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Ask HN: what would you do with $750k that you just inherited?
17 points by magsafe on Sept 30, 2013 | hide | past | favorite | 36 comments



You should take 10% of the take-home value and blow it on something incredibly expensive, awesome, and ostentatious.

Whatever it is, after the fact you should feel guilty and wasteful when you are done. This will keep you from blowing the other 90% bit at a time.


Retire. $750K is $30K in passive income for the rest of your life (assuming you already have a residence).

Welcome to complete financial freedom to do whatever you want in life [0]. You don't necessarily need any more money to be happy [1], and the point of getting filthy rich is to attain freedom of time [2], which you can get if you just live cheaper [1 again. Seriously, read this].

So really, this question should be: what would you do with your life if you could do anything you wanted? That, I'm afraid, is a much more subjective and philosophical question that the margins of this comment are too small to contain a satisfactory answer to.

0. Unless you have substantial current debts. If so, pay those off first.

1. http://www.mrmoneymustache.com/2013/02/22/getting-rich-from-...

2. http://www.amazon.com/How-Get-Rich-Greatest-Entrepreneurs/dp...


Yeah, having 30k in passive income for the rest of my life would be a DREAM. I don't think I'd retire, but I'd certainly start doling out my skills to nonprofits for significantly reduced pay. I don't think I could live on $30k/year, but even if working for nonprofits only netted me another $20k/year total, I could live on that - and save them a significant amount of cash that they'd have otherwise had to pay.


Daily expenses in 10 years will be much more higher than now. 30K will deflate over the years.

I would buy a house, then put it to rent.


"You don’t know what sort of rollercoaster rides the economy will take your retirement savings on, and you also don’t know what rate of inflation will persist through your lifetime. Will a box of eggs cost $6.00 a dozen when you’re 65, or will it be closer to $60? How can we possibly know how much money we will need to live on in retirement?... Inflation eats 3% on average, leaving you with 4% to spend reliably, forever."

And then MMM goes on to mathematically justify that 4% number: http://www.mrmoneymustache.com/2012/05/29/how-much-do-i-need...


As you suggest inflation would significantly reduce your available buying power.

That said I'd guess you could live pretty cheaply if you owned your house outright and were frugal.


You can have a house for renting. There's all kind of renting options, some of them are more economic viable, for example, tourist renting gives you a lot more money than permanent one and you can make for a decent living even buy a new house if you do it well, but of course, this only happens if you are in a popular tourist destination.


Not ask Hacker News.

Find a financial planner who can advise you on, the tax implications of a sudden windfall (federal estate tax, IRA contribution limitations, etc., etc., etc.), how to account for your living expenses + inflation, and how to overall preserve and/or grow your net amount.

Then you'll know how much you really have to "spend", and over how long of a period.

Then, if you're so inclined, come back and ask HN "What would you do with the net $XXX K that you just inherited?"


Continue as-is - put the money aside and do nothing different at all - until you educate yourself enough to answer your own question. Until you educate yourself to that point, you are asking for others to siphon off that $ for themselves.

The age-old adage "a fool and his money are soon parted" has some relevance here. History is replete with examples of people winning the lottery and then spending it recklessly.

Asking the question is a good starting point - it shows you are aware of the possibility of making bad decisions about it (rather than a naive "it doesn't matter what I do with it" attitude). Now you must accept that there is no simple answer, the burden is on you to educate yourself and find the answers yourself.

It's not the easy answer you might have been hoping for, I know. Instead it is, as I said, a special kind of burden. But one I bet many people would like to take from you ;)


As someone who was lucky enough to be in similar situation three times ($30k, $80k, $200k, at each time - a lot of money for me)

1. There are a few books on the subject on Amazon - written especially for inheritors and by people who professionally help them manage their wealth - go and check them out.

2. Whatever you decide to do with money, keep a journal. I've got a google spreadsheet open, and once in a while I note down all my assets plus all the decisions I make in regards to them. This has two benefits - one is that it removes a bit of emotion from the decision-making process when you have to write it down. It forces you to use logical arguments. Second benefit is that you'll be able to get back to your decisions from a couple years back, and either see whether they still hold true, or see why you made a mistake you did. For example, I bought Nokia shares a year ago. I noted down the reasons for that (WP7 and Lumia being undervalued), and now I see the reasons no longer hold true (Nokia no longer has Lumia)- I'll need to find new reasons to keep my shares, or sell those shares.


Also, I'd say - disregard anyone who says "20% for this, and 30% for that" without knowing your situation. It all depends on your risk tolerance, your age, your monthly expenditures and so on.


750,000 $1 hookerbots, or 1 $750,000 hookerbot.

Unless you're ridiculously lucky this is probably the single biggest pile of cash you'll ever have so if there's nothing you particularly want to do right now then take your time and think about where you want to be in 5/10/15/20 years.


I'd buy a house for myself.

I'd buy 1 low-end rental property (dip my toes in with 1 before finding out I don't like land-lording).

With that much cash, inflation becomes a big issue. You don't want to let the money sit in a regular checking or savings account. I'd hire an adviser on where to park the rest of the money to protect against inflation with minimal risk.

I wouldn't try to convert all of the money to real assets. The liquidity of paper is nice.

I would continue to work. It's a lot of money but I wouldn't call it set for life.

I would avoid high risk investments. ie no start ups.

Disclaimer: I am risk averse.


Start a business or buy a business so that you can make that $750K into millions. The barrier to entry in many businesses is startup-capital. So I would look for businesses that have that barrier and start one OR you can buy a business and expand it. Many examples include: you can buy a hotel, restaurant, real estate, and many more. A good place to look for businesses is craigslist (believe it or not).

It all depends what kind of entrepreneurial spirit you have. I know that if I had $200k right now, in a year or two, I could make that into millions (this will involved lots of hard work). If you are not willing to do work then you can buy "absentee business" where the owner does not have to be there.

You can also become an "Angel investor" in a startup. But there are many startups and very very few make it big, so big risk if you do not know what you are getting into.

Just my thoughts, it all depends how hungry you are and how hard you are willing to work.


How did you inherit that much money?

I hope nobody died, but in that case you have my heartfelt sympathy! Do not think about the money now. Stay with your family and ignore that you have a little more cash in your bank account for a while. Take care!

I agree with @mattgerboth, but I'd invest things first in order to raise the health and living quality of myself and my family to normal (no luxury).

This part is up to you, but I'd save 40-50% in order to buy the stuff required that you need after you've bought that 0.5-1mm$ company for half of it's price (everything is possible with hard work, don't just accept the first offer blindly). When you know that the company is making profit, just help the company manage itself, because too much management is what usually makes things worse. You could also hire somebody who is knowledgeable in that area unlike those SAP Business Analytics bullshitters...

Regarding family. You've not told anything about it or yourself. Don't you care to let us know about it, or do you want to remain as incognito as possible?


This post seems very relevant: http://www.paulgraham.com/selfindulgence.html

Basically people with money don't become poor through extravagant spending. Most of the time it's through "investments" that turn out to be bad investments.


750k is a bonus to you and you should spend it wisely as in use it to lighten your burden in a long run.

30% - Emergency Fund 40% - Investment Fund (Low & High Risk) 10% - Education Fund (Your children's education) 10% - Penny Fund (Use to cover your exceeded monthly expenses) 5% - Health Fund (Use to improve your health. Eg. Get a gym membership, eat health food, medical checkup) 2.5% - Entertainment Fund (Use to spice up your relationship with your wife, children or anyone important) 1% - Charity Fund (Do not give it all in one go. Give genuine tips and lend a little help to those out the streets) 1.5% - Do whatever you want to do with it.

Anyway this is just an example of how I would spend the money if it's given to me


20% - buy property: a house, condo etc

20% - invest in self: runway for a startup, education etc

20% - invest long term: index funds etc

20% - invest short term

15% - take care of current wants: car etc

5% - help others


In my opinion, this is the question that separates the entrepreneurs from the wantrepreneurs. It's easy to talk the big talk when it comes to startups: how you hire people, how you lead teams, what development methodology you use, etc. When it comes down to it, however, any business is a vehicle for turning money into more money, and your startup is no exception.

Wantrepreneurs think in vague terms about what they would like their company to be. Entrepreneurs think in concrete terms about the money and time commitments it would take to make that happen.

I suggest you randomly pose this question to people: the answers are often very telling.


Buy a rental property. 4 sublets paying $1800 per month is $7200 per month. Minus expenses, and that should net a $5000 or so a month. Enough to quit the job and hack on my ideas :)



Exactly :-)


Durable goods, that $750k took a lifetime to build. The least you can do is see it last another lifetime to hand off to someone else.

Things that will decrease your monthly out of pocket expenses. E.g. if you have a home, solar panels, and a solar hot water heater. Extra bonus if you convert to solar powered hydronic heating.

http://www.reddit.com/r/buyitforlife


Save $500,000 as rainy day fund. Take $150,000 for personal living expenses (runway). Use $50,000 in $5,000 chunks for interesting stock investments. The last $50,000 in personal business expenses in getting something up and running (used wisely, sparingly, and when you have to.


What is the form of the asset? I assume you did not get $750k in cash, but likely it is in stocks, bonds, real estate, or ...?

First and foremost, if your goal? Is it to increase your wealth, to live large for short but fun time, etc?

Your situation and goals will impact what you can/should do.


There are some good suggestions here already (starting with 'talk to a financial advisor'), so I'll just throw a few different ones out:

* Pay down all debts, especially high-APR ones

* Give X% to charity

* Put $XX,000 in savings as an emergency fund

* Travel a bit

* Save it for starting/supporting a family

* Help out a friend or two in need


Move to Cambodia and build a free school for the children there


create a very lean startup and test as many possibilities as possible, while also taking the time to learn the technologies that might align with your business


Set up a fab lab. It's missing over here.


Buy an island. Live there with friends. Forget about the world.

http://www.privateislandsonline.com/


Why downvote? I was genuinely serious.


Buy property.


$750,000 could net you $100,000 a year in income. Let's say $90,000 a year if you have an expensive property manager. You can start here: http://biggerpockets.com


First I'd watch Anthony Bourdain Parts Unknown: Spain, then I'd move to Granada and marry into a large family.


give it to my wife. she knows how to do.


Buy $750,000 bitcons.




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