Quote:
Originally Posted by scrolls
Are you a real estate developer or something similar? Investing 25% of the money into a field you're not an expert in (or at least very familiar with) is the quickest way to blow the money. If you took all $200k, put it in index funds and forgot about it, earning 8%/yr would get you $685k by age 50. Waiting another 10 years lets that money grow to $1.5M.
If you want to splurge/enjoy some of it then by all means go for it, but I think more often in these scenarios the person is best off putting it in index funds and forgetting they have it. Wait 20 years and retire a few years early.
the guy is asking for advice here. this is misleading. it might be unintentional but its definitely misleading
historically the returns might indicate your going to have 685/k on average, the actual returns will vary wildly over 16 years though. i would guess theres a significant risk of the investment being less than 500k and obviously the chance to have much more. it would actually be interesting to see some historical calculations on this
someone asking for advice here should obviously be aware of this if the plan is to do xyz in the future vs the opportunity cost of doing abc now based on x return rate and x timeline. you cant think or make decisions about your future like that because its highly likely you will have significantly more or less at that point in time
personally if im 34 with the wife and kids im investing this in my current lifestyle. a home. if there is money left over from that then you will have money to invest as suggested. i think retiring rich or dying rich is over rated. real estate appreciates. living a higher quality of life and in an appreciating asset is a really safe and responsible investment. living with less debt and the burdens that come along with it, has an under rated value also
long story short i would spend it on a home and build a lifestyle. with a nicer home in a nicer area you are providing a better life for you and your kids. if you like your current home then pay off/down debt. the less bills you have the more you can/will save and you can then get that 8% return to a lesser extent while actually having a higher quality of life
if you dont have an idea, plan, or the inclination to use this money to pursue a new business or lifestyle, this is the way to go imo. 200k is a lot of money to have in your hands at a given time but over the course of a life time it really isnt much at all. its a starbucks habit for you and the mrs