to assume that $100K is in the neighborhood of that. Put the rest into, say, a Vanguard S&P 500 index fund, a Fidelity high-quality corporate bond fund, and somebody else's Treasury fund.


You should NOT have 8 million in a checking account.


Because FDIC only insures $250K? SIPC only covers $500K somewhere like Schwab[1] - or do you mean because you think it's terrible not be earning something on the $8M? Presumably that's enough for anyone to live out the rest of their life on comfortably...

1: https://www.schwabmoneywise.com/public/moneywise/essentials/...


I mostly meant for safety. You want it split up for many reasons... so you can have the FDIC or SIPC insurance, so you don't have to worry about losing access to the account via fraud, etc.

It would be ok for a short term to keep it in checking or savings accounts, but don't put it all in one.


FDIC is not just a dollar limit, but also per bank. Someone can have CDs from multiple banks, all in one account. Millions of FDIC insured money is easy these days.


when you have $8mm, sitting on your hands for a year costs you ~$250,000.


If you make rash decisions based on your perception of opportunity costs at that kind of sum, it's a good first step for losing it all. I'm also surprised by the attitude of 5% gain is easy and guaranteed. It's not. Neither treasurey funds nor real estate yield anywhere near 5% and we are many years in a bull market. Expecting 5% yearly ROI in the market over the next decade is optimistic.


> we are many years in a bull market

I agree. Having most of his capital in the stock market or real estate is a great opportunity to lose money in the next 5-10 years. Holding cash and investing it when the market is down is a good idea. Buffet currently does that because Berkshire thinks [1] that most of the stocks are overvalued (he waits for the next crash to buy them when they're cheap).

Other assets which are stable in value (e.g. gold, inelastic resources) are also a good idea.

[1]: https://www.businessinsider.de/warren-buffett-berkshire-hath...

OT: I would get myself a New Zealand citizenship/permanent residency and buy real estate there ($500k-1m NZD). Many millionaires are currently heading to Australia and NZ because they expect that the inequality will get to the point where society will turn aggressive. A little bit paranoid, but they try to be better safe than sorry. Plus New Zealand is a wonderful place to live and the real estate price will rise in the next years because of growing fear. [2]

[2]: https://www.bloomberg.com/features/2018-rich-new-zealand-doo...


$SPY has lots of room to go. This bull market is just starting to simmer until the market tells us otherwise. Further to that, for many, me excluded, time in the market is better than time in the market. If you can afford to just leave all your money in the market, overtime, statistically, it has been proven to get better returns when we recover. Suppose OP drops $8M into the market and it dips to $150, it will likely recover in time and it won't be spent if you just leave it. You can also do the 4% withdrawal that many financial blogs suggest.

Leaving cash on the side will eat you alive especially when inflation goes higher. However, if inflation goes up significantly over the next decade, think 15-20% inflation per year, having money on the side to buy assets will give OP the ability to become an asset owner, as inflation provides the ability for the largest transfer of wealth, assuming items can be paid off and investments are made in assets which gain value, i.e. houses, not cars.


Most people lack the emotional capability to hold stocks that are losing value.

If inflation goes up he can use his money to allocate the most valuable asset. I just don't think it's generally a good idea to invest while the market is deep into a bull market. It's better to put 1/5th or 1/4th into this bullish market and wait on the sidelines for the market correction (crash). If you buy after a crash, it's definitely a better bargain. Finding other options for your cash (e.g. houses that are expected to rise in value) to avoid losing 2% to inflation is certainly a good idea. I would also consider the risk that OP had no contact with the stock market before and that the emotional toll you get when you see that -15% in your portfolio can be overwhelming. Most people lose their money because they realize their losses in the wrong moment (and vice versa - some people lose their money because they don't cut their losses early enough). Definitely no hassle-free money in the stock market.


I think you meant time in the market is better than timing the market. However your advice rings true.


Yeah oops. For most, time in the market is better than timing the market.


not opportunity cost, real dollar loss to inflation. the opportunity cost is even greater.

also I don't know why you are talking to me about 5%. $250k is not 5% of $8mm.


Yea you're right. I dunno why I added the 5% part here, it's something I saw across other comments.


What would it have cost you if you dumped your windfall into an index fund in July 2018? Answer — you would have lost money and get the shaft when you’re forced to sell to lay taxes, etc.

Prudence and dollar cost averaging are your friends. People who stay rich are conservative with cash.


I disagree on not hiring an adviser. The key is to know what kind of adviser they are. If they are a fee-only adviser with fiduciary responsibility, it is likely exceptionally worthwhile. It sounds like you have a good handle on how to manage your finances, but there is a LOT to know. Minimizing taxes, planning children's' college, etc. Also, the good ones don't charge a flat 1% all the way up. They will charge less the more money you have with them. Source: my wife is a CFP and works for a well-respected firm in that industry.


Hear here! My personal friend does accounting and wealth management (mainly accounting) for high net worths. I generally disagree that people need wealth managers, but if given the description it might make sense. He doesn't usually do anything more complicated than helping you decide your asset mix and throws it in Vanguard indexes, and makes sure you don't spend it on private investments.


The problem is that the industry is littered with con artists and the downside damage an unethical person can do to your finances is horrific.

The best thing is to read, read, and read more before even looking for outside consultation on any of these matters.


> Seriously, AVOID PRIVATE INVESTMENTS.

Good advice. My understanding is that private investments are the #1 way professional athletes with even more money than OP go broke (excludig straight-up fraud by their investment managers).


That kobe quote is poignant and experience on a much smaller scale than kobe was on, has taught me the same. Also, your advice re: single private investment is spot on. If you read any story about a formerly rich athlete, etc going broke, it invariably involves a large investment in a dubious, high risk scheme (restaurants, companies, real estate, etc).


Sound advice. Also, I can't help but read it in the Baz Luhrmann "Wear Sunscreen" voice, which was a nice bonus.

Be careful and thoughtful about where your money goes. Spend on memorable experiences and things you and your family can enjoy together. Maybe use this as an opportunity to find hobbies together and get even closer than you are now. Enjoy!


Re the 1% thing: might be worth it. Lots of people chase returns and pick risky investments. Instead of picking a diversified portfolio of index and/or blue chip stocks and sticking with it, they "play" the market, and almost never beat it. The 1% to a wealth advisor saves you from yourself. Of course, milage will vary


I think most everyone in the sub-$25M bracket is better served paying a broad-based index fund 0 to 4 basis points for VTSAX or similar and using fee-only planner/advisers for tax, estate, and investment advice.

Completely agree that if OP wasn't previously a skilled investor with a track record of beating the market (extremely unlikely), that they shouldn't now try to become one.

With this amount of money, they've "won the game" and have no need to beat the market. They only need to match the market over the next 50 years. That can be done very simply, reliably, and cheaply.


Having worked at a hedge fund, most "skilled" investors aren't. I would just do what you've suggested and park it in a diversified portfolio of index funds even if I had all that money. I've seen some atrocious usage of investor money at hedge funds. It mostly goes toward stoking the ego of the partners.


I think you should not chase returns and pick risky investments AND not have a 1% manager. You can pay for a good CPA and a good attorney, but I am very skeptical that in the long run you will do better with someone managing your money than ETFs and bonds. There is a myth that the wealthy get better advice. Sometimes. But people that want to advertise their skill advertise to the wealthy. There is tons of survivorship bias in wealth managers. You tend to hear about success, people are embarrassed by setbacks. Take it with a grain of salt.


As someone who has been in your shoes to a lesser degree, here are some things I learned:

It is best to not upgrade your lifestyle at all, but instead to use your position to bring broken people out of the pit. Here is why:

- 1. It is better to end the suffering of someone else than to make your own already-awesome life slightly better.

- 2. If you lose everything like I did, you will have actually lost nothing and only gained friends and good deeds.

- 3. Humans are insanely envious creatures. If anyone figures you out, they will most likely hate you and secretly hope it all burns. Before this, I never experienced the butt-end of envy. It can be so isolating; even if you are the nicest person.

One other thing: Don't completely fall into the lifestyle and mentality of doing whatever you want, whenever you want to do it. Maintain a connection to some kind of job or responsibility where your reputation is on the line; something where there is accountability. It will be incredibly difficult to return to "normal life" if something ever goes wrong.


Except attempts at "ending the suffering of someone else" will more often than not break them even more, and leave you both broke. Free money messes with people in ways that you might not expect.


There are pretty clear cases where it is a net win. Helping a kid with malaria treatment isn't likely to throw them deep into the paradox of plenty.


Also, once you open the tap, you can't close it. Spending lots of money is like a drug - instant gratification.


Sorry, that must be really difficult. If it's not too painful to talk about it, would you be willing to share how you lost everything? What would you have done differently?


Great advice right here. Pretty much every philosopher worth his/her salt will point out that money and power can't buy happiness...but feeling like you are making a meaningful difference in some way just might


The thing that concerns me is that "I do not think I have any real hobbies."

I suggest continuing to work, but perhaps being pickier about where you work. Perhaps there's a dream job you've always wanted to do that up until now wasn't feasible because it doesn't pay enough, like fireman, park ranger, teacher, musician, etc? The key here is to have an obligation (people depend on you) and social interaction.

Also, see if maybe you can develop some hobbies. It can be as simple as hiking or collecting stamps. Preferably one that has a social aspect so you have human interaction.

You're going to need, at the bare minimum, a passion project to keep you engaged.

Sometimes, retiring early is the worst thing to happen to a person. Make sure you know well in advance how you're going to fill your days. Because having a bunch of empty days in your immediate future can be very detrimental to your mental health.

Good luck!


"Also, see if maybe you can develop some hobbies. It can be as simple as hiking or collecting stamps. Preferably one that has a social aspect so you have human interaction."

I would avoid material intensive Hobbies where you can buy accomplishment.

Unfortunately I am not in a similar situation but if I was I would try to maybe put some effort in to being healthy and not just focusing on beeing stimulated constantly. You can afford taking it slow, give it a try.


Agreed, it's super easy to pick up a material hobby (like collecting something). Instead, I'd pick up a working hobby. Let's say you really enjoy volunteer work. I'm sure there's a ton of good not-for-profits that need an experienced project manager.

Money can't buy happiness. Money can free up your time to explore enriching endeavours. A windfall should be a gateway to really explore what the world has to offer without limitations.

My top things that I would do in this situation:

- Make sure my debts are paid, and ensure long term stable income

- 1 hour minimum workout every day

- Be outside as much as possible

- Learn new applicable skills (home or auto repair, woodworking, music, etc...)

- Possibly go back to school

- Play video games

- Read more

These are all things that I try to do now, but don't have the time because of work or debt.


- Make sure my debts are paid, and ensure long term stable income

Totally. No need to carry a car loan, mortgage, Credit card debt anything anymore.


Depending on the mortgage rate, it might be better to keep it and invest the money that would have been used to pay off the mortgage instead.


Nah, once you've got 8MM in the bank there's no point worrying about maximizing returns. You've already won. Keep it simple, pay off the house, enjoy life.


This is exactly right. Mortgage/debt represents risk. Many people do the math on potential returns, but calculate risk as $0, which it definitely is not. I think it helps to consider this transaction in reverse. If you had a paid for house would you mortgage it so you could put that money into an investment account at Schwab? Almost certainly not.


If you pay off your house, shouldnt you also set aside ~10 years of annual property tax + X%/year for upgrades/fix/whatever - such that you literally do not have to think of a house expense for a decade.

Add in a lump sum for the monthly utilities for a decade and make a house account. Have the house account pay all these other incidentals from that account which you otherwise ignore.

Then, anytime you look at your bank account, the future costs of living in that home are never reflected in the balance you see in your daily account(s)


some would say that depends on the cost of borrowing. i know high net wealths that borrow any time they can if the rates are low enough.


And this is how monetary policy works :)


I felt the same. Hobbies, especially the ones that promote health or fitness (like some cool sports) would be something I'd clearly look out for.

On top of that I'd be very keen to invest in health of both yourself and your family. Dead people do not enjoy wealth, and while the sick sometimes need money to fix themselves up one can argue they do not really enjoy it. Some doctors may help you with a proper preventive plan that involves some recurring tests, I'd certainly invest in that. You may need a few, like: an MD, a holistic doctor and a nutritionist.

Then investigate what it takes to "live healthy" for you. Food (more raw organic produce), exercise/sports (yoga, running, cycling, gym, climbing/bouldering, kite surfing), some spiritual practice (meditation, breathing techniques, some philanthropy). This all can bring a person years of healthy life.

If your are not hung up on the location to live, you may want to explore some over the years. Having 2 places to call your home is well within reach. Then if you are into it, you can build, or remodel a place to your interests: a hobby in itself.


For you or anyone else who is looking for hobbies, there is an enormous universe of amazing projects that desperately need volunteers with modest levels of skill.

I run a small science fiction magazine with some friends and we're always looking for support to help this project grow. What we need most is volunteers who can commit enough time to learn the ropes and move the project forward - it's hard to find anyone who can commit more than an hour or two a week.

Pick literally anything that you are interested in, and there's likely a community of people trying to do interesting things in that field. All you have to do is reach out! So, go get 'em.

You have the freedom to chose what you do with your time, but that freedom could become crippling if you don't fill it with something that you find meaningful/fulfilling.


It can be equally detrimental to your physical health as well.


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 listen to advice from the internet, your friends, family, any personal wealth manager, or anyone who wants you to invest in their business.


> My advice is do nothing with it, and start reading books about finance, investing, and money management.

I see where you are coming from, but if you step back for a second, this just sounds bizarre.

OP now has more money than they need or ever have had, and instead of relaxing and finally caring about something other than money, you suggest they actually start caring more about money.


Yeah, try to ignore the fact that it's money; imagine it's some other asset the person wants to keep, like 100 ponies.

You would definitely suggest reading up on how to successfully keep ponies, right?


They are not closely similar. Ponies will die if you dont know how to handle them, money while being gobbled away by inflation will more or less hold its value.

It's a smart thing to do learn money-management at any point of your life, even more with a sudden windfall like this. The OP seems like a straightforward guy who isnt really interested in money hence this post.

So it's up to him what kind of impact he'd like to have to the world around him. If you really get down to it there's no wrong or right way to proceed. To maintain that wealth he should definitely learn how to manage it. To spend that money on things he deems important he probably doesnt need to learn much money-management.

Wisest thing in my mind, and what others have suggested, is to wait and ponder what he really wants to do in life. Maybe read some money-management books, sure. To see if it's any interest to him.


Not always plenty of rich Boxers, Sports stars have lost vast amounts of money and ended up destitute.


"... money while being gobbled away by inflation will more or less hold its value."

This is a false statement. In fact, it is false ipso facto.


It's quite silly to say something is false without providing a logical reasoning. And what is false about that statement, that it will absolutely not hold its value? Sure, but it wasn't my main point.


If he's into ponies, yes, but most people don't care and would rather do something else.

In this case, selling the ponies and do something they like with the money.

Or selling some ponies, and pay someone to take care of the rest and make them reproduce/sell them, so that you can live with the pony-benefits.

It might not be optimal pony-wise, but it definitely makes more sense life-wise.


That's for the part where they need a hobby.


Ponies are not a fungible currency that underpins almost all of our day-to-day lives.


Thinking you have more money than you'll ever need is the first step to losing it all.


Exactly. If it were me, managing that money would become my full time job! Might even consider raising the kids to run the “family business”, they could become financial professionals as a career.


It's more like homeownership. It doesn't need to become your life, but you do need to be aware of the risks and start thinking about maintenance.


>you suggest they actually start caring more about money.

This is how the rich stay rich. You can't just spend (I mean, you can if you're really disciplined and treat it like a retirement income). When you've got a lot of money you need to park your money somewhere it appreciates and then skim off some of the appreciated amount when you want to use it.


Unfortunately, that's what happens when you get a windfall. It happened to my wife and I when we sold our company. It's a fantastic "problem" to have, but it takes some time to get comfortable. This is especially true in OP's case, when they could feasibly retire immediately.


I diagree with you, in a sense this is now a huge responsibility, especially if you see this windfall as the start of a family legacy, something to be rolled forward for all time. I would read about legacies. How did the Bushes, Kennedy’s, etc do it ?


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.


Even if OP spends 1M on college fees ( I forgot how expensive it is in the US ), I would imagine that they'll still be very comfortable for a long time.

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?


no one needs to spend $300k in a year, but unless you are some kind of ascetic monk, you are susceptible to lifestyle creep.

the reason i bring up college expenses (which are about $70k/year at top US schools) is that parents tend to do whatever they can to give their kids the best possible chance in life. even if someone is not purchasing luxuries for themselves, it's not hard to spend tons of money on children. about $600k needs to be set aside if he wants to guarantee that his children can attend any college they can get accepted to. in the meantime, there are plenty of expensive things he can do to improve their chances of admission. maybe this means buying a house in a better school district or paying for private school (possibly >$40k per year per child). maybe it's private SAT prep to boost test score. extracurriculars are also very important for admissions (and are enriching in their own right), and the most impressive ones aren't cheap either. there's always something you can spend more money on to improve life outcomes for your kids.

you can't just say "I have a lot of money, I'm going to spend modestly, and everything will be alright," and have it be so.


Your holidays can become progressively longer and more extravagant. The cost of this can add up quickly. Maybe you previously just went to Florida for a week for vacation. Now you decide to take the family to Italy for 3 weeks in the summer and to New Zealand in the winter....

There can also be an urge to buy that vacation home in Tahoe or Jackson that you always dreamed of. Maybe you used to rent a house in Tahoe for a weekend every winter before windfall. Now you buy a place and have a mortgage for a cabin that you use a handful of times a year.

Before you know it, you can have a lot more expenses creep up.


Add up a few even ifs of $1M each, and the comfort level drops considerably. $8M should be enough to live comfortably, but it requires a bit of planning and a reasonable definition of comfort.

It doesn't take a lot of reading to get towards get a nice umbrella policy, talk to an estate lawyer, and then put most of the money in a diversified bond fund and a diversified stock fund', and plan to pull out a small % per year as your annual budget; allow for large expenses occasionally, but be aware of the impact on your future annual budget. Maybe set aside a specific amount money (in consultation with your significant other) for unwise investments, if you want to learn first hand why they're not recommended.


A fool and his money are soon parted, and whilst OP does not sound like a fool, he came to this forum for help so he would not act foolish.

To wit, this is probably the wrong forum if people are going to respond as you did, Sir, so he is probably better off over on Bogleheads.


I suspect the ratio of older HN people who have had experience of windfalls is higher than on boggleheads.

Though my personal game plan was take one of they founders of nominet worth well over 100m at one point) out for lunch in the best restaurant in Brighton and ask hime what he would have done differently :-)

Or do a cheeky letter to one of the Rosthchild's I met at fast Tuesday years ago


Try to imagine a third choice which is both caring about it and not spending it. And raising your children to do the same.


This. Buy liability insurance. It's cheap and sadly, you are now a worthwhile target.


In some places, liability can be based on lifetime earning potential, so OP may have already been a good candidate for liability insurance. Don’t wait for a windfall.


> Don't listen to advice from the internet

Strongly disagree. Don't listen to the wrong advice from the internet. Do listen to wise, earnest, un-conflicted advice from the internet (e.g., Bogleheads).


Can you elaborate on why you think he should not listen to a personal wealth manager (assuming that's the same as a financial advisor)?


https://www.reddit.com/r/AskReddit/comments/24vo34/whats_the...

> You will be encouraged to hire an investment manager. Considerable pressure will be applied. Don't.

> Investment managers charge fees, usually a percentage of assets. Consider this: If they charge 1% (which is low, I doubt you could find this deal, actually) they have to beat the market by 1% every year just to break even with a general market index fund. It is not worth it, and you don't need the extra return or the extra risk. Go for the index fund instead if you must invest in stocks. This is a hard rule to follow. They will come recommended by friends. They will come recommended by family. They will be your second cousin on your mother's side. Investment managers will sound smart. They will have lots of cool acronyms. They will have nice PowerPoint presentations. They might (MIGHT) pay for your shrimp cocktail lunch at TGI Friday's while reminding you how poor their side of the family is. They live for this stuff.

> You should smile, thank them for their time, and then tell them you will get back to them next week. Don't sign ANYTHING. Don't write it on a cocktail napkin (lottery lawsuit cases have been won and lost over drunkenly scrawled cocktail napkin addition and subtraction figures with lots of zeros on them). Never call them back. Trust me. You will thank me later. This tactic, smiling, thanking people for their time, and promising to get back to people, is going to have to become familiar. You will have to learn to say no gently, without saying the word "no." It sounds underhanded. Sneaky. It is. And its part of your new survival strategy. I mean the word "survival" quite literally.


>>...they have to beat the market by 1% every year just to break even...

It's even worse than that.

1% ON TOP of inflation, which is reported as 1.9% but many financial experts say the actual figure is closer to 4% once goods such as energy and food are factored in.

So the hypothetical investor must make ~5% just to break even. Anything less is a loss of spending power. Add 4% to realized losses and the figures can be especially gloomy.


Financial experts most certainly do not say anything like 4% inflation in the US.

Energy is extremely volatile, so it’s annual rate spikes up and down by as much as +/- 25% in any given 12 month period, but over longer time spans it’s close to flat, with US consumer prices driven down by fracking.

Food prices, similarly, are volatile, but have trended flat over long timespans.

Food and energy are going to be a tiny, tiny fraction of consumption for someone living off float from an $8 million windfall; core inflation (removing the volatile food and energy categories) is the right number to pay attention to.


I have a personal friend who is a wealth manager who basically gets his clients to put their money in index funds.

I wouldn't paint the whole industry this way. Some people are simply not good at handling money and paying someone to keep your hands off of it is wise.

For the record, my buddy works with sports/entertainment stars (and including tech founders who exit) that categorically have the worst discipline when it comes to money.


This is a recommendation for early management of a large windfall (large inheritance, exit or lottery winnings).

If in the long run you believe/understand that a wealth manager could do a better job than the basics and you want less safety, you can always hire one: wealth managers will still be there next year or decade. However if you get a wealth manager right now your funds may not be.


The cocktail napkin stories are one-off anecdotes that all law school students go through in their first semester to learn about what actually makes a contract. They are great example to show how a formal document with signatures is not the critical piece of a contract. They do not mean that you should never scrawl notes on a napkin because napkins have some special legal power. And any quote that implies such should be taken with a fairly large grain of salt.

Also, wealth managers don't simply try to beat the market over a short term. They try to help you diversify so that in the case of a market change or complete meltdown, you don't lose everything. You pay that percentage not to maximize every penny, but to make a reasonable return while minimizing your losses in odd scenarios, so that you can live on the returns while never even touching the principal assets. Again, anyone who boils it down to "just invest in index funds" is missing the big picture. (And that includes bad financial planners. If they give simple advice, call someone else.)


Agree. And some people will just sleep better knowing a professional is helping with their investments, and that's worth something.

One hint is to talk to a couple of local estate planning attorneys and see who they recommend for financial planning/wealth management. They will have seen who does a good job and who doesn't. It probably isn't the guy working at the local Charles Schwab or Edward Jones office in a strip mall.


Eh. You can just say no and save yourself all this hassle and risk.


Most of them are simply salesmen, selling high-load products. Incentives are not aligned, but if you can find one is who independent of any particular set of funds and who only earns from a percentage of your earnings, and not from brokerage fees or commissions, then it might be worthwhile but you should still learn about this stuff yourself.


^^ seconded. I've lost a windfall to an investment manager.

my business partner is all about liability insurance, and has had to use it.

to the OP, re: "should I donate it?"

yes, but not all of it. buy potting soil & sow some seeds somewhere.

also, to the point about investing generally... seems like maybe we're at a top, so pick something stable


There are different types of advisers. People often get burned because broker dealers, stockbrokers, and insurance agents do not have fiduciary responsibility (they do not need to act in your best interest). A fee only adviser (with fiduciary responsibility, which will only charge you a fixed fee is a solid choice and worthwhile to keep you out of trouble.


Yup, this is why if you really want to be hands-off with your wealth and put it in the hands of an independent professional, look for FEE BASED financial advisors/wealth planners. Finding one via NAPFA is one's best bet.


This is not nearly enough money to justify a wealth manager. People always think they're special when they aren't, and salespeople are always willing to encourage their delusions.


>My advice is do nothing with it, and start reading books about finance, investing, and money management.

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.


Speaking as someone who made a decent pile in cryptocurrency:

1. Don't ride on the stocks forever. You'll feel it as a windfall now, but it's an investment. You invested in the company, and it paid off, so you should probably part ways and start a new chapter, since the company's fortunes can change quickly. Every investment comes with risk and the more you have in one investment, the more you will feel that risk - so get some diversity in the portfolio as you are able to. Assume that you will have to give up a hefty percentage of the $8mm in taxes and fees in the process of doing so. Advisors can help mitigate that, but you want to keep watching the finances while you rearrange your life.

2. Even as a multi-millionaire, you can't afford "big things" like premium real estate or private jets. The numbers do not pencil out. It's healthy to still want a simple lifestyle and use the cash to indulge more modest luxuries. I like being able to order anything I want from Starbucks!

3. It doesn't matter if you succeeded financially, you'll still have plenty of things to struggle with in life - the Stoics say as much. The only difference is that you have room to choose which things you struggle with. You don't have to plan to take on the world, but you can now devote yourself to any altruistic pursuit you wish, any academic study or athletic achievement, or travel wherever you like, for as long as you like. These are things that you mostly can't do if your existence is premised on paying the bills. But you do want to stay hungry in some way, even if a paycheck can't do it.


OP said the $8M hit his account after taxes.


Not next years taxes. Hence, why tax shelters exist.


This sounds much like the situation Paul Buchheit found himself in as Google employee #23.

He wrote a blog post [1] on this topic back in 2010, in response to a HN thread just like this.

Note that the post is no longer available on his own blog, so as you're reading it, try to read them as the words of a 2010 version of Buchheit, not a present-day one, as it seems that for whatever reason, he doesn't want this post attributed to his present-day self.

[1] https://web.archive.org/web/20180119114049/http://paulbuchhe...


HN founder Paul Graham has some fantastic advice[1] on how to avoid losing your fortune:

When we sold our startup in 1998 I suddenly got a lot of money. I now had to think about something I hadn't had to think about before: how not to lose it. I knew it was possible to go from rich to poor, just as it was possible to go from poor to rich. But while I'd spent a lot of the past several years studying the paths from poor to rich, I knew practically nothing about the paths from rich to poor. Now, in order to avoid them, I had to learn where they were.

So I started to pay attention to how fortunes are lost. If you'd asked me as a kid how rich people became poor, I'd have said by spending all their money. That's how it happens in books and movies, because that's the colorful way to do it. But in fact the way most fortunes are lost is not through excessive expenditure, but through bad investments.

Be careful with anything other than the most ultra-conservative investment if you're putting millions into it.

[1] http://www.paulgraham.com/selfindulgence.html


Mental trick I recommend: You don’t have $8M - you own a business that lends money to people. Your business gives money to various companies through financial vehicles called ‘index funds’, which ensure that your loans are distributed across many different companies. The businesses use this money to fund their ventures, and are happy to pay you some money for the access to this capital. Your business is quite successful, earning you (.03 * 8M) = $240,000 per year. If someone else saw your balance sheet, they may be willing to pay you $8M for access to such a lucrative and easy-to-run business! Thinking this way allows you to spend the money however you want. Want to buy a Lamborghini? Go ahead! Use your $240k salary to finance your new car, just like any other normal person. But NEVER mortgage or sell any part of your amazing business just to buy a toy.


Having been in your shoes, and having had many friends in a similar place, I can only share what did and didn't work for us.

Diversifying was a positive for everyone who did it. John Doerr's advice to a friend was 'sell half' and diversify that. Because of the dot com crash (which may have been an anomaly) the folks who diversified completely (sold it all and moved into a balanced portfolio) did better.

Not changing your lifestyle. You have a 'burn rate' just like everything else (car payments, house payments, tuition bills etc). Leave that alone and your life will continue as it has, only more securely. One of the folks I know switched over to the lifestyle of the 'rich and famous', lots of parties, upgraded house, new cars, vacation trips all around the world. Burned through all their wealth and when it became obvious they had to go back to work, was in the place of going to people who had known them as the rich playboy type, and really impressing upon them how much they needed a job. It wasn't fun for them.

I would recommend you work with a financial adviser, or take a class at a community college on the basics of finance, or both. Back in the dot com days when I thought I was going to be a zillionaire I took the Forbes Wealth Management home study course. It was like 30 cassette tape lectures and a workbook. It did a good job of covering the foundations so that I could understand what people were talking about when they were comparing various options.

Put some aside for your kids college, giving them a debt free college education has a strong positive impact on their future success.

Sleep better and take care of your health.

EDIT: And talk to a tax accountant. Seriously. Moving around money in the "wrong" way can expose you to serious tax liability that might be surprising to you come April.


Retire. You can live off the interest if invested in mostly stable stuff (so I've heard) assuming you don't have a larger tax bill looming.

You may read lots of "awesome coder, great bizdev person" stuff online but 95% of the people out there in Tech are just working on someone else's idea/company bringing home pay. You are free from that now.

Be bored for a while and your interests will emerge. Take up a hobby, be a stay at home dad, think back to what excited you as a kid and explore those things.


Retiring is pretty dull at age 43. Maybe work on something you're into but which doesn't necessarily bring in much money. Personally, also having some money, I'm working on startup idea to fix the world etc which currently brings in zero money but is fun. Maybe it'll turn in to something real later, who knows. By the way re investing I recommend mainstream stuff like blue chip stocks, income producing real estate etc.


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.


I agree. I am 46, and my wife was joking a few years ago that we're living a retired's life. (I'm working from home, but at a rate that's about ten times the local average, so it's pretty much whenever I feel like it.)

Complete freedom is amazing.


Not everyone is like us. I'm a relatively successful software engineer currently and I still think back with fond memories to when I was tech support sitting there answering 30 minutes of calls per 8 hour shift. For some people that's torture.


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.


Ideally you die with $0 left. As the philosopher Karl Pilkington once said, "The only reason you need money is in case you don't die today."


It should be more than a "hope." If you really retire (and really plan to never work again), you should have some reasonable confidence that you will never run out of money. Having 25x to 30x current expenses saved and invested is a good starting point.


I did have ~40x my monthly expenses saved. I just spent them over the course of about 40 months!

I had no illusions about not working again, but I did do what retired people do: whatever the heck I wanted!


Sorry, I meant yearly expenses!!!!


I knew what you meant.


x is usually years, not months. I think that 3-4 years is closer to a long sabbatical.


I don’t think that changes my original point that if you find freedom to do whatever you want “dull” then you are the problem.


How does that differ from your definition of retirement?


This.

Sounds like you have enough to live off of, with a little planning. Enjoy the time you get to spend with your family. Find a few things that interest you, taking some random classes, try new stuff. Were I in your shoes, I'd buy a home with enough dirt to build a shop and I'd tinker.


As one of the "wealth managers" who you apparently should avoid like the plague, I'll just put my $.02 here for what it's worth.

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.


Just to add to this, having gone through a similar situation I went it alone and kind of wish I hadn't. I simply didn't care to learn and stay updated about markets, currency fluctuations etc. So there were some simple opportunities I didn't do (even boring things like sticking cash in a 6 month CD to earn 1% instead of 0).

I do think the advice to "do nothing for a while" is the best advice though. Give it a few months, anyway. If and when you DO want to consider a wealth manager guy, find a guy who doesn't take a percentage and works for a flat fee. Still, they might get kickbacks from certain investments so don't just jump into anything if it doesn't make clear sense to you (being skeptical is free, being closed off can cost you). I know a few high-up investment banker types and the interesting thing is most people with wealth aren't trying to find the next Apple stock but simply want to not lose their money. Most people with a lot of money invest with this mindset, so your feelings are pretty normal.

At a certain amount of money you start to realize there's no such thing as a safe place to stash it all. Keeping it in cash has risks (inflation!), FDIC only insures to a small amount and the stock market tends to move all at once because everything is tied together. So don't stress yourself out too much about it and don't try to get too cute because "you have a feeling the market is gonna..."

Change your life as little as possible is probably the best advice for not spending too much too fast with the risk of forming lifestyle changes that grows out of control over 10+ years. But I DO recommend spending money on things that make your day-to-day life easier or happier. That could be anything from buying 30 pairs of the same socks and throwing away your old ones so you don't have to find matching socks all the time to moving closer to work (if you still work) so you have less of a commute, or anything in between. I found it really helpful for a while to ask myself "is this something I wouldn't previously buy but it will improve my happiness every day?" If the answer was yes, I mostly made that change and it helped me continue to apply money to things of value without hamstringing myself needlessly.


Well that the thing though a therapist will cost way less than 80K a year.


Comparing opening a Vanguard account and dumping a few mil into Admiral class index fund shares with the complexities of FUSE is a clever, albeit entirely inaccurate, attempt at analogy.


$8M is a big chunk of money, but most retirement advise being followed by the upper-middle-class still applies to you. If you follow the recommended investment advice given to retirees, you can afford to withdraw ~4% of your principal every year in perpetuity. This comes out to ~$320k (inflation adjusted) per year. Find a financial adviser with fiduciary duty, and he can help you get set up with this.

If your wife is working, I'm guessing $320k/year is a little higher than your existing household income. What that means is that both your wife and yourself can now quit your jobs and still maintain the same quality of life you currently have.

Note that quitting your job doesn't mean doing nothing. It just means that you can be intentional about what you want to do. If you want to spend time with your kids, read books and travel the world, you have the option of doing that. If you want to work as a teacher or non-profit volunteer or even start your own non-profit, you have the option of doing that. If you want to go back to work as a tech manager, you have the option of doing that too.

It may take you a while to figure out what you really want to do with your time... but don't try to rush it. Once you've quit your job and have time to think and experiment, you'll eventually figure it out.

The most important thing you can do in the short-term is to not burn your principal on something stupid like a private concert with a celebrity. The $320k/year I mentioned earlier is assuming that you have the entire $8M invested. If you splurged half your $8M upfront, your investment income will drop to ~$160k/year. Still a nice amount of money, but you'll find yourself in a situation where you have to continue working to maintain your desired lifestyle.


Be careful: You can burn through $8M post-tax quicker than you think. We have a annual household income of >$1M pretax, so I have some experience here.

I'm assuming you live in the bay area. The price of nice but not stunning houses in many desirable areas is around $4M. Assuming your life expectancy is another 50 years, that's at least $45K/yr in taxes, so at least $2.2M in lifetime property taxes. The median home in Palo Alto is now >$3.2M, and that figure includes small or decrepit teardowns listed for land value alone. You won't be able to afford (and it would be a mistake to buy) some of the larger or newer houses on the market for $8M+.

Private school for two children can approach $100K a year (Castilleja in Palo Alto is $44K/year). You didn't say how old your children are, but if you include preschool and college, that could be $2M. You might want to hire a nanny. That's $30/hr, or over $70K/yr with employer taxes, or $1.4M without a raise for 20 years.

That's $9.6M for just a house, schooling, and child care. That doesn't include food, household cleaners, insurance, clothing, landscaping, pool maintenance, cars, a second house, hobbies, gifts to children, travel, etc.

Sure, maybe your investments will do OK. But on the other hand they need to beat inflation. Castilleja isn't getting cheaper. Your property taxes will increase, slowly but steadily, every year for life, and then there are local bond measures for additional taxes.

So my advice is to live below your means. We've tried this ourselves. Also you might want to stay employed, at least one of you, to extend your runway. Finally look for something meaningful in life. Attend a local church service over Christmas. Spending money by itself won't do it.


Friend of mine in his 60s who was semi retired for the last 15 years had all his brokerage accounts emptied by hackers this year. He might get his money back, but might not. Make sure you use 2fa for all accounts. I prefer RSA secureID where you have a detached fob. Your phone can be hacked and hackers can then get verification codes.

Dont invest in anything except (almost) guaranteed returns for now(1 year CDs are starting to pay 2-3%) .

An emergency fund of 2+ years expenses in cash.

Slowly increase your standard of living over a long period of time (or not at all). I operate from a budget, not from cash in the bank. Religiously stick to the budget (this is hard) but dont beat yourself up if you go over. Quicken does a reasonably decent job of setting up a budget and allows you to keep spending in various "accounts" under control.

The standard safe withdrawl rate is 3%. Im planning for a more conservative 1.5% approach. This means you can take out up to 3% of your total funds each year and never run out. At 8m and 1.5% safe withdrawl you still need to work.

The strategy requires you to have a reasonably significant percent in the market. While the market could keep going up, I think you can wait a few years for the inevitable recession, but eventually you will have to get it into index funds.

I make a good income from my business and it is easy to get sloppy when I have too much cash. Last year at a fundraiser I got drunk and dropped 30K. Im not mad about the donation, but Im mad about the way I did it while being out of control.

Also this account is an example of a wasted $100k :)


> At 8m and 1.5% safe withdrawl you still need to work.

$8m at 1.5% is $120,000/year. Since he's already mentioned the house and cars being paid off already, that's going to be a living wage even in Silicon Valley, especially considering he also said the $8m is AFTER taxes. He doesn't need to work.


Congrats! Perhaps start here: https://www.reddit.com/r/personalfinance/wiki/windfall


I see reddit mentioned by multiple people. I think the sub https://www.reddit.com/r/financialindependence/ might also be a nice fit, as it is about how to become financial independent (already achieved by OP) and then what to do after (retire early? how to manage the money? etc)


warning: high value individuals can expect a fair amount of abuse on that subreddit, it's for how to get to FI not how to manage being there


For those that fall into this abused category, a lot have moved to https://www.reddit.com/r/fatfire


I'll second this, all of the FIRE subreddits are not a great place to discuss your situation. Those subs are full of people saving about 40-50-60%+ of their take home and slowing building wealth overtime.

Edit: FIRE = Financial Independence, Retire Early


I came into a windfall about a year ago. I found that it's easy to fall in a rut. Having so much money made me feel like that what what other people perceive as the biggest thing about me. I miss the praise and respect that a job well done gave me, that I had while working. After retiring, it's easy to think that, besides the money there is nothing worthwhile about me.

Then there is the question about what to do when meeting new people and they ask what I do? Tell the truth, and I create this weird social dynamic. Mutter “computer programmer” and I've just stunted any possibility of a real longterm connection by not describing who I truly am. Not sure what can be done about this, except say to prepare for loneliness.

The other piece of advice is to get deeply involved in learning something or creating something. I was amazed by how much the feeling of accomplishment gave me happiness and contentment over going to a fine restaurant or buying expensive clothes.


Maybe don't associate your existence with programming, tell them you're a guy with interesting hobbies and wide knowledge who just happens to do programming to empower people to do things/pay the bills/insert narrative here.

As with everything, it's more about the perspective and delivery than actual message.


Put it all in VTSAX. Sell 4% or less per year. Enjoy a six-figure income for the rest of your life. If anyone ever asks you to do something you don't want to, tell them "fuck you".


This. Mr Money Mustache and JCollinsNH (Simple Path to Wealth) all rolled into one comment. Wish this was higher up.


I don't suggest the 'do-nothing' route. Time is limited. I'd suggest:

1) Splurge a little bit. Like $100k. Buy that Oculus VR you've been thinking about. Trade in your car to the new Tesla Model 3. Your wife has been eyeing a vacation to Hawaii for a few years now, go do it. Finish off your mancave basement project. Life is great, enjoy the fullness thereof. Don't feel bad about buying your kids a dozen new nerf guns and video game systems.

2) Focus your time now on improving the quality of life for others. You're rich. You've made it. You can live off of 2% interest the rest of your life and so will your wife/kids/grand-children. Now.... what are you going to do about the other 5.8 billion people on this planet who are struggling to make ends meet and are literally a few dollars away from death? Are you going to sit in your high-castle and collect bond coupon payments the rest of your life? Life is too short. What will be the legacy you leave this world? You have to do it now while you're still relatively young and healthy. Just volunteering your time and technology skills can affect the quality of life of thousands of people and their offspring for generations. Trust me, that's more fulfilling than buying a bigger house.


I just wanted to chime in to say that this is just terrible, terrible advice.

It's clear you're not speaking from experience.

One has to be incredibly careful with a windfall like this. $8m is not a whole lot - certainly nothing like what you're fantasizing. Behaviors like you're suggesting can be incredibly damaging and snowball fast.

This is why most people who obtain sudden windfalls (an extraordinarily high percentage) go broke within years.


First of all, the taxes are probably not all paid on it. Some shares have been withheld (perhaps at 28%) when the actual figure is going to be higher (if ordinary income) or lower (if capital gains). You will need to find out next year when you actually file what the figure will be and be prepared to cut your state and Uncle Sam a fair-sized check.

Second, there may be a lockup period where you can't actually access all of the funds for perhaps 6 months. Then, if lots of people stampede for the exits on the same day, you could see some volatility then.

In your situation, I'd plan to keep working (or doing whatever you currently do) for at least 6-12 more months. You have enough money to retire (figure that you can treat as income 3.5-4% of your investment portfolio each year, provided it's invested appropriately [mostly in equities], so you're looking at $200K-$300K in pre-tax income just from the portfolio).

Why keep working? Well, you need something to create stability, normalcy, provide the same social interactions (with other people going through some similar things, presumably) and it keeps your health insurance and everything else "normal" for a while.

Other advice around is mostly good. It's a retirement amount of wealth, but it's not a crazy-large amount, so your lifestyle doesn't have to change much (and probably shouldn't) If you were happy 3 months ago, you should be about as happy now (not a ton more and not any less).

Don't buy annuities with it. Or at least not without talking it over with at least 3 financially savvy people that you deeply trust and letting the idea kick around in your head for 45 days.

Give it time to settle. Don't be in a rush to go through any "one-way" doors (quitting job or locking the money up in complicated investments). Put the money in something like VTSAX while you wait (that will give you broad-based stock market exposure).


I don't see how not having access to the funds applies or that the stock price might have volatility since he said the money was in his bank account already.


OP called them both "stocks" and "money" seemingly interchangeably. (I don't recall the title showing "all cash" when I replied but maybe it did.) If it's actually in cash, you're totally right of course. Some people treat vested and released shares as if they were cash and look at the balance (shares times last trade), call it "money", and start making plans based on that.


Spend time with your kids. You'll never get another chance.


This. At 43 you're about half way done if you aren't unlucky. Spend time with the family. They're all that will matter to you later in life.


And avoid spoiling them [the kids]?

Most of the comments about not losing wealth amount to either poor investment or "spoiling" oneself - ie spending excessively on luxuries. But, I imagine it's harder to avoid spending excessively on other people; what does "my parents can just buy me a new one" do to a kids perception of value, how do they develop a sound work ethic, would retired parents in their youth have a negative hold over their ability to perceive themselves as workers (for themselves or others).


Gosh came here for this advice and can't believe how far down the page it is.


Indeed. Focus on what's important, like family.


There are many valuable answers here. I just wanted to say that you seem a humble guy and I'm happy that you are aware of it because that's what puts you in the right starting position. I think if you manage to keep your head there, you'll make the right decisions.


Congratulations! You've finished the hardest game of life. Now you can never do anything you do not want it again, if that's your wish.

Now you can do whatever you want. This includes: Spend how much time you want with your family and important people to you; Work on something you really want, or some significant project for you; dedicate your life to arts or an hobby; Have time to know wherever you want; Take maximum care of your health; Take some risks in general, but not so much, or you might end up dying or being broke again; etc;

You have three resources to manage now: Time, Health and (assuming you won't spend all your money at once) your stocks/bonds [EDIT: or any other passive income of your wish.].


i invested close to the ETH ICO. just $10k or so, but that gave me a windfall of $3.5m (I sold in early to mid-December).

im not super conservative with my money (i.e., i don't do t-bills, and other "super safe" investments).

i am just dollar cost averaging into index funds, like ive always done. I anticipate that I'll get anywhere from 5% to 15% per year, compounding.

i also have pre-tax income of roughly $500k. i still abide by my financial plan as if my windfall didn't exist. we save about $100k a year.

im around 31, so im hoping that the combination of these two will lead to enough accumulation in wealth by the time im 40 that i can retire early and live off investment income.

by my current calculations, assuming increases in compensation (and retirement contributions) that match inflation, and based on my current war-chest, I should have between $8.1m to $19m by the time I reach my 40s. If I average out investment gains to 8% compounding, we're looking at $10.5m.

By that point, 5% gains should give me around half a million to live off of every year. And anything higher is icing on the cake.

And I can definitely live very well on that budget. That's basically life now. And life is good.

i'm not going to tell u what to do, but just sharing my experience.

other people made a lot of money doing similar bets in crypto. they decided to launch crypto funds, buy altcoins, do more investing.

i just recognize that i got very, very lucky, and decided to take cash off the table. ill still do some risky betting with my money, but that's with a very, very small % of my investment capital.


Isn't index funds risky for living off year-to-year returns given they have up to 50% drops occasionally? Especially if you assume up to 15% return which sounds super optimistic too me.

E.g. You would have made 0% return off the S&P500 between March 2000 and March 2013. That's 13 years! That would burn through 5,2 million off your capital at your expense rate of 400k


note this isnt incompatible with "upgrading" your life. it's all about setting a sensible financial framework and living within that framework. if that framework permits private jets and lambos, go for it. but if it doesnt, dont. bankruptcy and financial ruin happen when you spend money blindly. but if you work within the framework you set, it shouldnt be hard. because i strive to live within my existing framework, i havent upgraded anything. my close friends and family say im being cheap, but i think im just being smart with my money.

you obviously got a bit more, so framework can be a bit larger. Good luck :-)


I invested close to the ETH ICO. just $10k or so, but that gave me a windfall of $3.5m (I sold in early to mid-December).

Wow. You got out at the top. ETH has dropped 90% since then.


You ought to put some in t-bills and FDIC insured CDs. Putting all of it in index funds is too risky.


What are you doing that you have a take-home of $500K?


I work in venture and my wife is a consultant.


Damn. How do I get into venture? I'm ecking out a living as a chief architect.


My path is 1% hustle and 99% luck. Given how lucky I've been, and worried about regression to the mean, I play things relatively conservatively :-)


Good on you. I might ask for some lottery ticket numbers at some point :)


Figure out what your liabilities are. Wealth is one side of your balance sheet: liabilities are the other.

Want to retire in the Bahamas? Want to make sure the kids are mortgage-free? Want to make sure the kids don't have to take a soul-crushing corporate job and are free to pursue their art? Those are liabilities.

Once you know your liabilities, figure out the best investments to match them. If you want to retire in the Bahamas, buy a place in the Bahamas. If you want to hedge against price rises in elderly care, invest in the healthcare sector.

Just make sure your assets match your liabilities and you'll be fine.


Assets matching liabilities is an accounting idea that has nothing to do here. Wanting to do something is not a liability.


Liability may be the wrong term for it, but if you want to do several expensive things, you probably want to make sure you've got enough money for all of them and prioritise if you don't.

Maybe you never want to work again, and you want to buy a yacht. It'd be poor planning to end up back in work at age 60 because you got a bigger yacht than you could afford at age 45.

That doesn't mean you can't buy a yacht, it just means you might want a 60ft yacht instead of a 100ft yacht.


Liability is exactly the right term for it if it costs money.


No. Liability is money you have an obligation to transfer.

Dreams that involve money are not liabilities, at all.


You'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 realistically you'll at some point want to reinvest most of that money into passive, safe(r) investments so that you can book a x% annual return and live off capital gains. (Fun fact; capital gains are taxed lower than income)

Feel free to put some (i.e. $500k to $1m) aside for higher risk investments if you feel like you wouldn't mind the money disappearing or going 50x.

Also: DO NOT JUST GIVE IT TO A BANK -- best way to pay a ton of fees and end up with no (or worse, negative) returns.

Also: (but this is me) I would give back to a cause you care about. Maybe something local where you know the money will have a big impact? Those donations are often also tax deductible (so might as well).


interesting comment.

since the bear market started, wouldn’t this be a good time to buy at bargain prices?


Give it a month or two to confirm the bear market started. If the bear market has truly started it has plenty of room to fall.


Bargain prices are at the crash. Beginning of the bear market is by definition the time when prices will continue to decline.

(I'm leaving it up to you to decide if it's a short-term correction, beginning of bear streak or anything else)


buy when there is nothing but negativity and depressive comments on the stock market; once we are there it is a signal of the bottom


when everybody including Goldman is expecting a crash , is it really a crash ?


> 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?


Give it to a bank, in the sense of handing it off to a private banker.


I recently met a friend's father-in-law at a party. He seemed like a super modest guy, and then I realized he acquired a similar windfall twenty years ago. He kept working at the same company, and then jumped to a project manager role at a new company. Even after major back surgery, he kept working like an average joe (and seemed to enjoy his job). Outside of family vacations, he has only made one major purchase from his fortune - a crash-pad apartment in the Upper West Side that ended up doubling in value since the nineties.

At the time, I thought he was a bit eccentric; maybe even a workaholic. Especially after reading this thread, I think he did absolutely everything correct.


I went through something similar a few years ago. Briefly, the things that stand out for me now are: depending on your circumstances and where you live, and your goals for the future, this windfall may not be as big a deal as you think at first. Create a spreadsheet and calculate how much you want to set aside for your kids, do you want to at least give them the option of studying at a top US University on full fees? Do you want to get them a foot on the property ladder? Do you want to fund a trust for them and your wife that matures at some point in the future and provides meaningful means for them to live on? What investments do you want to make in order to feel secure? For some people, this only comes through ownership of physical assets like land and buildings in juristictions that are stable and have well developed legal systems. Once you've got a handle on the long term goals, then make a habit of keeping a budget for your spending, there are lots of tools for this. It keeps you grounded and reminds you that every decision to spend money on something impulsively means you are taking money out of some other category. This doesn't change just because you have "lots" of money. I've seen many people (working in finance in London) who regularly got annual bonuses in the millions, who are now having to live very modestly because they allowed their lifestyles to expand unfettered and forgot the basics of long term planning and daily budgeting. Don't fall into the trap of thinking you are "rich", you have the means to have funded some of your long term goals but only if you are disciplined in future and continue to be diligent about money.

Best benefit of all is if this helps you spend more time with your family, and doesn't add stress to your life. Having lots of investments can be a lot more stressful than just having an adequate income and living within your means. Be careful of bankers selling your "wealth management" services.


I've been in that situation since the 1980s. I put the money into T-bills, back when they paid 7%. Now it's mostly in brokered CDs and index funds. I still have about as much money as I had back then, although I haven't quite kept up with inflation. Brokered CDs are useful because you can spread them out across multiple banks and get the $250K FDIC guarantee at each bank.

Most people who get a lot of money all at once blow it within 7 years. I found "The Challenges of Wealth", by Domini, to be useful.

The trouble with investing is that you're competing with people who are smarter than you and do it full time with other peoples's money. Not that they do it very well. VC funds, as a class, lose money. So do hedge funds. There really aren't many good investments right now and there's too much money chasing them. So go for safety, not yield.


Find 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.


If it was me I'd take whatever your current annual post-tax household income is, multiply by 22 (to get you to 65), and put it in the bank. This is the money you'd have made between now and retirement - treat it as a salary, paying yourself out monthly, and contribute to a pension as you would have if you'd been working.

Doesn't really matter what you do with the rest of your money, but I think hiring a personal wealth manager is pointless - you have enough, you don't need to grow it.


One thing for certain, it can go quick. If you do anything entrepreneurial, start with a small allocation of your total net worth, and keep your overhead low as possible. It is really amazing how easy it is to get trapped in sticky things like rental leases and salaries. I'd also remind, don't forget about basic safe fixed-income investments like USA Government Bonds. Sticking most of it in bonds at 2-3% is probably not the worst move you could make, over these next few years.


First, I would put my money somewhere safe, with close to zero risk until you figure out what to do. Depending on your living cost around 1% guaranteed return should be enough to not work again for quita a while, possibly for ever (that means you do not have any pressure on your finances ever again if you don't change you lifestyle). Put some money aside for your kids (education, base capital for a house one day,...).

Educate yourself on investment and then find someone to manage your money, in Germany I would go maybe even for some rich-peoples bank and invest with the lowest risk portfolio possible.

In zhe meantime, enjoy life and your complete freedom. I know it is hard, but now you can do whatever you want and you have the time to figure it out, too. Go back to college if that's your thing. Tutor students from troubled families or not so well off backgrounds (you think about donating, so I assume you have a social sense). Or do some consulting on the side. I would suggest to not brcome idle, that breeds boredom which doesn't go well along with $ 8M.

Or go a long vacation with your family, visit the world. That is if your wife and kids can come along with you.

In general, be patient, stay cool and take your time to figure things out. Be conservative with the money.

And finally, congrats to your near complete freedom you and your family have now!


> Depending on your living cost around 1% guaranteed return should be enough to not work again for quita a while, possibly for ever

Just a nitpick but even the "official" inflation rate is somewhere around 2%, is it not? The real one is probably 3% or higher.


Inflation is just an aggregate, based on a reasonably arbitrary basket of goods that someone decided is representative of the public's expenditure. If the basket doesn't reflect your consumption, then the rate of inflation isn't really relevant to you. Almost all PCE inflation in the last 20 years has come from housing, healthcare, education, and pharmaceuticals. On the other hand, the price of durable goods has fallen. The idea that inflation moves all prices together hasn't been accurate since the 80's.

The trick is to figure out what your liabilities are, how you might be affected by the price of X changing, and invest accordingly to attempt to hedge that risk.


I think there also should be a concept of 'personal inflation'. For example, if you consume a lot of electronics and only use little petrol or whatever is becoming more expensive that time, your personal exposure to inflation is lower than the official number.


Just continue your normal life of "average" (as you say).

If all $8m went into your checking account, the first "simple" step you can do is to start breaking up the $8m into different account types at different banks with you and your wife as depositors for FDIC insurance purposes, in case you are not paying attention or ready to do anything immediate with the funds. https://www.fdic.gov/deposit/deposits/

Then after this, your full time job can become just learning how to manage your money which includes self-education first, before hiring anybody. It is not that hard and I'm sure you can do that on an average, not very hardworking 8 hour day, 5 days a week :)

Since you are a tech manager and seem to know "pieces" of your job (coding and business) but not enough to consider yourself a specialist (like a coder or the business guy), use this same mindset to be a manager of a team you can build around how to manage this $8m. In truth, $8m is not a lot of money per se so you may not need a team ... most people will want 1% of that per year to manage it. Your hope is that they are making at least 1% + inflation rate but you would probably do better yourself.

Good luck and congratulations!


Don't buy expensive stuff, including houses and other properties. Maintenance cost a fortune and it takes an eternity to sell them if you want to cash out.

Don't lend money to people. Give money to people to help them if you want, but don't expect them to pay it back.


You now own yourself. You only have to work if you like working, and you can work at something that doesn’t pay much since you don’t need the money.

Watch out for isolation.

Try to change as little as possible because the truth is not much has changed except you owning yourself.

Don’t give it away. Don’t give it to your friends, they won’t be your friends if you do.


Put it all in a mix of a worldwide stock and bond index, look up the suggested distribution fitting youe age, probably like 60/40, then take a supet conservative take on the trinity study which suggests a 4% safe withdrawal rate and make it 2%. This puts you at 160k per year. In virtually every circumstance, you can reasonably rely on spending this amount annually, adjusted for inflation, and not run out of money, same with your kids after you die.

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.


I almost never post but here I am for you mate! I had a smaller version of your life but at 30 and have spent the last 12 years living happily with my family; wife and two children. We travel, still work from time to time when we feel like it on projects that interest us, but our family and selves come first. I exercise, took up squash, we went on a 7 month trip around the world last year etc etc. Our kids or not spoiled, other than the travel, which they would prefer to not do in order to stay in school :)

Do not squander, DO NOT work because everyone says you should. FOllow your bliss, read, learn, explore.


Amazing


As a father, if I came into that money I would use it to spend all the time I could with my kids. You don't get that time back and it's really precious and easy to take for granted.

Obviously you have to be guided by your own priorities which are different from mine. But I wanted to counterbalance the idea that you should "not do anything rash." Certainly, financially this makes sense; upgrading home, cars etc could bite you by raising your cost of living.

At the same time, you no longer have to give the best 8 hours of every weekday to a company. Your time is the most precious thing you have. At a certain point you will probably want to assess -- and I'm sure you would, regardless of my comment! -- if you want to keep allocating it to an activity that from what I can tell serves primarily to generate monetary income.

Just my $.02. In a way, like everyone in this thread, I'm living vicariously by giving it so do with it what you will.


Practical advice aside, take a step back and bask in the pleasure of the wonderful, unambiguously lucky thing that's happened to you. It's OK to feel excited and happy about all the freedom and peace of mind you now have.

Loved one gets sick? You don't have to think about money. Kids need something? It's taken care of. Getting 8 million dollars out of thin air is amazing and you shouldn't let your anxiety and self doubt stop you from feeling happy for a while.

You can figure out what to do with it later. Just enjoy having it in your checking account and looking at it every few hours in your bank's app. Buy something frivolous that costs $10,000 that you've always wanted. Give each of your family members a great gift. Donate $10,000 to something that matters to you. Let yourself spend $40,000 or so to celebrate, and then be responsible with the rest.

Congratulations, my friend!


$8M is fairly close to the number that I use for calculating "retirement ready" in the SF Bay Area. Assuming you live somewhere cheaper, the number is lower. Also my calculation involves some very large annual expenses that most people don't have, so your number is probably lower regardless.

So, you could probably retire.


First, 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.


Make a safe investment and go to work in a NGO which goals resonate with you. I'll get all the stability of a job, have social interactions with interesting people, and do good. Remember that now you have free will and you fc them all at any moment. A real superpower.


> Make a safe investment

there are no safe "investments", everything is a speculation.

that said, yes one could try and keep it conservative.


First, congrats. I think your humility comes through in your comment, which is refreshing.

The nice thing about money is that you can simply put it into an investment or savings and defer the decision about what to do with it. I recommend against pressuring yourself to make a quick decision.

I recommend just finding a new job or taking some time off and thinking about life for a while. Based on the time it has taken people I know to adjust after retirement, I'd give it 6-8 months before you can trust yourself to really know what it's like not to be obligated to work and to have your self worth defined that way.

So you may not want to retire, but I think an 8 month break would be a nice period of time during which to evaluate all of the options.

One thing that I think about is that in many ways my life is about as comfortable and pleasant as it could possibly be, even though I have not had a major exit. In one sense this is a good thing, but many philosophers tell us that struggle is what makes life meaningful.

So you might frame the question thus: Now that you no longer have to worry about basic financial security, what struggles might you choose to undertake that you could not undertake before because of your duties?

It might be a personal struggle (learning, accomplishment) or an inter-personal one... maybe political, maybe athletic or philanthropic.

The biggest thing to watch out for which you may or may not have encountered, is that people will flatter you extensively. While $8M isn't major wealth, it's enough that you will attract flatterers and your ideas will be given much more serious pondering. People will act toward you as though you are more attractive, smarter, and more insightful than you actually are. Beware of this because it is a reality distortion field.

Getting rid of the money quickly to avoid this sort of thing is a mistake, because dealing with it is just an important life skill just like learning to avoid people who are overly negative or mean-spirited.

Good luck to you!


I remember watching a sketch about a genie that was supposed to grant wishes, but instead gave reasons not to do it. The guy asked for one million in cash, and the genie told him that if he was capable of handling that amount of money, he would already have them on his own, so fulfilling his wish would be a total waste.

People already said it many times. Don't go in "rich mode". Take your time to figure things out, not changing your life too much. If you look at all rich people on the world, most of them work even harder than common folks to keep their wealth. Make sure your kids will learn to appreciate life and won't go poor without your support.

Congrats anyway!


Precious little conversation going on here about donating...

Lemme start by putting my cards on the table - I think it's morally wrong to be rich. In a world where people are starving to death for the want of a few dozen dollars a week, people with billion-dollar valuations and extravagances are among the worst people I can think of.

That said, I'm not going to stand here and say "if you don't give it all away, you're evil". It's absolutely a logarithmic thing, and even at $8m, there are a lot of questions and plans you have to make to ensure that you don't do the whole "sudden windfall" thing and end up worse off than before.

But I'm in a similar situation to you (sans windfall), and I know I'd feel awful not using at least some of that money to improve the lot of those less fortunate than myself. I keep a running list of organizations that I personally feel do plenty of good to causes that are important to me and don't just exist to funnel donations into operating expenses, just in case of a big exit or whatever, and I plan to start with 10% of the total and work my way up to as much as I can stand.

So definitely make sure you and your family are taken care of, take things slowly, try to get over the rush. But maybe re-watch Schindler's List, and consider investing as much as you can stand into good causes.


Firstly, congratulations! You sound very level-headed about it all which is refreshing. If you're UK-based I'd withdraw it all and hide it in a safe... FCS only protects up to about £70k (from memory) and who knows what state the banks will be in post brexit!?


If you're UK-based I'd withdraw it all and hide it in a safe... FCS only protects up to about £70k

OP almost certainly isn't in the UK, but even if so, you spread it around numerous banks and different asset categories (stocks, gold, bonds) rather than risk it all in a safe. Even just dumping £1m into an NS&I Income Bond would keep it pretty safe.

I'd personally diversify as much as possible and buy into a variety of funds covering most major geographic areas (e.g. a fund that tracks the Dow, one for the Asian markets, and so on.)


You're almost certainly right, I was being a little flippant.


Maybe best not to be holding cash during brexit..


Even in the most expensive areas in the world, this is a life-changing amount of money. Assuming that as you said this money is post-tax and you're not going to pull large pieces of it out to pay off debts, you're looking at conservatively being able to pull off $300k+ a year, every year, without touching the principal (assumes a 4% annual withdrawal).

I can only speak to what I would do as a 32 year old without kids. I'd follow the top comment and basically pause for a year. No big purchases, no extravagant vacations, keep working if you enjoy your job. Without touching it that amount of money is only going to get even bigger. And I'd find an estate attorney and fee-for-service financial adviser that I trust.

After that, chances are I'd retire. This is nearly 1% level money (in terms of income you can pull off it's like 90% of the way there). But it really depends what your goals are. This is truly enough where your kids would not have to work. You could work for a non-profit if there are causes you care deeply about. You could donate half of it and keep your job and still be in the $300k/yr+ club.

You could also risk it all and start a business or start investing in others' businesses. The world is your oyster at this point, man.


Hey mate its understandable you are freaking out a little. I would definitely suggest starting to do some education on basic finance and investment. Please tho dear god can you not do TWO things...just two things.

One...don't donate your money...donate some for sure, but most organizations generally fail by eating up the lions share of donations through administration costs and other costs of business. So your money gets nowhere...now if you want to make a difference this leads to point two.

Two. PLEASE dear god don't invest all of your money in stagnant safe investments, invest some small portion of your 8 million into starting a business. I don't mean this in order to grow your own wealth...but to help grow that of your community. I don't know where you live...but in Australia...the hoarding of wealth through property and the stock market is basically killing small towns/communities left right and center. Investing money in that doesn't really grow the economies of small towns/communities. Start a business, nothing huge, nothing too fancy, but invest in training you community/small towns! Seriously it will provide a bigger difference to those whom you employ than if you were to give to a charity supposedly servicing them!


You should not retire, but quit working. If you worked 9-5 you ll realize how much time was wasted in daily routines. What are your interests? Would you be interested to devote time to studying something (a phd maybe? you re not that old :) ). Why are you freaking out? money is a tool, it gives freedom of time and the ability to say FU to some thing, think of it like a tool not as a goal in itself.

Yeah, you should probably invest most of it responsibly. Don't buy yachts.


You have a once in a lifetime opportunity to be there for everyone you care for no matter what. Seize it with both hands. Don't tell people, just be your best self.


Was watching an ESPN doc about professional athletes that had earned a lot of money and suddenly became rich. These people usually came from low income (broken) families and had no idea how to manage this sudden financial change.

One of these ex-athletes now tries to educate the younger generation about this. He tells them:'Better to live like a prince for your whole life, then to live like a King for 5 years'.


I would recommend retiring and enjoying your time with your family. The money can come and go, but the time you have is irreplaceable.

Please consider donating and investing it in causes you believe in. There are so many ways this money can have a real positive impact to people and the world. Don't feel you need to throw massive gobs around - talk to the people running these causes and see what would help them out.


Sounds like you're in a state of shock. Understand that you don't need to decide anything now. Don't make any irreversible decisions yet. For now, why not take a year out, spend time with your family?


1. Get an attorney to make sure you don't get screwed in taxes or by some wanker trying to make a dime.

2. As you described it, I would say invest all of the money. If you're fine living humble, then use the money as security. With eight million you can pretty much comfortably. A low risk investment like a CD can provide you with roughly a 120K (@1.5% interest) salary.

3. Continue to work. But rest easy knowing that if you have a trash job, you can quit and find a new one without worrying about how you're going to provide.

4. Pay off everything.

5. Find a couple decent indulgences. Buy a Corvette or take the family on vacation. But don't go crazy. Spend 100k.

Lastly, I think being too comfortable makes people unhappy. Personally the times when I am most secure, are the times I am least happy. Take up rock climbing, skydiving, marathon running or anything that makes you uncomfortable (preferably without destroying yourself). It'll keep things in perspective. I rock climb, canyoneer and run Spartan races and those make me far happier than any amount of money I have earned thus far.


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".


> 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.


What If You Only Invested at Market Peaks http://awealthofcommonsense.com/worlds-worst-market-timer


Haven’t you been paying attention? We’ve been breathing for the past two months. My tech stocks have lost over $120k of value since September highs, in just two months.


Ha ha, I sunk a few $k in NVDA at $235, thinking they would not be affected by crypto currency (since most people use AMD).


You can’t time the market, so either advice is just as wrong/right. Though the stock market will probably be higher 10 years from now.


>> You can’t time the market,

What about these 4 guys just before 2008?

• Economist A. Gary Shilling warned his newsletter subscribers about a housing bust and wholesale deleveraging of household debt that would hobble the economy for years.

• Money manager James Stack also told his clients the housing bubble had burst and that a new bear market was coming—while stocks were hitting all-time highs.

• Raghuram Rajan, then chief economist of the International Monetary Fund, said the amount of risk and leverage in the system was much higher than most people thought.

• John Mauldin said a housing bust would lead to a drop in consumer spending, a bear market, and a recession (though at first he thought it would be a mild one), and that credit default swaps (CDSs) posed a systemic risk.

Plenty of folks "predicted" 2000 dot com crash and 2008 crisis. Noone listened though.


I did. So what? I have acquired some Google, Amazon, Apple and Nvidia in August 2007 - guess how much times it's higher now?


all i know is when people start to get cocky and complacent mr. market usually does not take too long to serve a lesson.

nothing. goes. up. forever.


I have been in your position for a month. I can honestly recommend leaving work and pursuing things that interest you instead of continuing to go to work, m-f, 9-5. It's just much nicer to operate on your own schedule.

Isolation is a thing though so make sure to maintain contact with friends and try to work with others. Contribute to open source?


Retire. I'd buy myself a hundred acres or so here in Indiana (probably not for you, but I like quiet), make a lazy 3-fund portfolio ( https://www.bogleheads.org/wiki/Three-fund_portfolio ) with a million in each fund, throw another million in a robo advisor and leave whatever was left as cash. I'd never have to work again, I'd have many times my FIRE number.

Then schedule a physical, an optometrist appointment if you wear glasses/contacts and a dental checkup. You now have time to be mindful of your health.

Then I'd just take a few months off. Do absolutely nothing. Just relax, think, recharge.

Then I've always got a bazillion ideas I want to pursue, I"m sure you have some too. I'd probably start working on the idea I'm currently waiting to hear back from YC for the winter 2019 batch. I could spend 20-30k of my own money collecting a lot of data and quietly looking for a key person or two to help me with the project and I might actually pivot and go more of a non-profit route with the idea.

You do you though, just be sensible about it.

Read about the Trinity study https://www.bogleheads.org/wiki/Trinity_study_update

Basically, if you put some money into a lazy three fund, or just a broad market/whole market fund you can likely retire and withdrawal 3-4% of the initial amount for the rest of your life depending on your risk tolerance. If you just did 3 million like I suggested above if I were in your situation, you have 90-120k a year to live off of relatively safely.

If you move somewhere with sane housing prices, pretty much anywhere in the midwest, you can live fantastically wealthy off that as the median household income in the country is 59k.

What I'd also do is take a small percentage of the money, maybe 50-100k and go Brewster's Million(s). Go spend it on something fun or goofy, something you've always wanted or wanted to do but could never justify. Get it out of your system. Something like these vacation experiences (secret agent for a day, vomit comet, shark diving) or buy that car you always wanted, or take a 700-702 AD French drunken pottery spinning while standing on one leg while singing Won't You Be My Neighbor class that you thought would be fun.


Here's some of the things I did in a similar situation- - I told work I was cutting back my hours. They had some concerns, so I'd start the conversation early. Currently I'm only working 4 days a week & it makes a huge difference in my life. - My wife & I picked out "IPO presents" for ourselves. She got a minivan, I got a nice grill. This seemed like a good balance between "don't do anything for a year" & "we worked hard to get here & can afford it". - if you can find a good fee only financial planner, hire them. We pay ours a ~$200/mo retainer to just talk about money things on our mind. She's been able to make many valuable insights & suggestions as we've been trying to adjust to the changes in our lives & futures.


Not to be a downer, but you might want to look into getting a post nuptial agreement and parking a good chunk of that money in trusts for your kids that you'll have access to for the next 10 or so years. This kind of money can change people, depending a lot on their background and upbringing.


Staying unemployed (if you're planning about leaving) is usually hard on most people mind. Try asking for a part time job (or look for a part time job) - that will leave you with enough time to think and find out new hobbies or what you'd like to do in the future.

Spend time with your wife and families, save in different places/accounts/things so you don't risk too much. Very often you don't have hobbies because you feel you don't have time - now you have that.

Just, imho, don't start overspending in stupid things, like luxury cars or boats or huge houses, or your expenses can go quickly out of control.

If you want a hobby, i suggest things that are 'physical' and group/community activities, maybe some sport or building things. See mr. Money mustache for inspiration.


Apparently you think you are average at everything, but it looks like at least once you were good at picking a successful tech company. If this sounds right to you, why not do it again?

I would set the money aside (invest it like others said in this thread) and join another company which looks like the one that just exited, but at the time you joined it. You should be valuable to them, especially since you have experience with hyper growth now.

If it works, you hit the jackpot twice, and you have learned that maybe you have a knack for this. If it doesn't, you didn't lose much, and you have $8M so does it really matter?

The only caveat is: avoid telling people at the new company how rich you are, and under no circumstance let them have you invest unreasonable amounts of money in them.


Don't do anything. The number one difference between needing and having is that when you need, the status quo is your enemy; when you have, it's your friend. If you need to pay rent, you gotta make money. If you need a new job or new clients, you gotta hustle. If you need to keep your bosses or investors happy, you gotta watch those metrics and keep on grindin'.

You pushed because you needed. Now that you have, stop pushing and learn to wait. If life was fine two weeks ago, it'll still be fine two weeks from now – as long as nothing changes. What $6M buys you is as much "nothing changes" as you want. The status quo isn't everyone's friend, but it's yours now and it takes some getting used to. So take your time.


  make yourself a million bucks
  partly skill, mostly luck
  now you can afford a down payment
  on a small house
https://www.youtube.com/watch?v=I6IQ_FOCE6I


My two cents:

First, Congratulations.

Second, breathe. Take your time. If you are still stressed about it, talk to someone IRL. It will really help to get the weight off your shoulder.

Third, beware of self-doubt. It sounds contrarian but I see lots of people who have a big win - money, beautiful girlfriend - start to doubt if they ever deserve any of it. They tend to go the "I am not that great. It is just a case of being lucky". And my answer is - You deserve it. You worked for it. You are awesome. Believe that.

Fourth, take your time understanding your options.

IMO, Bogle heads is a good start: https://www.bogleheads.org/wiki/Managing_a_windfall


Have you tried playing Warhammer? Eat up that 8 mil real fast ;)

In seriousness though, I think changing that "no real hobbies" statement is the way to go. Find something not work you enjoy doing, or if it turns out work is really what you enjoy, keep working! Don't let the money burn a hole in your pocket - you don't need to change anything at all.

Another option is do work you think matters or would be fun if you never had to think "but I couldn't support my family doing that.." Working at a bike shop is that for me. Charity work, maybe getting involved with your kid's education boards, etc., something out there must make you tick that you couldn't afford to do before.


First of all, congratulations! I've had a similar situation (with less money) but still, I went through the exact same exercise. You have 2 choices basically, you can keep working or you can retire.

When I say keep working I mean working for someone. Let someone dictate your day, week and year. Some people need structure in life to function properly so if you're one of them, I'd highly recommend you to get another job at another company in order to learn new things. Ideally, you'd study a new position in between so you wouldn't get bored too quickly. Switch to Product, design, or dev for example. You're not chasing for high incomes so that allows you to come in as an "entry level". You seem to be humble so that could fit you well. But definitely look for new challenges since you'll be spending most of your time at work. There's also the entrepreneurial route but I'd put that into the second bucket.

Retirement. Unfortunately, unlike you, I could not simply retire from the 9-5 life. When I say retirement I mean not having to work for anyone. What I would do is to work on my own projects and take a year or 2 to explore different domains and ideas until I'd find something promising I'd be deeply passionate about. Needless to say you'd be learning every day.

In terms of what to do with your money? Here is exactly what I'd do personally. I'd put $5 million into government bonds with a 100% guaranteed return of about 2.5-3%. That would bring you about $150k of passive income per year for the rest of your life (based on inflation rate). That's it! I'd move to a not too expensive place and I'd still have $3 million dollars left. I'd actually split it in 3 in your case. $1 million for each of your kids. For each kid I'd split it like this: 50% into a more aggressive portfolio like stocks, then 50% into bonds. I don't know how old your kids are but the idea is to lock these accounts until they get old enough to understand the value of money. With your million dollar left, I'd buy a new house for about $300-400k. Then I'd leave the rest into a savings account to be used for fun, big purchases, etc.


You know what? You don't need to do anything for now.

What you need to do over the next few months is answer a single question:

"What do I want to do with my life?"


> "What do I want to do with my life?"

That's a hard question without the $8M too :)


Indeed it is!

Also to add. If you can't work out the answer to that question then don't feel pressured into trying to force it.

It's ok not be able to answer the question. Life is a search for meaning. Sometimes it comes, sometimes it doesn't. The money in and of itself isn't going to answer the question. And in fact, freedom from the 'toil' required to make ends meet might remove some of the purpose that OP previously felt. But I think when faced with change and upheaval that removes the certainties of life (in this case 'work, eat sleep, repeat') you owe it to yourself to see if you can work out the answer.


There are good threads on reddit and other money forums that have advice on things like this, as I recall:

- Don't make any drastic changes to your life now

- Learn how to make your money work long term (diverse investments with plenty low risk etc)

Give yourself time to understand what you are going to do with it. You don't sound like the type of person that will end up like the lotto winners, but bear in mind a sudden increase in wealth can lead to pretty negative things if not managed.

Of course - it can bring a boatload of positive things too. Think of the things you could do. Retire early, help others, work on something special without worrying about salary, find a hobby :P Congratulations!


IIRC there exists an association created to help lottery winners. Your situation is kind of similar. I forgot the name, but if you google "curse of lottery winners" or something like that you should find a link somewhere.

According to some random article I've just found[1] for instance, one of the first things you should do is hiring an attorney. Sounds like a sensible advice.

1. https://www.businessinsider.fr/us/what-it-is-really-like-to-...


"Normal" Work is unlikely to provide you with much meaning from now on, as it won't provide an appreciable change in your living standard.

So, instead, look around at charities, or other positive works, and see what you can do to help them with your time.

Read the local news, and see what leaps out as being unfair or unreasonable to you. Spend some time researching it to make sure it's not just clickbait, but actually a real problem, and then go offer to work for them for free. A decent manager can do an awful lot to help a small organisation work well.


Don't do anything sudden, as others have said. But as you start to adjust to this, you may realize that there is something, or a few things, that you have wanted to do, but never could because of money. That place you wanted to go on your honeymoon, but it would have cost $2000 more than you could afford? You can go there now, on a second honeymoon. Take in a game at Yankee Stadium, even though you live in the Bay Area? You can do that now.

There may be several such things. Most of them don't take that much money (from your current perspective). Pick one of them and do it. (Note well: don't go do everything that you've ever wanted to do but couldn't afford to do. As I said, pick one.) You don't have to do it right away. It can wait a month, or a year, until it's sunk in that it's OK to spend a bit more money than I used to. Not a lot - you don't want to drastically change your lifestyle. But you also want to have some benefit from the money. When you've adjusted to the point that you feel free to spend $2K or $10K on something that you've wanted to do, but couldn't, well, go do that.

And now a negative: Pay attention to your marriage. As others have said, spend time with your kids, but don't forget your marriage. Bluntly, your wife can now afford to divorce you. Do your best to see that she never wants to.


Congratulations! This is a blessing, not a burden. You are not "average." You saw something in this business that made you want to work there, you took stock and held it, and it paid off. Some luck, sure, but also good business sense. You're also good with money, not average. How many 43 year old's do you know that have a house and two cars that are paid for? Nothing average there. Focus on you and your family, not on the money. Take this opportunity to teach your children about money and giving, go back to school, or follow that passion you've always had.

     As far as what to do now, find a good family attorney, you now need a will!  He or she can also help with the money.  I think putting it in a 6 month CD so you can take time to think about your future is a great idea.  That way, when everyone comes to you for a loan, and they will, you can say, sorry, the money is all tied up now.  Take some of the money and enjoy it.  Go on a nice family vacation, buy that new car you always wanted, donate to your church, the Salvation Army, Red Cross, or your neighbor who is down on his luck and needs some help.  In the interim, keep the simple life you have, keep working, and feel good about yourself.  You don't seem average to me, I think you're a very smart guy.  Congratulations again, and good luck!  Tom.


Great advice here to not to do anything rash, keep your current lifestyle with some modest splurges for your family.

I would advise you, after a waiting and thinking period, to diversify investments instead of maximizing return. Something people don’t think about is buying inexpensive income properties, small houses and condos. If the US dollar ever loses a lot of its value, then having about 30% of your assets in income producing property will make a dollar crash a little less painful to your family.


There's a lot of good info in here so I won't repeat. I will say congratulations, and the fact your reaction is to freak out instead of party like it's 1999 seems like you're in a good start already. Take some time to read the advice here and do the "right thing" for you.

My only other input would be to take some percent of it and use it for some cause you find worthwhile, whether it be a lump sum anonymous gift or payments over years, or getting involved with your time.


Noone mentions a vital fact: you want a fiduciary advisor, everyone else will fleece you. They are mandated to have your best interest in mind unlike financial advisors and such.


Hire a financial adviser - ask friends or relatives with similar net worth about their advisers. A good adviser can give you peace of mind, and help you avoid an awful lot of undesirable scenario's. I would suggest a fee-based adviser with fiduciary responsibility. That person will have a vested interest in preserving and growing your wealth, since their fee is a portion of that growth. Also, congratulations! Celebrate with your family and don't buy any lambos.


I don't have guidance for you, my friend.

But I do have a question and maybe it would help you.

Had you ever thought about what came after work, before you had the windfall? Like, what you might do if you could retire?

I have worked full time since school, without many breaks. When I've had a few breaks in between / unemployment, the first few times were scary and depressing. The third time it happened, I saw it as an opportunity to take a rest, sit back and think a little, and then find a new pursuit, maybe even my own business and started planning for how to do that.

If you are like me and didn't have a lot of gaps in your working life, it might be shocking to be able to have a break. What I found was that if I put myself into the right mentality... to let myself have a break without guilt (6 months or so - like a sabbatical), to let myself think, and then to slowly build up action to the next thing, it worked out.

That said, normalcy seems to help people. Maybe keeping your routine without the worry about having to pay the bills could be refreshing, if you can frame it the right way.

I wish you all the best. I'd like to dream someday I might be you, but then again, the struggle has always been to find happiness where you are now, money or not. I think maybe that never changes.

Best!


a) Find a financial advisor who takes a fee rather than a portion of your investment. (And/or talk to multiple of the "free" advisors at Schwab/Vanguard, etc.) Get the money working for you. Just be aware that there's (probably) a recession coming soon, so you want to make sure you're very strongly diversified - probably go heavy on bonds, cash. (Get their take on it. IANAFA.)

b) Are you worried about going (stir/)crazy if you retire? Put it this way - you're not going to be reincarnated, and you're not going to spend eternity playing harps. You've got 20 to 40 years left on the planet (i.e. between 7.3k and 14.6k days,) depending on how well you've been taking care of yourself, and you're only going to be truly fit for about half of that, barring misfortune. Your forties and early fifties are your remaining chance to do anything reasonably energetic outside the norm. Spending them in an office working on meaningless products for somebody else would be a waste.

Don't freak out it if you don't yet have any ideas about what you would do. Keep working for at least 6 months. In the meantime both you and your wife should come up with "dream lists" / "bucket lists" - 100 items each -- things you want to do (anything from places to travel, skills or subjects to learn, books to read, things to create, experiences to try, etc) before you kick it. It'll take a while if you haven't done this before. Don't compare lists until you both have them. After you both have lists, read through them together. If you're not convinced about any, strike them and replace them. Prioritize them. Start doing them. Quit work once you get into it sufficiently. Enjoy life & freedom.


A couple of similar questions on HN from a few years back:

- "Ask HN: Steady 4-5% on $5 million?" https://news.ycombinator.com/item?id=1108163

- "Ask HN: Just cashed out for 2M. What now?" https://news.ycombinator.com/item?id=486755


> I do not think I have any real hobbies.

Serious question - why not? If because of a lack of time or money, that problem is now solved. You have enough money to retire. You have the resources to sit down and get good at whatever you want. Which means that 43 is not to late to start a hobby.

Just as an example, since moving to Utah a few years ago, I switched my hobbies around, and they built into a whole new way that I spend my non-working time. I take my kids out on 'adventures', going out into the mountains and the desert, taking photos, coming back and painting landscapes based on my photos. I also collect rocks and gems from my trips, make jewelry out of them, and just picked up woodworking and am building furniture with inlays using those same stones.

It is possible that by trying a few new things, you'll also come up with a whole collection of things to do. So I recommend spending time exploring all your options. Get out, do things, explore, and talk to a variety of people. While the feedback you'll get from HN certainly will have merit, this is a very small slice of the world. Ask these questions to a broader audience as well.


Hire a fiduciary management firm at 0.5% of invested assets per year--fee, not commission--to pay you 2.5% per year. This will likely last you forever, and then your heirs will get it, so also draw up a will and keep it current. Your annual income, inflation adjusted, will be about $200k, and probably increasing more often than decreasing. That's enough for some comfort and occasional luxury, but not very significant lifestyle change. Don't trade up unless you find that you can't spend everything your fiduciary firm is dumping into your account every month.

Keep working, but know now that you have "f-you money", and don't take crap from anyone. Don't retire until you can come up with a hobby that will occupy you for at least 4 hours per day, and your kids each have bachelor's degrees (if they want them) and their own place to live.

Now you can afford a nice, new car every two years. Make sure you do it, to support the used market for the rest of us.

Treat your spouse right, to avoid divorce--or even threat of divorce--at all costs. So buy your spouse's new car first.


Take the time to get one or more really, really good references to true, professional investment management services. (Not showy and "expensive", but good -- not "cheap", either, but real value for the real money you spend. This can be hard to determine, if you don't already have connections. And it can build on personal relationships; however, those can cut both ways, so be cautious.)

You want safe, diversified portfolio. You may be a bit challenged, near the end of the year, trying to position to manage tax exposure. But overall, be thinking long-term, not short-term.

Add to your daily, weekly, monthly schedule, time and resources for learning investment management. You don't have to do it all at once and overwhelm yourself. First, get safe. Then, learn, so that you can speak with and interact with your advisors from a knowledgeable position. You'll come to know what investments you're comfortable with, and what not. You may well also get better service from them, as a result. The good ones appreciate well-informed clients; they may even enjoy talking with you, on a personal level but also to the extent you have knowledge of and insight into your industry/segment that they may be interested in (not confidential knowledge).

This is what I know not from having large assets, myself, but from observing and speaking with a family member who does.

The professionals really do help, but he's also had to bring his own considerable knowledge and smarts to the table and sometimes override their advice. It's really more of a partnership, than one side or the other calling all the shots. If the people you are working with don't have this perspective (especially once they get to know and hopefully respect you), you may be working with the wrong people.


According to one survey many rich people who lose most of their wealth have two causes (1) divorce (2) bad investments advice.

The 1st comes not only for lifestyle changes but also the fact that your spouse may realize she can easily just live by her/himself in case a severe disagreement occurs and hence there are less chances of negotiations and moving on.

The 2nd happens because money managers, wealth advisors are going to swarm you. All your friends and their uncles are suddenly going to have once in life time gold plated locked in deals.

So my advice would be to keep life simple, don’t advertise your wealth and don’t rely on managing your wealth anyone but yourself. Remember Warren Buffet stayed in same house and didn’t even told his family even when he became one of the richest person. Study all your investment options intimately, think of it as your new job. Avoid investing more than 5% of your wealth in any single option that is not backed by government guarantees directly. Make friends with other people with similar networth and learn from them.


Don’t donate it. That would be rash. You can always donate down the line once you’ve wrapped your mind around it.

Depending on your lifestyle you should be able to basically retire. A decent rule of thumb is 4% (maybe less) income on conservative investments, so that should get you around $300,000/year in income if you just take a deep breath and learn the basics.

Lots of advice on this thread is good, definitely put it somewhere safe and get your bearings.

Also, this windfall means your kids can graduate college with no student loan debt, that’s worth something.

Definitely be chill, read all the advice, do basically nothing, read all the advice again, and start to figure out what matters to you. How do you want to live your life for the next couple of decades?

And what does your wife want? That matters, I imagine.

Edit: the implied assumption of this and many other posts here is “don’t spend your capital.” Start there. Preserve that 8million, never spend (including donate) any of it. Use it to make interest in a conservative manner which you can spend as you like. (Including donating to the needy)


Invest in the safest assets that you can think of.

If they pay 3% interest, you have a $240k salary for the rest of your life. 3% is a conservative estimate


  start anon profit put in all moneis.
put it in 7%to10% gariantead no loss always up not annuity only goes up not down.

start at 8miil then reinvest the 8ook interest less 80k salary +320k to charities

         that gets 8,400,000
         then        840k -(80ksalary+380kdonate)
         then      8,780,000
         then       878,000
         then     9,658,000
         then      965,800 965,800-(80ksalary+442,900donate)
                   +442900 
        then     10,100,900

            when you get to 11,000,000
    increase salary to 100k.
            always 1/2 back in 1/2 to donate.
    when you get to 15,000,000 increase salary to225k
       always donate 1/2 back before you take out salary and donation.
         Cap salary at375k,

 donate to shrine's,st Jude, wounded warrior make wish  proportionately.

         there will be some compounding yearly.
         in 20 years surprise.
                          " GOD BLESS"


My suggestion would be to set aside a reasonable amount of money to be able to continue a normal lifestyle if something should ever occur and then try to figure out how you can habe the most positive impact in the world.

There is a movement called effective altruism (EA) which specializes on the topic of how to do the most good with the resources you have. For example, there ks the website 80000hours.org which does research into the worlds most pressing problems and how you can use your career to solve them.

For me, the most interesting thing about EA is that it combines a challenge to develop yourself with a meaningful goal and a supportive community to help you along. You could certainly contact 80000hours to get personalized recommendations if you tell them you have say 7m available. Other organizations which may be interesting to you are: givingwhatwecan.org; founderspledge.org; or more generally effectivealtruism.org.

You could also ask more specific questions here and I will see what I can do for you :)


Pump as much as you can into your retirement savings, where i live this has the highest return and makes sure whatever happens later, you are covered. I would also aim for low-risk/low-return saving fonds for your kids. Needless to say, retire and find something fulfilling to do with your remaining days. Like many other say, enjoy times with your kids.


You've got lots of good advice here, but much of it seems rather boring, and you seem like someone searching for the fire within.

So, here you go:

Step 1) Forget you have any money at all.

Step 2) Withdraw $5000 in cash and buy a plane ticket to Pattaya. Bring only a backpack. Get a room for $15 a night. Budget about $15 a day for food, $10 a day for a motorbike, and perhaps another $20 discretionary. Your total burn rate is $60 day. One more thing -- leave your computer at home. Now that you're a multimillionaire, you can actually afford this.

Step 3) Live your life. Find things that attract you or repulse you, and make decisions around that. Maybe you hate Pattaya! No problem, take the train north to Chiang Mai, or if you feel like a true hippy, try Pai. Keep a journal if you want. Send emails from hostels, and crash there if you need.

You'll return with a new appreciation for yourself, and the world around you, and material things like a shiny new car, or a mcmansion will seem a lot more boring.


I'm not sure the wife and kids will like this, unless you suggest they go along for the ride?


You can change the world :)

And you can do it anonymously at your own pace.

I'd invest in the climate, most importantly alternatives for plastic waste and meat.


You realise you are suggesting to somebody to put their money into high risk investments that might completely crash before they can earn him any reward right?

This guy just won the startup lottery. He needs to invest in low-risk and assets, not in phylantropic issues. 8 million is not enough to start thinking in that direction.


Now that you're sort of free from the constraints of a normal 9 to 5, perhaps it's a good time to consider doing jobs that you might have not considered before. A lot of very skilled friends who've retired from industry ended up doing non-profit work and found it very satisfying. From my own experience, as an engineer still working, my time spent as a volunteer are among the things that gives me the most satisfaction. I'm about as satisfied at having run marathons, been part of an IPO, done some good engineering work, and literally put 200+ roofs over people's heads as a roofer for Habitat for Humanity. Mentoring high school students from East Palo Alto and seeing them graduate and becoming the first college students in their family are among the works I've found most worthwhile. Non-profits often need the type of specialized skills people like you can bring but can't afford.


Large sums of money gives you freedom. Don't like your job? Quit and hold out until you find your ideal job. Don't want to work? Retire! Want to travel? Now you can!

If you are happy in your life, you don't have to change anything just because you have a lot of money in your bank account.

I'd recommend considering three things:

1. Try helping people with your money. Start small - pay for someones groceries at checkout, pay a small medical bill for someone that needs it (checkout watsi). I find helping people very rewarding and you might decide it's something you want to start doing.

2. Travel. Traveling can give you perspective on life that can help you figure out what is important in your life.

3. Park your money in real-estate that produces income. Your money will grow with the increasing real-estate value and also provide you with income to live on. So your $8M grows slowly, you have money to live on and you aren't slowly draining your bank account.


Take a vacation with the kids, just a few days, then go alone with your wife. Do no stop working as "work ennobles man", just figure out what you like first. And yes, hire someone to figure out how to secure your money.

I, like many others, could use some money right now. Why don't you give some money to the best pitch you receive?


Do what Warren Buffet says:

Buffett specifically recommends them as a way to boost retirement savings. "Consistently buy an S&P 500 low-cost index fund," he told CNBC's On The Money. "I think it's the thing that makes the most sense practically all of the time."

Most likely in the long term a hedge fund is not going to beat it.


1. Don't start spending. 2. Get a part-time normal job, at least until you figure out a meaningful way to spend your time. 3. Help people who have nothing and face a crisis. $1k could completely change someone's life or it could give you a tiny bit of fun.

The last point goes for all of us earning more than enough to pay the bills.


These links will give you everything you need to know about what to do with the money.

http://www.modernluxury.com/san-francisco/story/the-best-inv...

https://www.betterment.com/

https://www.adviceperiod.com/

http://www.amazon.com/Random-Walk-Down-Wall-Street-ebook/dp/...

http://www.transparentinvesting.com/uploads/wholestory.pdf


First of all, avoid losing it. From what I've read, bad business deals and shady investment managers are the easiest way to lose money. It will be easy to think, at some point "I'm an engineer, I'm smart, I can do this investing thing"

Nope. Index funds are your friend, with reputable institutions, covered by some kind of fraud insurance or regulation. (I don't know how the latter works in your area, but see how your money is protected)

Let's say there is a market crash and you lose 30%. You're still set for life, and it will come back as the market grows. But bad deals, fradulent advisors: they can take 100%.

Do nothing fast, and avoid telling people you have money. Your life sounds nice, this will help you avoid changing that. You have plenty of time, and a wonderful gift that will make the rest of your and your family's life more comfortable :)


Get 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.


In windfall cases, people tend to change their lives - which ultimately is for the worse. Several people have said the right thing: do nothing.

Keep working, but now spend time thinking about you and yours - rather than your career and the struggle. Invest the money temporarily in fixed-income returning vehicles; we're talking about TBills/Bonds/GICs (depends on your country). Remember, if you're post-tax, sitting on $8M, then an extremely conservative 2% means you're looking at $160K for the year you're learning and thinking. Yes, this isn't a good return, or even long-term. But you're ensuring that your money starts to work for you, while you work on it - all without having any pressure whatsoever.

You absolutely should not make long-term decisions when you're in a short-term state.


There's nothing to freak out about, you hit the jackpot. First of all I would say head to bogleheads and educate yourself a bit on investing and personal finance.

This is not financial advice, but if it was me I'd personally just live off the interest and spend the rest of my days doing what I enjoy.


The best advice you can get is to guard the money from yourself. It's very easy to 'invest it' in crappy ventures. Seek financial advice but spend some time learning how to properly manage it.

Also, the moment people know about your money they will want to get to it, legally or illegally. Best to be quiet about it.

It's very very common for people that get lots of money to lose it eventually. Make sure that does not happen to you.

8mil is enough money for you and your family to have a very comfortable life. Don't get greedy and try to increase it and end up losing it. Put it in a safe investment for at least a year while you learn how to manage it. These days you can get over 2% in a certificate account. After taxes you'll keep 4 to 5 mil so you can get 80k+ for the year.

But remember, try very hard not to lose it!


You sound similar to my family :) People keep asking us why we're not living in a big house or driving big cars. Why would I, I don't need it?

First, get financial advice. You want to make sure that you've got a pot for your kids and enough set aside that you don't have to work.

Then have a look at what you want to do. What makes you happy? I'm freelancing; this year I worked half a year because I don't need the money. Spent the last week building a "food forest" at our local primary school, it was the most fun I've had in years.

Personally I'd put at least some of my money towards combating climate change; but I see that as an investment in the future of my kids (and hopefully grandchildren). I also would not stop working; I would just work less and on my own terms.


1. Sell!

2. Read "Rich Dad, Poor Dad" https://www.amazon.com/s/ref=nb_sb_noss?url=search-alias%3Ds...


Talk about this with someone you trust (wife, kids if they're old enough, brother and/or sister, best friend...). Talking with people you don't know is nice, but if you're anxious you need to have an open conversation with someone who has known you for a long time.

For financial advice i can't help you, though i can give you advice for travels, especially if you don't particulary ike visiting cities: pick a place, then pick something (a hobby) you can learn within two weeks at this place. I've learn skydiving, kitesurfing, and i've improved my windsurf and kayak skills this past two years, and it was much more enkoyable than siviting museums/bars and so on. Also i got back in shape a little, so there is that too.


I'm like you, without the $8M and have an additional kid.

I'm also a financial advisor with a tech startup.

It's just money. Money doesn't do anything, so don't love it. However, your responsibilities with it just rose far beyond what you were prepared to handle. Take your time and find a professional. If you want to learn to do it yourself, find a professional who will teach you.

The job produced the money, but there is still work to do as a man. So plan to work. Work is hard, but work is where the meaning lies, not the money that the job pays. Is also important for your kids that they see you work.

You have reason to be concerned. Many would stop working altogether. I've seen it over and over. They end up with all the vices.

Plan to work. If you like what you're doing, keep doing it.


I think this is good advice for a lot of people, maybe including the OP. Sadly, some people will never be prepared to "unplug from the Matrix". They wouldn't be able to handle the unlimited freedom and time without turning to vices. Especially if they've had their soul crushed by 20 years of a career and responsibilities, and they've forgotten all of their hobbies and interests. I'm not being sarcastic, I think this might actually be true for most people.

This advice doesn't really apply if you are any of the following: young, creative, already self-employed, an entrepreneur, or you don't care if people say that you're "not a man".

I've been freelancing for many years, so I feel like I already have one foot in the door. I'd much rather have a lot of free time to work on my own projects and hobbies, especially the ones that will never make any money. Even 5-10 hours per week on freelance work is really annoying (because of context switching), and I'd much rather be doing my own thing.


Yep, different people/situations should get different advice.


I don't know what you should do, but I can tell you what I would do. The goal being to spend more time with my family.

First thing I would do is split the money into different accounts and banks because it is not insured over 250k per bank + category

Then I would put a large chunk in stocks of big companies I personally heard of and think will last.

I would buy a few gold bars and a safe and bury the safe, and pour cement over it. Probably not the best advice, but the wannabe-spy in me thinks this would be fun.

Basically I would lock myself out of large chunks of the money for the future, while trying to resist inflation, and continue living.

I would take my family on trips, and spend time exploring my creative side. Maybe even creating something that could turn into a business.


You have a life-changing amount of money. I’d take this opportunity to educate yourself on the possibilities now open to you.

1. Take a million of that and move to a nice European city. You can buy a literal mansion in somewhere like Berlin, Warsaw, Prague, Lisbon, Vienna. Comparatively, a million bucks will get you an average normal house in SF or NYC.

2. Take a million and put it toward your children's future education. Consider enrolling them in a better school and/or hiring private tutors.

3. What did you want to do as a child? Be an architect? Design video games? Whatever it is, you can now afford it. I highly suggest really taking the time to introspect and figure out what is meaningful to you in life.


> You can buy a literal mansion in somewhere like Berlin

this way you will burn your money very quickly - for example, you will pay about 10-12% on top of the real estate price just for legal help and taxes plus you will pay a substantial amount every month (taxes plus regional infrastructure improvements). I would rather rent a very cozy apartment somewhere in the middle of Vienna or Munich.


a million dollars will barely buy you an average home in NYC - unless of course you call a 700sft 1 bedroom average.


A million will get you an average little house in a non-sexy part of Queens.


Do NOT hire a personal wealth manager at the moment. We are at the top of the bubble.

Tax planning is important. A small family office might be a good solution for you to help handle the burdens that come along with this money.

Make sure you google "multi-family office" in your area and then google their name and that they have north of $500m AUM.

Google "[name of family office] AUM" to get that figure.

As it relates to investments, you can either buy good cap-rate multi-family properties or do some hard money lending. Look for an area where you can purchase a multi-family performing property at a 10-cap or higher. These will survive the next downturn well and help you generate asset-backed income that is safe.


I recently went through a major liquidity event myself a few months ago (Wombat Security Technologies). Here are some things my wife and I have done:

- Get a financial advisor. Make sure that they have fiduciary responsibility, that their job is to help you, rather than just fees. Talk to several different ones and find one that you're comfortable with. Note that you will eventually have to spend a fair amount of time learning about all the different kinds of investments that are out there. One surprise for me: I already knew about diversifying your portfolio, but had previously only heard about doing that based on assets. It's also useful to diversify over time too, that is slowly add more investments over time, rather than doing it all at once (since that's timing the market, and you might get lucky, and you might not).

- Get an accountant. You will absolutely need one to handle the taxes.

- Read up on Qualified Small Business Stock. If your company and length of your stock ownership qualify, it could be a quite large benefit for you regarding taxes.

- Set up a Donor Advised Fund. Ok, it's probably too late if you already got the money in the bank, but this would let you donate the stock in a way that would save you a lot on taxes, and allow you to direct money to charities you and your family care about.

- Get this book: Silver Spoon Kids. Our financial advisor got this for us, and I found it incredibly helpful as to how to talk to kids about money, especially to make sure that they don't end messed up. This can be quite common among financially well-off folks.

- Set up a last will and testament. This should be done after you have kids. It's no longer just about you, you have your kids to think about, and what happens if both parents meet an untimely end. You will want a probate lawyer to go through this process.

- Max out your insurance, ie auto, home, etc. People with money can sometimes be targets for lawsuits, for a variety of reasons. Maxing out insurance will help with a lot of things.

- Also echoing a lot of the previous advice, take things slow. Don't make any rush judgements or investments. Time is on your side, and besides taxes, there's no rush here. The interest you would get from just a money market fund will be ridiculous.

Also, the big surprise for me? Well, as you can see above, managing a windfall is actually a lot of work. But think of it as an upfront investment, to make sure that things go more smoothly later on.

Good luck!


Following up on my own comment, a lot of folks are saying, don't get a financial advisor. My wife and I discussed this quite a bit, and I was also lucky to be able to ask a lot of questions to my brother, who previously did a lot of work in hedge funds and has managed his own portfolio for decades.

It's a perfectly fine strategy to manage things yourself, as long as you diversify. Be sure to get things that are non-correlated with the market, and diversify over time.

The thing that a lot of people are missing in their "don't get a financial advisor" advice is access. Access to hedge funds, access to some investment vehicles designed to hedge your bets, access to early stage funding of companies. These are things that you would not get easy access to without a good financial advisor.

Again, you can do perfectly fine managing things yourself, so it's basically a judgement call here.


I've seen good financial advice in the comments. Other than that you now have more value of answering the question: if money would not be an objection what would you do?

In my case: I'd be learning more things, helping more people in ways that makes me feel good but are still productive. I'd also do more things that I'd find fun. I'd still enforce a relatively strict rhythm because I know what happens when you lose that.

I might become a musician and go all out with that.

If you never had an urge or yearning to do anything else than your life right now, then why change it? Live the life you want to live and try to stay sensible / use common sense.


Do nothing for a year. Put it in treasuries, minus 5%. You can do this yourself.

You need to come to terms with having money, and that just takes time. Go through all the seasons, all the birthdays, holidays, etc, while doing most everything the same.


Not been in your position, but what truly spoke to me was the book by Elizabeth Dunn and Michael Norton, titled:

Happy Money: The Science of Smarter Spending

In short: The key lies in adhering to five key principles: Buy Experiences (research shows that material purchases are less satisfying than vacations or concerts); Make it a Treat (limiting access to our favorite things will make us keep appreciating them); Buy Time (focusing on time over money yields wiser purchases); Pay Now, Consume Later (delayed consumption leads to increased enjoyment); and Invest in Others (spending money on other people makes us happier than spending it on ourselves).


I wrote this comprehensive guide that sums up what I’ve learned in the years since I found myself having to solve this (awesome) problem: https://medium.com/@michaelflaxman/how-to-preserve-and-grow-...

In your specific case, I’d consider investing a small chunk of the proceeds in a qualified opportunity zone fund. The tax incentives are massive, but there are a lot tradeoffs that you’re unfortunately probably not in the best place to fully work through right now :(


When I retired I went through a process of reverse engineering my life...basically creating a dialog between the factors that I thought contributed to life satisfaction and how I rated different jobs, hobbies, projects, etc that I had been involved in. The objective was to see if my story correlated. (Hint, it didn't.) Once I had a list of more-or-less verified factors, now verified, I then listed all things I imagined that I might do next and evaluated them on those criteria. I picked the three that ranked the best and started exploring. 5 years in, this seems to have worked well.


Buy a boat, get a boat guy. Whatever makes you happy. Live the life you wanted... for a bit.

Life is too short not to enjoy the few successes you will get. Put away a million or two and then enjoy.

Live a little, people die a lot.

Everyone here wants to make it sound as if 'it is not enough'. Screw that. 8M puts you in an elite group, even here on HN. So most of these people here are giving you advice with zero experience of your situation. As long as you have a safety net or even a fallback to your normal/previous life, enjoy it the best way you can.

After all, despite what we may all claim, a good part of why we do what we do is for the money.

Congrats!


Like the saying goes, if you want to get rich:

1. No 3rd house

2. No 2nd wife

3. No 1st yacht

Yayy, now that you made it you can get all of the above!!


Use the $$ as a sustain buffer to allow you live your comfortable life till the end of your days.

1. Do not sit there with your hands idle.

2. Start a business. Go talk with your friends, and friends of friends. Go talk to business owners who are friends of your friends and their friends. Find a business which needs something improved. Investigate how many more businesses have this problem. Figure out whether they will buy your future solution (do sales), and figure out how to help most of them in the least time.

There now you have a product idea going. Using your $$ to pay for your living, get to work.


"Start a business."

Um, he has no need to work. Why would starting a business be the most important thing to do?

Basically, he can find out what sensible or quirky thing he likes and do that - just as long as it does not cost more than a middle class income can support. If he's entrepreneurial then sure, business.

But I see nothing wrong in spending ones life painting, sculpting, doing maths or science or volunteering and charity or whatnot. Or just spending time with the family (if that's something he enjoys). Just as long as it's something he enjoys and finds worthwhile.


>Um, he has no need to work. Why would starting a business be the most important thing to do?

When you're financially independent you have the freedom to pursue ideas that are more risk-averse. It's when you have the freedom to do things that you wouldn't have felt comfortable doing when you were worried about paying your personal bills each month like me, like my fellow peasants.

>just as long as it does not cost more than a middle class income can support.

Uh, his 4% safe-withdrawal-rate is 320k, if he wants to be cautious a 3% safe-withdrawal-rate is 240k. That's quite a bit higher than middle-class income (median HOUSEHOLD income in the country is 59k).


"It's when you have the freedom to do things that you wouldn't have felt comfortable doing when you were worried about paying your personal bills each month like me, like my fellow peasants."

I completely agree, but we have no way to know what the best way for him would be to use his new freedom for self -actualization. There are lots of other interesting things to do in life as well.

"That's quite a bit higher than middle-class income."

Sure, but it's not still an insane amount of money. Before one gets the hang of finances it's better to think in purely middle-class (or upper middle class) financial terms. There are lots of ways to spend 8M fairly quickly.


>There are lots of ways to spend 8M fairly quickly.

There's a lot of ways to spend 8 billion fairly quickly. That doesn't mean that either isn't an obscene amount of money to many people (it's 250x~ my gross income).

Sure, he could go buy a jet and a manse and be broke in a week, but I could legitimately burn through 8 billion dollars fairly sensibly in several months throwing it at serious projects. Hell, I could burn through 8 trillion in probably 3-5 years pursuing society-changing projects.

It may not be a lot of money to tech/bay area types but to the rest of the world it's more money than the vast majority will see in multiple lifetimes.


This is getting very off topic, but.. Um... what would you actually spend 2 trillion a year on for four years on to implement a change in society?

I mean sure, it's roughly the size of the oil market so theoretically you could buy all the oil in the world for 4 years and just not use it, thus forcing everyone on a massive pace to post-oil economy.

But there's a huge hysteresis in how the society works, at such a massive scale, it's not sufficient to have the capital available, you also likely need a competent and willing organization to fulfill your goals, political co-operation from the major global players and most of all, for any of it to matter at all, you need to create a change that

a) lasts

b) changes things for the better

For example of moonshot ideas, I presume you could buy Space X and bankroll an entire series of Mars expeditions, but if you failed to create a sustainable economy and culture around your project it would ultimately be forgotten once the money runs out.

Of course, if you dump thousands of peoples on Mars, maybe other financial operators would take over.

I don't know if ending oil economy or colonizing Mars were the projects you had in mind, though.

Seriosly, if someone gave you 8 trillion... what would you do?


8 trillion is nothing on the scale of the Earth, right? I don’t know if I could fix Sierra Leone with 8 trillion but I could try. I imagine setting up a new safe free land in Africa that can take advantage of all its natural resources and people so they can be successful. Replicate it to the rest of the continent.

Maybe a moon base but that’s not cash-limited above a few hundred billion, I think. I might run out of rocket scientists and habitat specialists before running out of money.


That’s about enough to fund Sierra Leone’s foreign aid for a couple of millennia.


But that keeps them at where they are now. Imagine making them a Japan. What would that take?


"What would that take?"

The quality of primary education in sub-saharan Africa is abysmal compared to the developed world, Sierra Leone included.

I don't know what else is wrong, but not having an educated population is an obvious hindrance towards japanization.

To fix that, you'd probably need to:

* Create a system for teacher education * Instill a sense of vocational pride in teachers

The most critical part in educational outcomes is often the fact how much the surrounding culture values education. To support the improved infrastructure and operators in primary education an education positive sentiment should be instilled using various public education campaigns, including advertising and using popular media such as TV shows to proactively affect public opinion.

Soap operas (or equivalent popular entertainment) are a really powerful tool to instill cultural shift if you can get all stakeholders to co-operate.

After education is fixed someone should probably invest capital in some industry that can create jobs and wealth. I don't know Sierra Leone so I don't know what that is.

If they have lots of natural resources then a land reform where the ownership is divided among many smallholders often is a great way to distribute and create national wealth. It can also backfire badly if you don't know what you are doing (like in Zimbabwe).


>but.. Um... what would you actually spend 2 trillion a year on for four years on to implement a change in society?

First I'd set some milestones for private rocket companies to hit that had funding payouts, think x-prize but considerably more money and tiered. I want to see something like BFR operational ASAP. In this scenario I'd actually try and 40% or so of SpaceX which would chew up 10 billion or more at their most recent valuation, this would allow for hiring more employees and getting more production capacity online. I absolutely one all of our eggs out of one basket, to do this we need to start having humans on other bodies to start seeing if living at reduced gravity is viable long term without genetic modification.

I'd do similar for the current companies that have expressed interesting in asteroid mining, on a smaller scale to encourage them to develop spacecraft initially testing ideas for tackling the problem. While mining asteroids isn't going to be economically viable for export to earth (although I think if we could drastically reduce the cost of rare earths and precious metals, we may spawn new technologies. Rare earths and precious metals may also be important for grid storage and renewable energy at greater quantities than are easily accessible on earth) but would allow for cheap construction in space as well as cheap fuel in space. Once we could figure out how to pull stuff off of asteroids, we could work on manufacturing technologies for microgravity.

I'd assemble several missions to Venus, the Moon and Mars. I'd send several identical communication relays to Mars and place some around the Moon for relaying data for both current and future missions to both bodies, I'd send several identical orbital reconnaissance satellites to all three bodies.

I would work with local governemnts to re-establish kelp and seaweed in coastal regions. This helsp reduce ocean acidification, provides safety for various marine species, helps to sequester some carbon dioxide and is a farmable crop.

I would work on deploying PV panels on roofs of public buildings. Think schools, government buildings, libraries distributed across the US to show people that PV doesn't need to be ugly and to considerably help distribute some power generation across the grid.

There's also a few people working on carbon sequestration I'd like to throw money at, but the amounts would be insignificant compared to a trillion plus.

This would easily chew up 1 trillion plus in 1-3 years just buying materials and paying wages.

I've ideas for many other sectors and avenues too but this gives you some idea that I could legitimately spend that amount of money. Some of it would be funding crazy research, some would be helping companies to expand current production capacity, a lot of it would be x-prize style stuff "hit a notable milestone, get more money".

I'd like to throw money at:

- understanding memory/the brain with the ultimate goal of backing up a brain

- exploring some fringe science for anything remotely valid

- find a use for our nuclear waste, so throw some money at companies like Oklo

- energy efficiency

- permaculture

- greenhouse growing to reduce all this importing and exporting of food all over the world. The US imports 40% of it's fruit, exports 40% of it's corn and similar percentages of other grain etc. Purely from a fuel standpoint this is baaaaad for the environment.

- encourage local manufacturing, I currently work in international freight and from publicly published numbers about our aviation jet fuel use it's mind-blowing how much carbon just my company produces each year.

- encourage more sustainable technology, socketed/modular upgrades for phones and computers

Etc


I absolutely *want all of our eggs out of one basket.

Hadn't had my coffee yet heh.


Idle hands are the devil's workshop. Having no passion and nothing to do is a sure way to lose everything and ruin your otherwise established life. So better to get to work on your own project now without the fear of going broke.

Painting and sculpting, science or volunteering are fine if the person loves it. Otherwise he'll be happy doing what he's been doing all his life before this moment — programming, creating his own project.


As someone who's pretty idle, the worst (and only bad) part is everybody telling you how something must be wrong. Like people can get outright hostile and say pretty mean things. Everybody's completely fine with you not doing much, but if you actually say you're not doing anything instead of coming up with a random answer they go nuts!

Which I must admit I enjoy in a weird way.


Don't listen to me. If you still reading I can only say what I would do. I am roughly same age and positon as you without the 8M. I work because I love IT but mostly because I have to provide for my family. This money gives you freedom. I would secure it in low risk investment and then do what I love. Right now I am enjoying experimenting with auaponics and hydroponics. I would love to have try my hand at being a farmer but I can't afford to quit my job. You don't mention your hobbies or what you like, that's where I would start.


1) Put aside the majority to be safely invested for your families future. Don't play silly games like thinking of "donating it"... You will likely need it in the future. You had the fortune of stability thus far in life, and this doesn't last nor is it typical. Be a little more realistic here.

2) Devote your time to following your dream and doing what you enjoy doing. is there seriously nothing you always wanted to do but never thought it would be a reasonably paid career? Music? Film? Inventions? A programming side-project?


What kind of hobbies are you potentially into? I'd start there. You could grab an acrylic paint set, a few brushes, a few canvases, and get to work painting. You could buy a guitar or mandolin or cello and play some music. Buy a road bike for a few hundred and hit the bike paths. Learn to make gourmet food or baked goods. There's a LOT of really fun and enriching hobbies that are fairly cheap/middle class and yet, your family would like the baked goods or the paintings of Rufus, your new loveable mutt dog.


Dont take any decision for 6 months to 1 yr,continue working as if you have little money. Dont retire or tell anyone. Let the money as is

For 1 yr decide on what to do next --> it can be anything which you like


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.


>Amazing how many people think $8M

Um. Come check out https://www.reddit.com/r/leanfire/ but make sure you are sitting down and don't have a heart condition.


My view is those people are banking on stock market performance that is influenced by a massive bubble still underway. I think in 3-5 years a bunch of them will regret this decision, as their net worths will have been cut in half or worse. I’m curious what you think about that.


>I think in 3-5 years a bunch of them will regret this decision, as their net worths will have been cut in half or worse. I’m curious what you think about that.

I think you're a panic seller. 3-5 years is nothing.


Yes but if you've been happily spending 4%, which turns into 8% because the market is down 50%, do the math on that.


The % is based on the original amount, inflation adjusted, and yes you absolutely should tighten your belt during down years.

Your argument is given ad nauseam, there's article after article, reddit thread after reddit thread, blog after blog explaining why your concern is a non-issue.


$4M is enough to retire almost anywhere in the world. A conservative withdrawal rate of 3.5% gives you annual investment income of $140,000. Keep in mind that this income is not tied to a specific location, and you don't have to work for it. It's a huge amount of money anywhere outside NYC and SF.

$8M would give you $280k / yr. That's a huge amount of money, and quality of life doesn't increase very much after that.

Also you can be your own boss and work on your projects or hobbies. I think the "financial independence" part is more important than "retirement". Maybe you have a very different idea of "retirement" than me.


what kind of lifestyle you going for where 8M isn't enough?


Are you arguing $8M is not enough to retire on?


Are you in the U.S - meaning your healthcare and that of your loved ones is not provided for, or are you in a country in where it is provided for? Add that evaluation into the other ones here.


Put it in index funds. Do NOT hire anyone to manage your money. You and your family can live off the interest and then provide your children with college tuition. You can donate some now or even more when you pass away due to interest. I would retire and tell no one why, make a plausible "I'm working on a business idea" excuse. Tell no one. Don't tell your kids. Figure out how to tell your wife and don't let your partner or kids "scope creep." Live comfortably.


If 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.


The best advice I’ve ever gotten: https://jlcollinsnh.com/stock-series/


My advice is to head on over to Reddit. /r/personal finance

They have a very well maintained FAQ, and are super helpful. The best thing to do is nothing, until you have asked there.


First off, congrats!

Lots of great advice in this thread that is impossible to beat. But $8M means you can do whatever you want: including nothing. You can do absolutely nothing. Or! change your life. It's up to your personality and how you view money and time. You don't HAVE to work anymore... or you could go work at something that excites you. Or travel the world.

But whatever you do, use it to do some good in this world. Even if that's just being a great father to your kids.


Don’t hire a manager, no. Sell the shares, or most of them. Put 90-180 days of expenses in cash into savings. Put the rest into Vanguard Admiral-class index funds and forget about it. If you end up buying a house, mortgage it like anyone else would and make the payments. You’ll make more paying interest on the house with the money in the Vanguard fund than you would with it just sitting in the house (no interest, but without the parallel investment).


For now, get a new job if a similar sort. Bank the money in several relatively safe places (insured accounts and CD's. Let it sit and earn even trivial interest for the moment. Maintain the same lifestyle. Make no substantial changes for at least a year. You and your wife should have a many heart-to-heart talk about what your ultimate goals in this life and the next are, and how your windfall may or may not help that. Don't rush.


Basically you won the lottery. Please read this thread fully and very carefully, it might literally save your life:

https://www.reddit.com/r/AskReddit/comments/24vo34/whats_the...

You did well so far for publishing this anonymous, so kudos.


1. Buy few flats/houses and rent them out. This way your investment will always go up comparing to saving money in the bank and you'll get consistent income like a salary. 2. Focus on your health, do some sport like jogging or running. Start small and keep increasing it. I'm suggesting this because you didn't mention you're exercising. 3. As everyone else said, spend more time with the family.


> Buy few flats/houses and rent them out. This way your investment will always go up comparing to saving money in the bank and you'll get consistent income like a salary.

It's true that investing in real estate to rent can give you a loss compared to nothing, but I don't think this comment deserved the downvotes it got. This strategy offers a fairly significant psychological advantage. The old principle of staying rich is that you own some kind of wealth that gives you an income, and you spend out of your income. Mortgaging or, even worse, selling your principal is the road to poverty.

The "modern" view of being rich as owning stocks that pay off by experiencing price appreciation makes this idea incoherent. Your entire wealth is principal and you have no income. For an asset that generates rent, or a stock that pays dividends, you have a much clearer conceptual divide between your stock of wealth and the income it generates, and therefore a much simpler idea of what it's OK to spend.

If you don't quite trust yourself with the money, setting up a scheme that allows you to follow a simple bright-line rule of thumb isn't the worst thing in the world.

Don't listen to people who say you should plan to spend the whole thing down so that you've finally drained it to exactly $0 just in time for your own planned death. Hold on to it.


Another amazing information: https://www.iwillteachyoutoberich.com/blog/win-lottery-what-...

Please be conservative and take time to educate yourself about investing / markets. It will take about a year. YOU CANNOT TRANSFER RESPONSIBILITY for this. You need to know how this works.


Learn how to know whether somebody is trustworthy. You will certainly attract a lot of friends who either want your money or will help you spend it. If you don't know how to measure trust, you might well lose a lot.

For most of us, the stakes are low so it is not a primary skill we need but with $8M, you need to know there are people who would ask for it all, promise the world and deliver nothing.


Based on the details you shared, I would use the same advice that's typically given to lottery winners. Speak with a trusted lawyer, then a financial advisor. Set up a low risk, income-generating structure. Once the dust has settled, your family banking is set up, and you have interest payments coming in - only then can you think what's next. Not before.

Congrats, this is a huge achievement.


Congratulations! But you don't need to do anything, do you? 8 million is not a terribly large fortune - although way more than most will see in their lifetime. If you live 50 years, you can use 100 000 of that per year, and still have something left over after a few surprise expenses. That's still middle class existence - except for the burning need to be employed.


Don't think of yourself as having 8M, think of yourself as having 320k/yr (4% rule) with minimal work (managing the money). This will sober up some of the emotional parts.

Also, you are over the threshold to true freedom, so think carefully before doing the 'obvious' things like buying a house or two that will only, in reality, saddle you with obligations.


You see a lot of stories about friendships and family relationships being ruined when people find out and feel entitled to a share.


congrats!!!!!

you did not win the lottery but I keep this link [0] handy in case I every get a windfall it has some gems of good advice and caution.

briefly, I wish I had tour problem and if I can fantasize for a minute.... after paying off all loans/debts and doing a month of two of traveling I would probably take classes in physics and writing while trying to find a way to invest it safely with the goal of more or less keeping the money and growing it only safely and not losing it on foolish investments.

lastly I also keep this comment [1] as a reference for general financial advice.

best of luck!

[0] https://www.reddit.com/r/AskReddit/comments/24vo34/whats_the...

[1] https://news.ycombinator.com/item?id=10114707


Since you have kids, I would recommend putting money into your kids college fund, and make sure not to touch it, no matter what.


So now you see there are two camps of advice:

1) it's all about what to do with the money 2) it's all about you

Rule of thumb in practice is don't take advice from someone who hasn't taken the time to understand more than what you shared. If you ask non-anonymously for advice to a professional with proper standards, you should get questions in response.


First thing you should do is something fun. Second thing you should do is something fun. Third thing you should do is something for someone else. Make that take at least year. Don't spend more than $500k on it. By then you'll know what you want to. Oh, and don't forget to be humbled by how insanely insanely lucky you are.


Buy something nice for yourself, invest the rest. lottery winners have a high bankruptcy rate. I can't find the interview but there was a great one with a janitor that got a similar amount of money. he bought himself a Rolex then invested. A tiny frivolous but incredibly pragmatic overall.

With that amount, hire someone and then find some hobbies.


Philip Greenspun became a millionaire at 37. He wrote about his experience and provided some good advices (IMO): http://philip.greenspun.com/materialism/early-retirement/.

EDIT: Forgot to say - Congratulations!


You should cross post this on /r/personalfinance It's a great community and they have a wiki article on just this https://www.reddit.com/r/personalfinance/wiki/windfall


If there's anything you've ever wanted to do, but felt too stressed out about work to do, this is your chance to think about it more seriously (e.g. living in Europe for a year).

Beyond that, divide it up into a low-risk portfolio and investments that can make passive income. Don't let anyone know you have this newfound wealth.


Help me create nothing at all: https://www.patreon.com/mrtno

Now serious answer: I don't know if it has been translated into English (I don't think so) but two famous French sociologist worked on what happens when normal people win huge prizes at the lotto (for a review, in French: https://journals.openedition.org/lectures/1140)

Many commenters here suggesting not change your lifestyle, and I think they are right. But it won't be possible. Your world is going to change anyway. You are entering a world with many unwritten rules, and it takes time to adapt. Learning the rules will create for sure some malaise.

You can just step into the world of the "rich" without making some faux pas. A new socialization will be necessary. At the same time, you just won't be able to lead a "normal" life as before. Learning how to manage this fortune will likely take your time for a bit.

My advice: don't be hard on yourself if you do something wrong. It will happen for sure.


I've recently started learning about the benefits of passive investing in index funds. I learned a lot from this blog. Maybe you'll find it helpful too: https://jlcollinsnh.com/stock-series/


I don't know if you live in France, but you can: - Create an account in Panama - Going around the city in singing "LaLaLa" Check this guy: https://www.youtube.com/watch?v=cQuCdLzFwag


Realistically 8M (is this after taxes??) is not much money these days. Considering rising health care costs, real estate, college fees (you have 2 kids) this is "nothing".

Example: If you want your kids to be college debt/mortgage free when they grow up (dont give them the money now, rather they have that ability when time comes) - you have 2 kids, figure by the time they are adults average starter condo price in a major city will be 1.5 million? So 3 mil goes towards their mortgage. Another million to pay for education costs/support studies. Oooops 1/2 is gone already. You have 4Mil left - You need 2Mil to retire. Now you have 2Mil left. If you want to buy a place somewhere nice and warm to retire - figure 1Mil to buy a property there and another million to service that house (taxes, repairs etc).

So here 8Mil is gone its simply not much money and is nothing to freak out about. Just sit down and divide it all up towards your long term goals.

and Congrats! Its a big deal to be able to have your kids mortgage/college debt free and be able to have a somewhat worry free retirement.


Lol buying your kids $3 million worth of condos seems more than "nothing".


3million for 2, so 1.5mil each and thats in 10-15-20 years, so think inflation on top of price appreciation.

i dont know where you live but 1million really does not buy anything extravagant these days in a major city hub. just a regular house/condo.


You'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.


Do nothing and retire, find some relaxing job maybe. Don't give away, or start having some "brilliant" investment ideas. Figuring out how to make the things work - taxes, health insurance, diversifying assets for security - will take enough time and effort to figure out.


I would suggest to either get an annuity (is that the correct term in English? Dutch "lijfrente" is what I'm talking about), or put it in safe investment and let it pay interest every month. That way you're certain to have a decent income for the rest of your life.

Now you can either retire early and spend more time with your family, or, if you need something else to do, just get another job. Do volunteer work, become an activist for a cause you care about.

Free yourself from the worry and stress that comes with having to work for a living. You can still work, but do it because you want to, or because it's something you care about.

Paying off your mortgage is always a good idea too.

And you don't have to use any of this money. Feel free to be generous with it to others. Give to important causes, or to the homeless near where you live. Or sit on it. You wouldn't be the first person to turn out to have an unused fortune when you die.

Whatever the case, don't freak out about the money. Use it to free yourself from stress; don't make it a new source of stress.


Definitely don't retire without considering it very carefully. Some people do well with (in your case, very, very) early retirement, but many don't at all. Just because it's possible to retire doesn't mean it's necessarily the sensible thing to do.


Retiring is a funny concept. Just because you can suddenly not work doesn't mean you should rest on your laurels. Work is a way to remain occupied, however it is too prescriptive in nature.

Most people would benefit from a "retirement" that involved continuing occupation but in a wider variety of roles, with greater freedom to chop and change.


I occasionally work with someone who is in a similar situation.

He just continued with his career and the associated stress level. The difference is that he drives a fancy car, and will walk away from a bad job.

I also suspect that he takes 2-8 month "funemployed" stints when he wants a vacation.


Hold on to it and don't tell anyone you have the money: not even relatives, just your wife.

Be very careful when you spend it. There are 2 types of spending in life: Assets and liabilities, learn about this. You want to minimize your liabilities and maximize your assets.


Read the last few chapters of "the simple path to wealth". In a nutshell, invest most of it in a broad index fund and if you can live with 4% of the 8 million, you will not need to work again and you will leave your children more than enough.


One thing you can not go wrong with is learning things. It kindah sux that in general outside of situation like yours you can not really take a break and just learn something new full time in early 40s (if you have family and kids to take care off).


There's some bad stuff coming down the pike in a few decades so use your good fortune to prepare yourself and our family.

Buy a bolthole somewhere that will have a good microclimate/rainfall even as things hot up. You don't need to go all prepper but build some kind of house there and start your integration into the local community, it will be good to have friends. Plant some shade trees. Get some solar, water tanks, etc. Go over capacity so that you can help out others.

Spend time with your kids, that's one thing you can never get back. Travel - slowly and considerately - by yacht, not be jet. Learn about the world first hand. Help them become adaptable and resilient, they're going to need it.

Who knows what the world of work will hold, so think of the money as having to not just see you out but also one or two generation after you. Then it won't look like quite so much, and you'll be able to make wise choices.


What to do if you win the lottery. https://www.iwillteachyoutoberich.com/blog/win-lottery-what-...


Spend some of it, take a vacation, do things you wouldn't otherwise do.

I sold my tech company at age 25 and suddenly had a boat load of money, and instead of doing the above I immediately went on to the next job. It's 10 years later I regret it.


1. Save and plan for the future. You might need a financial planner. Happy to recommend.

2. Find an interesting problem to work on. It is hard to be free and have no goals. Now you have the ability to build your own goals. Dont rush into it, take your time.


Invest it into something stable. If you can get even 2.5% interest on your 8 million, that's $200k. I would think realistically you could get 5%.

You can live on that much, never work again, and still leave a nest egg for your kids' education.


I'd park it until you figure it out. See a lawyer about a will, ask about trusts and stuff, and where to park it safely. Live life like normal for a few months. Give yourself time to figure it out. Nice problem to have, enjoy it!


If this was to happen to me. I would buy stock in long term, low yield investments. Very long term investments with small payments. Similar to a superannuation program or large industry fund. I would take small amount and take a break, somewhere I always wanted. Take the whole family. Replace both cars (if they were needed) to extend their warranties for 7+ years. Place some money aside for college fees for the children (if that’s your things). Keep $100,000 as a “sickness” backup for insurance or even Cancer or some similar expensive cost (if it does cost a lot where you live).

At the end you’ll end up getting back your $8,000,000 but you’ll be getting it 10-20 years when you want to retire and do sweet nothing. Right now your brain still wants to produce and provide. So I doubt you will want to quit working. Maybe you can take a pay cut and do a job you always wanted?


> Should I donate it?

You have time and money. Why would you trust some one else's judgement on how to do good things with your money. Spend your time and money to do good. I think that would be more rewarding than anything you can do anyway.


Buy one or two houses in a nice seaside area, rent them, live all your life with a continuous income and do not spend too much. I would do this if this crappy software project management work I am doing gave me the same money :)


I'd go with 1 brokerage, Index fund most of it, keep 20% cash for misc investments (ethereum). Hire a trustworthy accountant.

It's only money. Now you have some, congratulations. Get back to focusing on the things that matter!


Probably the best thing to do is to set up trusts for your family invested in a broad range of companies across a portfolio. It could help with education of your grandchildren even. You never know when you may need it.


First of all, you don't have to do anything immediately. Don't rush. Take your time, study different options to invest the money. Personally I would put most of it in an index fund with low cost.


Use a fee only investment advisor.

Set up a diversified portfolio so that you don’t ever have to think about your money.

Invest in your relationship with your wife and kids - learn how to become a holistically better person.


Wear sunscreen! https://youtu.be/sTJ7AzBIJoI

Focus on your family and yourself. Do not focus too much on money.


You should figure out how much to put away for whenever a time comes where you need financial freedom it's upon grasp. Money for health emergencies, food, taxes and loved ones.


For Charities, look at www.givewell.net. then, on a vacation, go visit some of them and see for yourself. if this doesn't provide life-changing perspective ---> therapy.


Lots of advice to put your money in the stock market. Have you seen the stock market this year?

Don't get me wrong, the stock market is a perfectly great place to park your money, and it's basically back stopped by the US government.

My suggestion is look to invest elsewhere. Invest in real estate, invest in businesses. The latter, as you now know, can create much more wealth than the stock market.

The end goal of this isn't the money at this point. It's to build and be creative. It's not for everyone. Just my two cents.

EDIT: If you do put your money in the markets - invest in a handful of low cost and well-diversified ETFs. Hiring an advisor could be a good idea - but make sure you know their fees.


This is full of bad or not helpful advice.

> Lots of advice to put your money in the stock market. Have you seen the stock market this year?

Investing a large sum in the stock market like this is not meant to make quick money, it's for the long term. If you invest in funds that follow the S&P500 it's statistically going to bring solid returns over the long term. This will allow you draw a salary from the returns keeping the principle intact.

> Invest in real estate, invest in businesses.

Investing in real estate and businesses should be a small piece or even hobby until you really get a grasp on it. It's an easy way to lose a lot of money.

> The latter, as you now know, can create much more wealth than the stock market.

It can but again great reward = great risk. Angel investing is a full time job in itself and unless you have the right connections with the best companies it's very difficult to do the right deals where the 10x returns happen.

> Hiring an advisor could be a good idea - but make sure you know their fees.

Not just know their fees but make sure it's a fiduciary and not just a broker. A fiduciary advisor is legally obligated to put your best interest first.


Put a large portion on stocks but make sure to sell enough of them each year so that you have enough to live on. When you are close to retirement slowly move everything to bonds.


Take a trip to Jersey (the island) and you will be well taken care of. Another place is Marbella/ Puerto Banus Spain, good place to park money and make some while parked.


Find a purpose - something you can look back on and be proud of. Ask yourself what the best way would be for someone with your skills to help others... then start on it.


I would use 1M (max) to get a new house & car, donate 10%, and put the rest in investment properties (different regions), gold, and some blue chip shares.


And congratulations & good luck with managing the wealth.


Give 10% to the poor and causes you respect, go do a world tour with your family or alone, make a bucket list and fulfill it

The world is your oyster go abuse the opportunity


Get someone to manage it, take a nice, comfortable salary and start enjoying yourself. Out of respect for the rest of us schlubs DO NOT get another job.


Take a little time out to reflect on life before you do anything with it. The money will still be there in a few weeks/months when you’re ready.


Well my personally philosophy is: "the only question in life you need to have an answer for is 'what are you gonna do about it?'"


First of all, congrats. You are in a great situation, now you just have to manage it to allow you to live your life the way you want from here on out.

The very first thing I'd do is watch this video (it's a famous scene from the movie The Gambler). https://www.youtube.com/watch?v=rJjKP8vYjpQ

The basic idea is to establish your "position of 'Fuck You'". You basically have that already... house paid for, cars paid for, etc. Put enough of your money aside in conservative, safe, long-term investments that you'll never be hurting for money. Include things like your kids college tuition or whatever things are important to you. Once you have that, even if you blow the rest of the money on toys, sex, drugs, rock 'n roll, whatever, you always have the ability to say "fuck you" to anybody who hassles you.

Beyond that, you can decide if you want to try and grow your wealth by investing and actively managing your money. Maybe you would want to do some angel investing, who knows? Or maybe you want to engage in some philanthropy. You probably don't have enough money to get a hospital named after you, but you could buy uniforms for the local high-school band group, or donate to a local volunteer fire department, or any number of things.

Should you continue to work? It's up to you... my guess is that if you flat-out retire at your age you'll find yourself bored pretty quickly, but it depends on what kinds of things you choose to engage in. Maybe there are some hobbies that have been latent in the back of your mind, that you would enjoy, but you just never made time to take up. Spend some time exploring things. Think about what you enjoyed as a kid that you gave up as an adult, etc. Or maybe you want to spend some time volunteering - become a volunteer firefighter, or volunteer at an animal shelter, or a soup kitchen, or a homeless shelter or something.

Anyway, it's hard to give somebody else advice on this, because we all have different values and priorities. But I think the "position of fuck you" stuff is pretty universal. Lock that in, and what you do beyond that is up to you, while you always have that as your floor.


Learn how to be a great lead. Or a great coder. Or a great painter. You can take the time to explore all parts of life and figure out your passion.


Yes, yes, and no. Definitely get some (objective) professional money management help. Pick someone the wealthy use like JPMorgan Chase. Take care of your family; buy them houses, cars, and education. Find a charity you care about and don't just give money but get involved. And use some of it to help another startup get started. (I humbly suggest mine, http://mimix.io) But whatever you do, don't retire. How dull would that be? :-) Thanks for sharing your good news.


I highly recommend reading "Early Retirement Extreme" (the book) and http://mrmoneymustache.com/blog/. Check the https://www.bogleheads.org/wiki/ for some simple investing strategies. Or look at "Perpetual Portfolio" for a simple allocation of of 1/4 gold, 1/4 bonds, 1/4 stock, 1/4 cash.


https://jlcollinsnh.com/stock-series/


Try something new. Scuba diving. Sailing. Perhaps you will be passionate about it and want to travel the world to do it. This is your chance.


There is no "should" here! It's your money now, do with it whatever you want :)

Guidance: don't freak out, it's gonna be fine.


Retire or move to a low stress job, teach young people if you enjoy that, spend time with your kids, travel every year.


Wait for a market washout. There may be a big one coming. Then, invest it in stocks that increase their dividend every year. But say don't borrow money, or perform some other kind of financial engineering, to cover their dividend. These are the companies that are making money and are proven winners. Then let the money sit year after year after year. Unless something drastically bad about the company's business has changed.


Go travel my friend! And don't put yourself in the position of subscribing to luxury travel either. You'll be burning through money faster than you realize.

Besides, trying to live truly locally will yield such 'rich' life experience. Nothing like connecting with other cultures and experiences without the emphasis on the balance within your bank account.

Other than that, congrats! That's a nice lump of money and best of luck to you and your family.


Haha, so many salty downvotes in this thread. Relax.


To go against the current a little bit, hold off on investing in the stock market as of now. The market is likely to turn downwards within the next year or two. There are too many indicators pointing to this.

Hold off and wait for the major indexes to lose ~40%-50% in value, then invest. During the 2008 crash, the main indexes and stocks lost ~40%-60%, and treasury bonds ~8%-10%. Save your money now and invest when markets start to bottom out.


I'm not sure this is good advise. If there is one thing that I've heard from experienced people, it is that you can't time the market, and you should attempt to. Never invest a bulk of money at once, invest it in small chunks on a regular basis, so you will get an average of the market, which is the best you can hope for.

By the way, there have been inidcators and reasons for a downwards turn for years, and I know people who stoppend investing years ago, losing out on gains. It's never a good idea to time the market.


> The market is likely to turn downwards within the next year or two. There are too many indicators pointing to this.

I am all ears.


Invest:

- some in crypto

- some in a few angel rounds

- put some aside as the stock market will crash and you'll be able to buy most stuff at 80% (or more) discount


Very funny, you almost had me.


If I was in your situation I would take a break from work and enroll into a collage and try to get another degree.


Do you have no hobbies because you didn't have time or energy for them?

There's a whole lot of interesting things to do...


If it were me, I would...

Set aside a large chunk of it in some investment/retirement vehicle to provide funds during retirement or should something dramatic happen in your life that you need the money. A personal safety net / retirement fund. If you or your wife's parents are still around you might consider if they will need help in retirement (I know mine will).

Create two funds for the kids for use if they choose to go to college or whatever. Nothing dramatic, just enough to offer aid and support during that part of life transition.

Set aside a fund and find a local cause to support. Something you and your wife might do together. Don't toss all the money at once. Do a monthly or yearly donation and become involved in making the lives of others better. Not just as a financial supporter but as a real life presence that does real work to make a difference.

Take up woodworking or welding or sculpting or painting or something else that involves making with your hands (or whatever you are physically able to do)

Find a new job and be super picky about what you are doing. Try to find something you will be proud to work on.

Not a complete list by any means. But with a little list like this you will be making a choice to better the lives of your family, community, and yourself. You have the potential to be a positive force of good in the world. You will feel good knowing that you utilized your situation to give back to the community you live in.


You should checknout the financial independence subreddit, it deals specifically with this topic


Just live frugally, be prudent with your money, save for your kids or any emergency. Be happy.


Congratulations on the Independence. Be aware of maslow's hierarchy of needs though.


Just wanted to say, the throwaway handle you selected is prime, 'throwaway8m'


If you do go for wealth management I’ve heard good things about https://www.hightoweradvisors.com

I forget the exact benefit but it was something about independent analysis and not being the consultant and the provider at the same time.


Congrats on Qualtrics exit :)


If you have to ask, nothing. Put it aside in ETFs or something for your kids.


I think you need to invest in my startup :p

Kidding aside! Ask your kids what their aspirations are, and spend a part(may be around 30-40%) of that money accordingly. Use around 30% of the money for your investments. Keep 20% of the money in safe (try not to use it). Spend 10% of the money on charity.


Put aside enough for your kids college education. Put aside a year’s living expenses.

Donate a small sum to charity.

Do you really have much left after that? Kids are expensive.

Unless you are ready to stop working I wouldn’t retire - enjoy some time off and do what you love now that you have options. Thank the lord for your blessings.


If it were me, I'd talk to my CPA about long term tax management. Then I'd probably talk to a second CPA about the same issue. Then I'd follow their advice to make sure that I minimized taxes going forward. I'd also err towards capital preservation.

I'd probably take the wife and kids out to a really nice dinner and write some anonymous donations to worth causes (on the order of $10k or something--you can get money orders if you don't want charities getting your address).

Then, I'd take a few weeks and do nothing, just hang out with the kids and the wife, read, code, whatever. Let your mind marinate.

Then I'd write out some goals for the rest of my life. They don't need to be firm, but could be 'I want to learn about X to see if I really want to do it' goals. I might engage with a career coach and see if that could provide some guidance about next steps--they have tests that can help give some direction.

tl;dr

* preserve your capital from risk and taxes

* take some time off

* but not too much time

* find something you can pursue


There's two components you need to manage here: the financial/legal/security component, and the personal component. The latter is the really hard one.

For the first, you may want to go as boring and sane as possible, make sure there's never a way to lose all of it at once. Banking crashes? Have money elsewhere. Other country crashes? Have money at home. You crash (literally, in a car, and become disabled), have someone you trust have access to part of the money. Your family crashes (emotionally), have some money somewhere safe.

And, for the personal component — the tough one — you have two troublemakers: the urge to treat yourself and live a little, and the urge to make something entirely different of your life than you thought was previously possible.

While you say you have no vices, understand that they come and go as they please, and you might find yourself in an unexpected situation with a perfect vice to match.

It's like going up escalators. Floor 1 and 2, regular people, regular shops, you've got all you need there. Now you're on floor 6 or 7, everything looks ridiculous. Why would anyone need another house, why would anyone drive a fun car and a regular car, why vacation on a tiny island at the remotest place on earth? Why.... well... I will be dead in a few years anyway, so... I can do what I want. I should do what I want. Why do I live, if I don't live a little! Those things catch you out on the days when your emotional vinyl record skips a little, just for a split-second. Maybe you used to treat yourself to a chocolate pastry you'd usually skip at Starbucks on a bad day, which, now is capable of turning into a cancerous flaw around your self-reward-system. Something with the kids, something with the wife, something with a friend asking the wrong thing. Not everybody is like this, maybe a lot of people aren't, but most won't know before they come across a bit of money mixed in with a cocktail of new opportunities.

The calmest and most-stable rich friends I have, are those who live a life that really is almost entirely like anyone's life. They spend on things that matter, which is health, security and reasonable comfort, and are just like everyone else otherwise. They know when the grocery store raises their prices is what I am trying to say.

I think the best thing you could do, and bear in mind this is advice from a random stranger on the internet, is to pay yourself some kind of yearly allowance. Much like a salary. In a perfect world, that'd be mostly from interest and similar gains, but don't be too tempted to maximise that (and its risk). Do work, do something that excites you. Working with other people you like very often trumps trying to manically work something out for yourself, but everyone's different. Possibly work part time, two or three days a week, spend the rest of the time seeing your kids actively grow up. They'll appreciate it later, even if they won't show it now.


Keep working.

Health insurance premiums for your family will increase forever.


Dude, first off, congrats! Secondly, regarding this: "I do not THINK I have any real hobbies." FIND SOME HOBBIES!!! You've got all the time in world to what you love, or what you used to love. As a kid, what did you want to be when you grew up? What makes you tick now? What are you interested in or think you could be interested in? Do you have academic interests? If so, cold email some professors in your area and join their labs. Or go back to school in a fascinating subject. Go traveling and do cool things like parasailing, eat good food, listen to good music. Learn how to cook, PLAY some music. Learn an instrument with some adults that are also newbies to music. Learn to dance! Go clubbing with your wife, even though it's not your scene. Get a couple's massage! Have some kinky sex!

And, most importantly, do some cannabis with your closest friends. Take 5mg of an edible if you don't like to smoke.

Then sleep in the next morning. The day after, get up at 600 and get after it :)


I have like $15m am around your age. If you would like to actually talk to someone in your category, give me a throwaway email to message you on and let’s talk. The advice here is generally good, though.


First thing: Tell no one except your wife.

lol and don't donate


1) don’t listen to strangers in internet. 2) don’t stop working. work part time on something you enjoy; no more grinding. 3) start running and complete a marathon on every continent.


www.fastnedcharging.com

We are looking for investors. You will be doing something great for the planet and you will grow your wealth at the same time.


I highly reccomend you to sent me a part of them.


You just need to smoke that rapper weed and dmt


Give me 1 million and let's be friends and deal with our sudden wealth.

Joke aside, you already got plenty of good advice here, I would just suggest you invest a fair amount in Bitcoin.


Not that you will do it but,

Since you mostly feel "lucky", find the devs or other people who worked their asses off to make this happen and who did not get anything.... and share!


jesus christ friend, you are free to make whatever decision you want, that is what the money grants you. Work or retire, i'm sure 8 mil is more than enough to do anything. I'm sure with proper investments, even lower yielding ones, you should be more than good. I'm not really sure what the people below who say that its not enough really do with their money, it is more than enough.


Spend $8M to not have an average life.


Hire an advisor, and buy some plane tickets for your family. There is, in my opinion, no greater education than seeing the world.


open up a small ice cream store with short work hours, and spend time with your family. :)


There are many problems in the world ranging from atrocities to missed opportunities. Is there nothing that bothers you?


Given your situation you can wire me 1 million. Shoot me a reply and I’ll send you my info. Congrats on your big exit!


Donate it. Regain your peace.


Index funds. A money manager will cost 80k year, 1%. Index fund will cost 8k year. Check out vanguard.


That's awesome, congratulations!

If you're not already familiar with FIRE (financial independence, retire early) then check out these subreddits:

* http://reddit.com/r/financialindependence

* https://www.reddit.com/r/fatFIRE

Most people use a safe withdrawal rate of around 4%. If you retire at 50-60 and invest your money in index funds, you can withdraw around 4% per year if you want to end up with $0 just before you die. If you use a much more conservative rate of 3% and minimize your expenses during a market downturn, then your assets should actually continue to grow while providing you with a steady annual income.

$8,000,000 * 3% = $240,000 per year

So the first thing to realize is that this does not make you ultra-rich. There are plenty of people working at tech companies (especially managers) who are earning around $240k per year. However, this means you can earn the same annual income without ever working again for the rest of your life. Don't buy a bigger house or a few new cars before you think about this carefully. It would be very easy to inflate your lifestyle or send your kids to much better schools, and then you would just have to keep working to pay all your bills (and you probably wouldn't be any happier.)

I don't think you need to hire a financial advisor. $8M is a lot of money, but it's not too much to invest by yourself. If I were in your shoes, I would put a lot of the money in index funds (VOO - Vanguard S&P 500).

Also you should really ask yourself if you need more than $8M, or if $240k per year for the rest of your life is plenty of money. If so, I would avoid any risky investments, because you need them. If you want to do some angel investing or buy some Bitcoin, do it with no more than 5% of your assets, and just because it's fun. Don't purchase any rental properties unless you want to deal with maintenance and tenants. And definitely don't be tempted to start your own company and invest a lot of your own money. You would be taking on a huge amount of risk for no reason. It's very easy to lose all of your money that way.

Anyway, I should try to answer your questions:

* Should I donate it?

Yes, that would be great. If you want someone to recommend numbers, then I'd recommend an initial donation of $1M, and then 10-20% of your annual investment income.

* Should I hire a personal wealth manager?

No, I don't think that's necessary. A lot of them end up charging really high fees for below-market returns. I would start looking for a good financial advisor around $25M. But you should definitely find a good accountant.

* Should I retire?

Yes, definitely. At the very least, find some work that you enjoy. Don't just keep going into work because it's what you've always done.


I have no debts or “vices”. I do not like smoking, drinking or going out.

Maybe it's time to start. :)


wow. the most honest self assessment ever!!


congratulations!


Congrats man, you have what most of us do not.

FREEEEEEEEEEEEEEEEEEEEEDOM.


Real estate!


spend it on hookers and cocaine


Invest in people and bicycles as a social experiment.

Bicycle workshops were where all of today's big auto makers got started. The Wright Brothers also got started in a bicycle workshop.

So what would happen if you made the largest individual purchase of bicycles in history and gave them away to some war torn part of the world? You could choose a town in Afghanistan where the road/rail connections were not great and choose a demographic - all 16 year old people in the town. The bicycles could be reasonably decent and fit for purpose. There need not be any strings attached, however, your 'sponsored' town would be different to other towns due to the bicycles.

In five years time would the economy of that town grow in ways that neighbouring towns did not? Would there be bicycle workshops and innovation? Would people be better educated? Would your 'bikes not bombs' development model inspire others?

You need not even visit your chosen war-torn town to get things started. You could get some post-traumatised veterans to go out there and do the swords to ploughshares bit, setting up bikes properly and making sure that everything was distributed as per the 'experiment'.

A few years ago the bicycle company Kona made an interesting bike for Africa, it enabled Western buyers to buy two 'Africabike' models at full retail with another 'Africabike' being donated to Africa. Somewhere in Africa, a long way from the news headlines are doctors able to do their rounds in a fraction of the time due to their steeds. This is conventional 'charity'. You can forget the 'charity' part and instead just see if you can stimulate a whole economy, albeit at a town size level, just by adding bicycles.

I am sure that in years to come the people of this to-be-decided town would welcome you and your family as kings, even if the bicycles did end up wrecked after a few years.

You might laugh at this suggestion, however, I have helped a local homeless guy with a bike (and a radio). He has too much pride to be 'homeless' but he is, even if I don't see him that way. The bike enables him to do dog-walking gigs and gardening jobs that were too far away to get to when walking was the only option. There is a small virtuous circle enabled this way, not everyone can find a person to walk their dog whilst they are working, not everyone is fit enough to keep their garden in order. My friend is not stuck as a beggar. He contributes to the local economy, earning money fair and square. The bike enables this transformation.

There is quite a lot in it for me too - I don't have to shuffle by my homeless friend, ignoring him out of fear I might have to be parted with my 'spare' change. I also like to have a go at fixing things so my bike skills stay fresh. I also feel a lot safer in public areas due to being on first name terms with local homeless folk including aforementioned friend.

So my advice is to do the bike thing at a larger scale for enlightened self-interest reasons.


First, there's some pretty good advice already here. I'm not really adding much, but I'm hoping I can simplify some things.

Don't freak out. There's nothing to freak out about. You have a windfall, and unless the taxes are wrong, you can live the rest of your life on the interest.

The simplest thing to put the money in an index stock market index fund (I have very high trust in Vanguard, but there are lots of low cost index funds in most brokerages). You can realistically live off of a 3% draw down for the rest of you and your wife's lives, and never have to worry about the capital. 3% is very conservative, and many consider 4% to have a very good chance of continuing to grow your capital. This means, that your family now has a nearly guaranteed income of $240k, which will more or less grow with inflation. And is more than enough to live on in roughly 95% of the world.

You mention everything is paid for, and no debt. This is good, if you're not including your mortage in this, it's definitely a good idea to pay off your mortgage even if it's below 4% simply because you reduce your risk profile.

If you want to get fancy, and reduce your risk profile even more, at the cost of income, it's a good idea to also hold an index bond fund, somewhere around 30% of your portfolio. You'll want to decide the percentage up front, and rebalance your portfolio at least every 2 years. More often is better, but I've never run the math on how frequent will minimize your tax burden.

It's also a good idea to keep cash reserves of somewhere between 1-3 years living expenses split amongst multiple banks. This is mostly for catastrophic risk prevention, and will prevent you from selling index funds if there's another black monday, and prices are at their lowest.

If this is all you do with your money, you will never have to worry financially ever again. Just continue to live within your means, and don't try to show off your wealth, or keep up with the Joneses.

This means you no longer need to work for money again, and can be very liberating. Now you can take a job that normally wouldn't pay enough, or get a PhD in some field that will never make sense financially. All of my favorite school teachers in high school were mostly financially independent, which meant that they didn't have to tow the line, and could contradict the administration if they felt like it. It does sound like you may have to worry about motivation since you will no longer have any extrinsic need to work for money. I'm not sure how to help you here. I have so many things I'd do if I didn't have to work for a living (ironically many of them have much higher earning potential than my current career, gotta love local maximas...).

You may also want to lurk in the subreddits related to FIRE (financially independent retire early), the content isn't as pertinent to you, since you aren't striving anymore to retire early, but you'll find people who are very economically conscious, and want to not have to be wage slaves anymore.


Vtsax


I can tell you two very real scenarios that happened in my family (a lot of wealth inherited):

1. Burning through $10m in 30 yrs. is a piece of cake. Bad investments probably ate 50% (“I am wealthy, I know how to manage money”), excessive spending of shit nobody needs ate another 30% and 20% gone for fun things like divorces, private schools for retarded kids, lawyers getting kids out of prison and that kind of “wealthy people shit”. 2. That kind of money can last multiple generations. Do not let physical possession get in place for independence and growth of yourself or your family. Maintain a decent lifestyle, buy nice fancy but long-lasting stuff (eg. Steinway piano, Glashuette watch, etc) and invest in yourself (travel to places fewer people have seen, exercise, buy a nice bicycle and cross the Alps, learn a new language, get a pilot license,...). Keep yourself and your wife busy with some income generating mechanism you generally enjoy mostly. Keep a low profile, live a decent middle class life and when your kids are out of the house and know what “making a living means” increase your spending.

Let me tell you (from personal experience): 90+% of the people burn through this kind of money in 25 yrs easily without actually enjoying themselves, creating only greed, jealousy and hate around them.

I am not sure I would recommend learnjng more about investing, getting prepped up: watch Wulf of WallStreet, WallStreet, the big short, read the books from Taleb (brilliant) and the book “fooling some of the people all of the time”. Academia is full of retards and morons in the field of investing. If anybody starts talking crap like “CAPM”, “beta” or “trend analysis” - run. It’s fairy dust and bullshit wrapped in suits (I worked in investment banking, strategic management conaulting and have a PhD in that shit). Diversification doesn’t help during “correlation breakdowns” (aka everybody withdrawing money) and a bull on the stockmarket may just be actual inflation people don’t realise.

You need to invest money because inflation will take it all away. But more important than your asset allocation is whether you are invested/not invested...

Like always in life, it is the big picture/decision that matter: - Move to Europe: free university tuition and cheap real estate (saved you 750k for your kids med school) and 1.5m in housing - Don’t invest if you don’t know what you are doing. Doing nothing is a very good idea sometimes... But keep in mind how inheritance works in Europe - setting up a fund or something and may make sense... - Talk to a tax advisor: can you move and save taxes? Can you transfer/restructure the money so you don’t have to pay tax now/taxes at all? - Are you legally prepared for a divorce? (Not saying you should change your spouse - but what if she wants half the money and files for a divorce?)

Ask yourself the following questions potentially:

- Will you be more happy if you buy more stuff? What made you happy in the past? - How will you feel if you lose 20/30/50% of an investment? - How will the relationship with your spouse change if you stop working? What emotions may your spouse have? (feeling of entitlement, greed, panic, frustration, hate) - What will your kids be like if they feel they are rich? How will wealth affect their aspiration, growth and seld image? What role model will you be? - How will you GROW when you stop challenging yourself?

I would highly recommend not to give your kids any money upfront or promise anything. Let them develop ambition and grow. Give them a safe place if they fail - so they can keep trying. Start building a sustainable fortune for your family - so it lasts for generations. Invest, don’t gamble. Be humble and understand: you may just have been a lucky average guy - what makes you think you make great investment decisions (sorry for coming off like that, but ask yourself)?

“Having a fortune is one thing - being able to manage it and be happy another”. It can be a real curse - take away your happiness and ruin your kids and spouses life (I saw it happen).

Congratulations! I hope you will enjoy longlasting prosperity and joy!


I know a bit about the subject and here's my advice:

1) Take care of your will and heirs - sometimes it's called "estate planning". There are cheap options online, with the risk of making some terrible mistakes. Hire an attorney with lots of experience doing this, and ask him/her to setup a trust for you and your family. Make sure you fully understand the tax implications of what you're going to setup.

2) The biggest risk of a large sum of money is trying to manage it and allocate it all at once. Imagine that investing or managing money is like a sport, and you have pretty much never trained for this. What would you do? You'd take it step by step. With money, slow down and take a decision at a time.

3) 8M is in the range of "f*ck you money", which means it gives you complete economical freedom for your life, and probably for your heirs too. It's probably wise to maximize for "survivability" of your egg nest, rather than trying to make even more money. Therefore, be conservative when deciding where to invest.

4) Diversify: like redundancy for high-availability IT applications, you need at least 2, possibly 3 quite independent asset classes to invest into (e.g. real estate, stocks, bonds, cryptocurrencies, foreign real estate, etc). Unfortunately, common wisdom about how to properly diversify is debatable to say the least. Spend some time reading and learning and try to come up with something satisfactory.

5) You might hire an investment manager, I am not a big fan of most of these guys, but it might be a way to learn, and you don't need to allocate a huge sum with him/her (perhaps less than 500k?).

6) Make sure you and your wife are 100% aligned with your "money" strategy.

7) Don't make it too public that you own $8M. It's not unheard of in certain places like Silicon Valley, but at the same time, when people know you're rich, they take for granted that you can afford things and that you are supposed to contribute more to other things. Certain relationships become a bit complicated. Just keep it for yourself.

8) Make sure your "IT security" is safe, especially if you will end up owning cryptocurrencies, but also in general.

9) Other than this, enjoy your life. Money is to buy freedom.

10) Finally, if you think you've been given a nice hand by fate, why don't you commit a small fraction of that (2%? 5%?) to doing good for others. Pick a charity, or even better, take a year off and volunteer somewhere with your family. It could be great.

I am no way as rich as you are, but I have enough to be able to "buy" me time with what I have accumulated in the past few years, and that allowed me to do what I wanted to do. It didn't go as expected, but I don't regret it.

At the same time, when you didn't grow up with money in the family, it can be surprisingly hard at times to deal with large sums earned quite quickly, like in your case. The worst parts might be dealing with your partner/spouse, dealing with your friends, and dealing with big recessions where you wipe out maybe half of your net worth.

Good luck.


Retire? Become an angel investor?


Obligatory "pay my student loans"

In all seriousness, mutual index funds. Watch it grow. Secure your grandchildrens future.


damn, lotta people here know what they would do if they had $8 million apparently


Do not tell anyone about it.


Start a startup?


travel


I don't have any advice for you, but I had to comment on your use of the word "nice" to describe your wife.

I thought it was funny! "I've got these two kids, but my wife, oh boy she's a good 'un!"

It was just sweet, is all.

Anyway, to be marginally helpful (I hope), I would also recommend that you keep in mind that a lot of the advice you're getting/going to get is meant to protect you from bad things that have happened to other people. It's all probably good advice, but just because those bad things happened to other people, doesn't mean you're going to get caught up in those traps as well.

In other words, use your own judgement about this stuff, don't just default to following the advice of others. Maybe some of your friends can handle knowing about your new wealth, maybe you can afford a new car without letting all the money slip away in the first year.

You know you better than we do, remember that.

Also, pick up chess! It's great! I love it because while there is some money in it, there isn't enough to lock away the good knowledge, so it has a low bar to entry. Something to occupy your time while you do all the other good advice on here, maybe.


If you are unsure then sit on it for a few years. That is barely enough money to retire comfortably the rest of your life. If you truly feel giving it away makes the world a better place then why not. Chances are though you using it to better your life and find your niche would further enrich those you came into contact with. Do not feel guilty about having money that you actually earned. It is not like you got rich off the violence of regulation.


> That is barely enough money to retire comfortably the rest of your life.

Barely? Using the "safe withdrawal rate" of 4% after inflation if the money is invested, one could spend 320k a year and probably not run out.


I assume the OP has to be making about at least $130k salary, approximately $200k in total compensation. That gives 42 years at the current lifestyle at a lifespan of 85 years. That assumes wages track inflation. Lifespan should be higher by then too. I'd consider maintaining lifestyle as comfortable retirement.


This is if you just let it sit in an account instead of investing it. The parent comment is saying if you invest it you will be able to take 4% each year and still keep the nest egg in tact.


Wouldn't you need about 4% per year to break even with inflation? Can you safely invest at 7-8%?


You can search for "the 4 percent rule" or "trinity study" if you're curious about more. But basically, stock markets over long time average 7-8%. Subtracting inflation gives you a rule of thumb of 4% that historically would have worked.

Of course, the future might not match. But the studies also use a fixed withdrawal rate throughout. One could further mitigate the risk by having a small side-income some years, reducing spending in down-years etc. Also, how much money one needs post-retirement is often less, for instance if the mortgage is paid down, not housing kids any more etc.


So last year based on new treasuries issuance the neutral rate was 6.2% before unbacked credit emissions like student loans.


Is this trolling? How much money do you spend per month lol?!

The OP could buy a 1M house and still have enough left for $14.5k per month salary for 40 years...


Wisdom from https://en.wikiquote.org/wiki/Warren_Buffett and his life style is extra-ordinary https://www.cnbc.com/2017/01/30/warren-buffetts-breakfast-ne...


put the money is fund, one that is safe but gives like 3% annual return. Quit your job, spend time with family and maybe start in a NGO or other voltuntary workplace. Help other unfortunate people. You have now a stable passive income. Spend some of the annual income on vacation with your family


How can I find an opportunity which can result in making $8M? Do I have to get at least 5% of the company?


There is a reddit post about what to do when you win a lottery. Go read that first!


First of all, congratulations! You've made it above the pack.

Now your upward mobility is significantly improved.

I would recommend taking the VC route.


vegas!


Put it all in Bitcoin.


worst advice ever


> ever

It would have been good advice a few years ago. :D


He wasn't in this position a few years ago.


>Should I donate it?

do you seriously consider this? Sounds crazy to me. Or pretentious.

Why bother with working another job? Do your own thing, fix something in the world.


Some people experience very real guilt/depression when a windfall happens "I don't deserve this" "why me" "shoulda been someone else" etc, not unlike survivor's guilt.


Well, didn’t happen to me. “I might not deserve it, but thanks”


Put in in a range of safe investments and live a quiet life.

You’re not rich, your very well off, it’ll last till your death in great comfort if you are careful.

Don’t start giving it away or spending it.


>You’re not rich, your very well off,

His 4% safe withdrawal rate is 10x my gross salary... to many of us he is in fact now quite rich.

I need 650-700k to retire,OP never ever ever ever ever ever has to work again.


#1 pet peeve of people with large personal wealth is their aversion to being called "rich". You're rich, embrace it, own it, even if you didn't earn it.

I was once hired to build a website that catered to people that I would call "rich". I remember the horror on their faces when I casually asked "do rich people do X?"


Having $8M isn't rich to you? That's a lot of money, you probably should give at least some of it away to charity.


I think it was the founder of Maxim (don't remember his name, and can't point you to a link) who categorized various levels of "rich". Below $20 million (assets, not income) he classified as "the well-to-do poor". Yeah, maybe his perspective is skewed. Still, there are people who seriously suggest that $8 million doesn't make you "rich".


It's "rich" in the sense that if you're smart and a bit frugal about it you'll never have to work again. It's not "rich" in the sense of never having to worry about money again. Really rich people will spend $8M adding a new garage to their summer house.


>It's "rich" in the sense that if you're smart and a bit frugal about it you'll never have to work again

If does nothing but spend money he can spend $150k every year until he dies. Not exactly frugal.


150k$ a year is rich in Vietnam maybe, but if you plan to stay in the west, you'd be upper middle class at most


$150k net for 50+ years is upper middle class at most in America? Jeez some people are in a bubble.

Reminder this is assuming he completely stops working and does basically nothing with the money except match inflation.


According to this : https://www.thebalance.com/definition-of-middle-class-income... 150k is just the limit between upper middle class and high income, and most politicians use 200ke as the definition of high income.

You might have a different definition of upper middle class, but mine has following


That's pre-tax.


1. Save the money. Don't spend it out of excitement.

2. Save the money. Don't spend it out of excitement.

3. Consult a finance professional.

4. Learn investment strategies and learn to invest slowly. You have enough money to experiment wisely.

5. Be happy and peaceful with your family.

6. If I had money, I would donate some to D Language Foundation[1]. It is a very modern language but it is developed only with community support. Donations will help fasten the development as a whole and stabilize the language and eco system. Why donate to D? Cus the world has donors for cancer, heart, etc and get good marketing that sometimes things like D get entirely overlooked.

[1] https://dlang.org/foundation/donate.html


Buy a sophisticated wealth totem, like a million-dollar painting from a canonical modernist artist (Warhol will do if you want to play safe).

Place the painting in a central location in your home. Don't spend on anything else extragavant. The painting-totem will act as a constant comforting reminder of your available wealth, and is also a solid diversifying investment in an asset class that's popular among the wealthiest 0.01% but unavailable through funds.

(Also, don’t take investment advice from strangers on the Internet.)


I would buy a high yield stock like wells fargo. With 8 mil after taxes, you could buy enough wfc to payout 220K a year in dividends before a paltry 15% tax. You’d likely receive increases every year and as you did, your stock would appreciate.

You might not like the idea of wells fargo or financials, so find some other lesser yielding stock(s). Never sell them and try to reinvest dividends at 50% with your minimal expenses.

A lot of people won’t find this sound advice, and you’d have to do your own homework so when you buy, you understand what you’re buying.

But, treasuries are too conservative, as is John Bogle in general.


Yeah, why do something conservative when you can invest your $8 million in Wells Fargo shares. What could go wrong?


This is why I love investing. So, I’m getting downvoted, but I understand where it’s coming from. Either Wells hate, non diversification, or financials / financial crisis. Or all 3.

But, for me anyway, investing is about being rational. Do you really think you’re in a better position working at a nonprofitable startup (like a lot of us are), or owning 8 million worth of a company that nets 20 billion a year?

Im not trying to be snarky. Im being dead serious. People read things that go against the crowd and they follow the herd. Being contrarian doesnt make one right—being right makes one right.


There are problems that money can not solve, but Artificial General Intelligence would solve. Think about an artificial intelligence that could learn about health, chemestry, microbiology, develop and apply medical knowledge much faster than humans do, with no limits. So I would work on Artificial General Intelligence, with a team of neural network programmers and computational neuroscientists to develop the required evolutionary algorithms and neuron simulators to implement biologically inspired memory circuits and some brain process simulations that could lead to a new form of computing and artificial intelligence. (But unfortunately most who could do this are buried in mundane client related problems.)


I think you are vastly underestimating the amount of money this requires.


As someone suggested in comments, save at least 1 year worth in a safe haven (preferably gold)

No need to freak out; Relax!

Do NOT donate - That is being irresponsible

Do NOT hire someone - It's not their money; you were at the right place at the right time - not them - you have the responsibility to invest right.

Please do NOT retire - you are at your prime age of contributing back to the society - surely, take more vacations, and spend time with family - may be work only 3 days a week.

Do NOT spend on a fancy house or a car - Not worth it.

If it's of your interest, become a venture capital - You should be looking at 10:1 success ratio - so be ready to lose money on most of the investments - but eventually, you'll create so much value, that it'll be worth it.

Take at least a quarter or two of time to decide the budget - you'll learn a lot. And I believe you have the liberty to do it. ;)

Set aside 10% or whatever you are comfortable to lose for risky investments(bitcoin and sorts) and returns from that for squandering - Don't go over budget there.

Park money in an insured, interest-bearing spot (1% yearly is going to give you 80k just for parking - consider money market accounts - Caveat: FDIC Insurance covers only till 250k per account per person - figure out the details)

Most importantly, what you are essentially getting is time - Try to find a cause worth spending your time.

One last piece of advice - Don't get attached - Know that money is the means, not the ends.


Just to be clear, I'm not against helping other people. This is what I meant by NOT giving to charity - https://www.keela.co/blog/nonprofit-resources/charity-vs-phi...

"Don't give a man a fish, teach him how to fish"


I would blow some serious cash right away. Buy a Tesla Model S P100D. Tell the wife and kids you're going on a spiritual retreat but instead hang around with 30 something girls and party your ass off (you don't have to have sex with them). Do some ecstasy. A good role model is Dan Bilzerian.

https://www.instagram.com/danbilzerian/

Buy a bigger house. Preferably one large enough where you don't have to see the wife and kids unless you want to.

Stay employed, but act like Peter Gibbons in "Office Space". Just be a complete prima donna / asshole and see how long you can get away with it.

Get an expensive hobby. Drag racing, airplanes, competitive ham radio, golf and sports season tickets.


This is the approach for sociopaths, yes?




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