Million Dollar Question (asking for a friend)

[manaboutown]

Believe it or not I am asking for a rather wealthy friend who happens to have $1M cash lying around earning him next to nothing and has no ideas on how to invest it. He and I have known each other since junior high and we brainstorm on various matters from time to time. I told him I had no idea and was sitting on a lot of cash myself (not anything like $1M).

Anyway I thought it might generate some creative thinking as I am out of ideas. Stocks and real estate seem at present extremely overvalued to me. Anybody have any possibilities they would care to share?

[Toymeister]

I bought a TV home and flipped it.

[manaboutown]

I bought a TV home and flipped it.

Thank you. That is a good idea and likely can be done again and again with minimal downside risk if one is careful and sticks to The Villages which is unique. TV may be subject to some price slippage at this time in the real estate cycle but likely less so than most other communities.

My friend lives in Texas and is likely to stay there but I might look into flipping a home or two in TV.

A few years back my friend sold an office building for $3M he owned in New Jersey using a charitable remainder trust (CRT). He and his wife obtained multifaceted benefits from that and saved about $1M in income tax on the gain. He invested the proceeds from that sale in the stock market which has as we all know been on a raging bull bender.

[retiredguy123]

I have almost all of my assets with Vanguard Investments. 40 percent in the S&P Index Fund, 30 percent in intermediate and short term bond index funds and their high yield corporate bond index fund, and 30 percent in the money market fund. I hate that the money market fund pays almost zero interest, but at least the principal is safe. I also have a very generous Federal pension, which provides all of my living expenses, so my investments are probably too conservative. I would be interested in any ideas on where to move my money market fund assets to earn more than nothing, with a low risk of losing principal.

[manaboutown]

I have almost all of my assets with Vanguard Investments. 40 percent in the S&P Index Fund, 30 percent in intermediate and short term bond index funds and their high yield corporate bond index fund, and 30 percent in the money market fund. I hate that the money market fund pays almost zero interest, but at least the principal is safe. I also have a very generous Federal pension, which provides all of my living expenses, so my investments are probably too conservative. I would be interested in any ideas on where to move my money market fund assets to earn more than nothing, with a low risk of losing principal.

Your last sentence reflects his conundrum - and mine. What can we do with our cash today in the current investment climate?

There is no easy answer.

[Topspinmo]

Believe it or not I am asking for a rather wealthy friend who happens to have $1M cash lying around earning him next to nothing and has no ideas on how to invest it. He and I have known each other since junior high and we brainstorm on various matters from time to time. I told him I had no idea and was sitting on a lot of cash myself (not anything like $1M).

Anyway I thought it might generate some creative thinking as I am out of ideas. Stocks and real estate seem at present extremely overvalued to me. Anybody have any possibilities they would care to share?

Some people that got money don’t want to risk it. If you don’t need it why risk it? Never know where there another Bernie Madoff out there?

[Malsua]

Believe it or not I am asking for a rather wealthy friend who happens to have $1M cash lying around earning him next to nothing and has no ideas on how to invest it. He and I have known each other since junior high and we brainstorm on various matters from time to time. I told him I had no idea and was sitting on a lot of cash myself (not anything like $1M).

Anyway I thought it might generate some creative thinking as I am out of ideas. Stocks and real estate seem at present extremely overvalued to me. Anybody have any possibilities they would care to share?

Tell him to spend 1% of it on Crypto. Stick to the top ten or so, BTC, ETH, ADA, XTZ, LTC, DOT, etc. Most should go into BTC and ETH though.

If it goes on a bull run and it should, it'll triple pretty quickly. Could go to zero, but chances are not good for that to happen.

[Arctic Fox]

...friend who happens to have $1M cash lying around earning him next to nothing and has no ideas on how to invest it.

Forestry - low risk, good long term returns (for his kids, if not for him, as it sounds as if he doesn't need it to live on) and ecologically beneficial

[manaboutown]

Tell him to spend 1% of it on Crypto. Stick to the top ten or so, BTC, ETH, ADA, XTZ, LTC, DOT, etc. Most should go into BTC and ETH though.

If it hits and it should, it'll triple pretty quickly. Could go to zero, but chances are not good for that to happen.

A married couple I know got into cryptocurrency early on and have done very well. They have traded stocks, options and commodities for years and have done well. The thing is they are at it every day like a full time job. My friend has no interest in trading or actively following the stock market. The proceeds from the NJ building sale mostly went into a variety of stocks and index funds but given today's stock market valuations he is loathe to add to those positions.

[Malsua]

A married couple I know got into cryptocurrency early on and have done very well. They have traded stocks, options and commodities for years and have done well. The thing is they are at it every day like a full time job. My friend has no interest in trading or actively following the stock market. The proceeds from the NJ building sale mostly went into a variety of stocks and index funds but given today's stock market valuations he is loathe to add to those positions.


I'm not talking about day trading crypto, that's a recipe to get wrecked. Dollar cost averaging into Bitcoin and Ethereum is about as much of a guarantee of a winner as you're going to get. Some of the alt coins are solid too, like Cardano, Tezos and Dot.

We're talking buy and hold sell whenever you're inclined to.

[manaboutown]

Forestry - low risk, good long term returns (for his kids, if not for him, as it sounds as if he doesn't need it to live on) and ecologically beneficial


Now that is a thought. Thank you!

For some reason your post reminded me he is a collector and has extensive collections of old Lionel train sets, engineering textbooks and high quality children's books from the 1930s, postcards and stamps. At one time he was into hot rods and still has a Model T with a blown Chrysler hemi. He is a civil engineer. Although he is not Jay Leno wealthy perhaps he could start a hot rod collection?

[JMintzer]

One word... "Plastics"...

[walterray1]

Believe it or not I am asking for a rather wealthy friend who happens to have $1M cash lying around earning him next to nothing and has no ideas on how to invest it. He and I have known each other since junior high and we brainstorm on various matters from time to time. I told him I had no idea and was sitting on a lot of cash myself (not anything like $1M).

Anyway I thought it might generate some creative thinking as I am out of ideas. Stocks and real estate seem at present extremely overvalued to me. Anybody have any possibilities they would care to share?

what is the goal of the proposed investment. To a number of us at this point of our lives we may just want to preserve our capital. To some it may be to balance it all out between growth and preservation. To others it may be to take a big risk with the potential for big return. Maybe the point here. Guess it all depends.

[manaboutown]

what is the goal of the proposed investment. To a number of us at this point of our lives we may just want to preserve our capital. To some it may be to balance it all out between growth and preservation. To others it may be to take a big risk with the potential for big return. Maybe the point here. Guess it all depends.

He wants to invest it to generate some income and/or appreciation. He receives far more income from his business than he spends which is where this came from. He is conservative and maintains sufficient cash reserves. He was asking me if I had any ideas and I told him not really. And I don't as I am in the same quandary with a lesser sum.

[OrangeBlossomBaby]

If I had an "extra" million bucks, I'd probably just spend it. Or give it away, or donate to causes of personal interest. If it's "extra" it's because I already have enough that I don't have to worry about any upcoming expenses.

Might renovate the house, renovate my sister's house, do some travelling, buy a new car.

It would also depend on how old I am when I get this extra million. If it's now, at age 60, I'd sink a bit into some ordinary bank accounts so I can have cash in case of emergency. Pull the maximum out of the accounts every year to pad my IRA or whatever this thing is called that I invested in years ago every year until I'm old enough to be required to withdraw some.

If I'm already in my 80's, screw saving, screw investing. I'd spend it all on living as well as I can for the next 10 years. Maybe even get a face lift!

[CoachKandSportsguy]

Utility ETF, because of the uniqueness of the regulated utility market in this country. Based upon statutes, the utilities are guaranteed a return on assets. With the grid needing to be upgraded to nearly twice its size for the green movement, increased CAPEX means increased profits, and then increased dividends.

These are regulated monopolies, which have guaranteed returns, and a constantly growing demand.

Feel free to DM me for one on one discussion. . .

sportsguy

[jedalton]

Believe it or not I am asking for a rather wealthy friend who happens to have $1M cash lying around earning him next to nothing and has no ideas on how to invest it. He and I have known each other since junior high and we brainstorm on various matters from time to time. I told him I had no idea and was sitting on a lot of cash myself (not anything like $1M).

Anyway I thought it might generate some creative thinking as I am out of ideas. Stocks and real estate seem at present extremely overvalued to me. Anybody have any possibilities they would care to share?

VTI fund. dollar cost average

[Billy1]

Lot of great ideas, wonder what I should do.

[jedalton]

retired Registered Investment Advisor

[retiredguy123]

Utility ETF, because of the uniqueness of the regulated utility market in this country. Based upon statutes, the utilities are guaranteed a return on assets. With the grid needing to be upgraded to nearly twice its size for the green movement, increased CAPEX means increased profits, and then increased dividends.

These are regulated monopolies, which have guaranteed returns, and a constantly growing demand.

Feel free to DM me for one on one discussion. . .

sportsguy
FYI, here is a link to the Vanguard Investments Utility ETF offering. The current yield is 2.88 percent, but the risk level is rated as 5 out of 5.

Vanguard ETF Profile | Vanguard (https://investor.vanguard.com/etf/profile/VPU)

[jamorela]

Build a homeless shelter

[GOLFER54]

(352) 461-0645 My wife and I have put our money in Annuities’s, 8-14 % a year, depending on the particular investment. We do business with Skip West on CR 44 , across from Brownswood. Good Luck ! IF you do decide to give him a call, he offers a referral program, so use my name Taibi. :-)

[BlueStarAirlines]

I bonds are a great place. Currently earning 3.57% and will go over 6% on November 1st. Can't pull the money out the first year and there is a interest penalty if withdrawn in the first 5 years. The negative? One can only put in $10k a year per person ($20k if married-each need their own account). There is a small loophole where you can invest your tax refund into the I bonds, but that amount is (hopefully) not a huge amount.

Individual - Series I Savings Bonds (https://www.treasurydirect.gov/indiv/research/indepth/ibonds/res_ibonds.htm)

[golden]

Retiredguy123-

A better description of your federal pension would be overly generous, unconscionable, and immoral.

[retiredguy123]

Retiredguy123-

A better description of your federal pension would be overly generous, unconscionable, and immoral.
I don't disagree with you. Federal salaries, benefits, and pensions are too high. It's one reason why the country is $30 trillion in debt.

[Girlcopper]

Believe it or not I am asking for a rather wealthy friend who happens to have $1M cash lying around earning him next to nothing and has no ideas on how to invest it. He and I have known each other since junior high and we brainstorm on various matters from time to time. I told him I had no idea and was sitting on a lot of cash myself (not anything like $1M).

Anyway I thought it might generate some creative thinking as I am out of ideas. Stocks and real estate seem at present extremely overvalued to me. Anybody have any possibilities they would care to share?
Invest in stocks o spend like hell.

[rsmurano]

If you invest your money right, you don’t need to look at it all the time, maybe once a quarter.
Also, it’s safer and more profitable to be in indexed funds like vanguard which you pay a small expense fee (Some of mine have .02 % fee) compared to non-indexed funds with over 1% fees. Don’t buy loaded funds either, upfront or backend, these can be 4-5% or more.
I’ve been doing my own investing for 40 years without a broker and over time I do much better than friends that pay 1-1.5% broker fees because a lot of them sell funds that are best for them (loaded, high expenses) and still don’t make the profit of indexed fund’s overtime.
IMO, if you don’t know how to invest, there are a few brokerage houses that charge very low fees like Schwab’s robo investing (0% fees) or say Vanguard at .4% (check for sure) but you know Vanguard will buy you diversified low cost/low fee indexed funds

[DrRick614]

I have always felt better when I donated to wounded warriors or Tunnel to towers. Helping our hero’s is a great option.

[BlueHeronFan]

Gold
Inflation hedge and inflation is in full swing.

[Luggage]

At this time in your friend's life, he should really be thinking on how to give it away to charity, his relatives, like grandchildren for college education. I hate to be the nudge here. Surely his local church could use some money always. And quite honestly I have a very small charity that I run for Sumter in Lake county's giving away money in the tens of dollars to help local people you can PM me if you really want to, I've given away a baby stroller, helped with furniture, and toys. As far as investments you can always go to Kickstarter and see thousands of ideas people have for new businesses and help them out. Nothing is safe in this world

[Malsua]

Gold
Inflation hedge and inflation is in full swing.

Has there been inflation since 2010?

Had you bought $4000 gold then, your returns would be....-7%.

Had you spent $4000 on bitcoins, you would be a billionaire.

[retiredguy123]

I have always felt better when I donated to wounded warriors or Tunnel to towers. Helping our hero’s is a great option.
I bothers me that the Wounded Warriors Project has 16 employees who each make between $160K and $313K per year. That is more than almost every military officer.

[Tyrone Shoelaces]

I'm not talking about day trading crypto, that's a recipe to get wrecked. Dollar cost averaging into Bitcoin and Ethereum is about as much of a guarantee of a winner as you're going to get. Some of the alt coins are solid too, like Cardano, Tezos and Dot.

We're talking buy and hold sell whenever you're inclined to.

Guaranteed winner??
Some would respectfully disagree..
Warren Buffett: Why You Should NEVER Buy Crypto - YouTube (https://youtu.be/cNh3Wod7JIU)

[CoachKandSportsguy]

FYI, here is a link to the Vanguard Investments Utility ETF offering. The current yield is 2.88 percent, but the risk level is rated as 5 out of 5.

Vanguard ETF Profile | Vanguard (https://investor.vanguard.com/etf/profile/VPU)

The risk level is based upon volatility ranking, which is the co-variance with the market. It is not a fundamental analysis of the industry. If the market index is based upon technology stocks, utilities are the old school, steady but lower growth, and definitely not sexy nor high risk as far as guaranteed rates of return. But ask yourself, what is the world of tech based upon? electrical communication. . . . and what is the latest political populist agenda? green energy. . What's the hardest industry to analyze because its regulated with a completely different basis of competition? utilities. . . I work in one, and see all the commercial finance people come from GE, high tech, etc, and just have a very difficult time re-orienting themselves to the industry, because of its uniqueness of a regulated monopoly.

The offset is that the dividends are tax free, and the industry is guaranteed a return on assets, which will increase with the capex of upgrading the grid for electrification. Its a long term play, for sure. And utilities are not sexy. . there are other reasons which analysts may give more weight which are industry specific and transitory. . there is an interest rate risk which is the overriding risk, as the stock with a stable growth and high dividend rate, has a large influence on interest rates. . . similar to bonds, but it has the ability to grow revenue versus a bond. . .

Vanguard definition of their risk rating:
Vanguard funds classified as aggressive are subject to extremely wide fluctuations in share prices. These funds may be appropriate for investors who have a long-term investment horizon (10 years or longer). The unusually high volatility associated with these funds may stem from a number of strategies.

This is not an industry analysis, this is a mathematical analysis as its a difficult industry to understand versus commercial companies. Which is why I recommended it for the reasons above, its the going forward basis of investment with the government, and is becoming more important for all technology to exist. . . which a retired person should consider when not wanting risk but a nice return.

good luck, its an internet bulletin board with world wide participants, so you have to get through the :blahblahblah: to find a nugget of wisdom. . . this may be one, or may not be, only time will tell. Maybe this is the time for the millionaire to have a meeting with a CFP. . . :)

sportsguy

[Tyrone Shoelaces]

Perhaps today could be the beginning of the pullback some of us have been waiting for.

[Fastskiguy]

Lots of good ideas here and a pretty nice thread so far :)

Is there anything this guy wants or needs that money can solve? Because at some point, even if something isn't "worth it", if you have a pile of money and are old then sometimes it can become "worth it". Different house, upgrades on current house, fancy new car, boat, or other toys. Or maybe convenience....lawn service, house service, some gourmet meals prepared in his home a few times per week, weekly in home massage. Or travel, just buy first class tickets and make the trip fun and easy. Maybe playing some iconic golf courses in the US or going to fancy car shows or whatever.

Then he could use something like Vanguard Personal Advisor Services or similar from Schwab or Fidelity. These are super low cost, wildly diversified investments that are going to do just fine and are easy. Like....really easy.

And then as some have mentioned, a few bucks in cryptocurrency and metals might be worth it too. You could put $50-100K in metal and crypto just for fun.

Kinda interested in this forestry option...what is that?

Joe

[airstreamingypsy]

Spend it. Buy that car you always wanted. Take a trip. You are presumably older, and you can't take it with you. Buy a second home in the mountains.

[LuckyS]

Does he have other assets? Does he need this money to survive? What are his risk/rewards attitudes? If he doesn't need the money, why not just leave it alone? Of course he's earning zero.nothing but he not paying much in taxes either.

Believe it or not I am asking for a rather wealthy friend who happens to have $1M cash lying around earning him next to nothing and has no ideas on how to invest it. He and I have known each other since junior high and we brainstorm on various matters from time to time. I told him I had no idea and was sitting on a lot of cash myself (not anything like $1M).

Anyway I thought it might generate some creative thinking as I am out of ideas. Stocks and real estate seem at present extremely overvalued to me. Anybody have any possibilities they would care to share?

[irishmen43]

You could donate 50K to me, a struggling homeowner

[TNLAKEPANDA]

He can put some of it into a quality Annuity and get a decent guarantee return of 6-7%

[Joe C.]

GOLD GOLD GOLD 'nuff said.

[fgaba1949]

I invest my excess cash in REITS...look for like ABR etc there are many very good ones that pay over 5 %
Study the past performance of the individual REIT many have done extremely well over the years

[Tyrone Shoelaces]

He can put some of it into a quality Annuity and get a decent guarantee return of 6-7%

NO way in hell.

[Malsua]

Guaranteed winner??
Some would respectfully disagree..
Warren Buffett: Why You Should NEVER Buy Crypto - YouTube (https://youtu.be/cNh3Wod7JIU)

I didn't say guaranteed winner, I said as much of one as you're going to get.

Warren buffet will tell you to put 90% in an index fund, 10% in a money market and forget about it. I agree with that too. If you recall, up thread, had you read my earlier post, I suggested 1%. $10,000. Chances are better than even that $10,000 in Crypto today will be triple that by next year. It could go to zero too though, which is why I would never suggest anyone put more than 1% of their net worth in Crypto. Only what you are willing to lose, utterly. If you have a million in cash laying around, a 10k loss won't cripple you.

If you want something 100% safe, get a pile of gold and scrooge McDuck it. Be careful though...Peter tried that: Family Guy - Dive Into Gold Coins [HD] - YouTube (https://youtu.be/viDL2W0HcJw)

[NorineBerlinski]

I’m doing an 8 week class at my house titled “Moving from success to significance in your retirement years“.
All the possessions and money we have were given to us by God and he has a purpose for them and for each of us. Come to this class and find out how to use your knowledge from school, the skills you have developed by working over the years and your God-given talents for some thing that will be significant enough to outlast your life. message me for more information, the class will change your life! It’s free.

[JustRita]

Believe it or not I am asking for a rather wealthy friend who happens to have $1M cash lying around earning him next to nothing and has no ideas on how to invest it. He and I have known each other since junior high and we brainstorm on various matters from time to time. I told him I had no idea and was sitting on a lot of cash myself (not anything like $1M).

Anyway I thought it might generate some creative thinking as I am out of ideas. Stocks and real estate seem at present extremely overvalued to me. Anybody have any possibilities they would care to share?

He needs to find a financial manager that operates as a fiduciary.

[herremans]

believe it or not i am asking for a rather wealthy friend who happens to have $1m cash lying around earning him next to nothing and has no ideas on how to invest it. He and i have known each other since junior high and we brainstorm on various matters from time to time. I told him i had no idea and was sitting on a lot of cash myself (not anything like $1m).

Anyway i thought it might generate some creative thinking as i am out of ideas. Stocks and real estate seem at present extremely overvalued to me. Anybody have any possibilities they would care to share?

if you e-mail me back i will send you some links to pursue

[tvbound]

He needs to find a financial manager that operates as a fiduciary.

Best answer.

[Uphillputt330]

What’s important to do is to figure out when, if ever, the investor will need/want the money and, of course, their risk tolerance.

If he/she truly will never need the money and intends to pass it along to heirs, they should take the long term perspective of the heirs and invest in a more risky investment — stocks (diversified) and or real estate.

Short term investments with a less risk tolerance might include a Ginny Mae fund (which yields a bit better the treasuries or bank CDs)

[shirleyjerez]

Call Dale Cebert. Financial Adviser.
Excellent.

[Tbrazie]

Believe it or not I am asking for a rather wealthy friend who happens to have $1M cash lying around earning him next to nothing and has no ideas on how to invest it. He and I have known each other since junior high and we brainstorm on various matters from time to time. I told him I had no idea and was sitting on a lot of cash myself (not anything like $1M).

Anyway I thought it might generate some creative thinking as I am out of ideas. Stocks and real estate seem at present extremely overvalued to me. Anybody have any possibilities they would care to share?
I am a very experienced private investor. Any answer is not useful without knowing much more. Ages any current pensions tax bracket etc I am outside the country presently but we could talk over coffee later this week. I do not sell anything. I am retired AF Colonel. This would just be a discussion so you would know the choices and risks. 6035910585 after Friday

[DeeCee Dubya]

ExxonMobil (XOM) paying .87 per quarter dividend. Strong growth potential in the share price too.

Energy demand going higher no matter what the Biden adm. spews about our cheapest, cleanest and most reliable source of BTU’s. They live in a fantasy world where Western Civilization can be powered on soybeans and baby farts.

[Gigi3000]

Tell him to spend 1% of it on Crypto. Stick to the top ten or so, BTC, ETH, ADA, XTZ, LTC, DOT, etc. Most should go into BTC and ETH though.

If it goes on a bull run and it should, it'll triple pretty quickly. Could go to zero, but chances are not good for that to happen.

Is there an index fund for that? :)

[Old Bob]

Believe it or not I am asking for a rather wealthy friend who happens to have $1M cash lying around earning him next to nothing and has no ideas on how to invest it. He and I have known each other since junior high and we brainstorm on various matters from time to time. I told him I had no idea and was sitting on a lot of cash myself (not anything like $1M).

Anyway I thought it might generate some creative thinking as I am out of ideas. Stocks and real estate seem at present extremely overvalued to me. Anybody have any possibilities they would care to share?

Invest in several solid tax free municipal bonds. They bring in a nice regular income completely tax free.

[Jude55]

If I had an "extra" million bucks, I'd probably just spend it. Or give it away, or donate to causes of personal interest. If it's "extra" it's because I already have enough that I don't have to worry about any upcoming expenses.

Might renovate the house, renovate my sister's house, do some travelling, buy a new car.

It would also depend on how old I am when I get this extra million. If it's now, at age 60, I'd sink a bit into some ordinary bank accounts so I can have cash in case of emergency. Pull the maximum out of the accounts every year to pad my IRA or whatever this thing is called that I invested in years ago every year until I'm old enough to be required to withdraw some.

If I'm already in my 80's, screw saving, screw investing. I'd spend it all on living as well as I can for the next 10 years. Maybe even get a face lift!
I love it

[Lwalgren]

Where & when is this class? We are coming down October 13.

[virtualcynthia]

Wildwood HS needs football uniforms and a new track. It might be a naming opportunity.

On the other side, my friend is investing in high income rental property in Lake Nona, Orlando. The medical campus there is a good customer and with Disney moving jobs from California this seems to be a good relocation area.

[Carla B]

It's at times like this that I miss Chatbrat. He'd have some ideas.

[zendog3]

A person our age with a million not being used will live the rest of their life in financial security. They might invest it, and die with two million in unneeded money. Or, they might give it away. If it were me, I would rather die with no money and a thousand children with college scholarships. I would think this would be the best thing I could do with what is left of my life to make my existence here meaningful.

[JMintzer]

A person our age with a million not being used will live the rest of their life in financial security. They might invest it, and die with two million in unneeded money. Or, they might give it away. If it were me, I would rather die with no money and a thousand children with college scholarships. I would think this would be the best thing I could do with what is left of my life to make my existence here meaningful.

"Unneeded Money"? According to whom?

Maybe they want to fund their OWN grandchildren's college education, or help them buy their first home...

[Tom M]

Has there been inflation since 2010?

Had you bought $4000 gold then, your returns would be....-7%.

Had you spent $4000 on bitcoins, you would be a billionaire.



Where did you get your gold price data? I believe gold was about $1,100/ounce in 2010 and is (as I write this) $1,763/ounce.

[Blueblaze]

A million bucks sounds like a fortune.

Withdrawing $40K/year in a 5% inflation environment, while making 0.3% in a government-insured savings account, it lasts 18 years. Add in his Social Security check, and he's probably good for life. Why risk anything?

Because, if he put it in a "balanced" portfolio like RetiredGuy123, he probably wouldn't even touch the principal, and his kids get rich some day.

Of course, that assumes there's not another crash like the four we've all seen in our own lifetimes that took 50% off the table. I had a widely diversified bond portfolio during the Covid crash just last year. It lost 15% IN ONE DAY. So much for "bonds are safe". No matter where you put your money, you're exposed to the dumbassitude of the dumb masses.

Let's say you've got a balanced portfolio making 7% overall, and there's a 50% crash in 2022. That 4% you can't stop withdrawing will eat up that nest egg in 20 years -- about the same as if you didn't risk anything.

Of course, this all assumes that the FED is successful at holding their new inflation target of 5%. Most of us are old enough to remember the last time inflation hit 5%. It went to 20%. I bought my first house at the end of the Johnson-Nixon-Carter inflation. It cost me an 18% mortgage for Reagan to put an end it.

What does 20% inflation do to your million dollars if it takes 20 years to find a man with the guts to end it? Invested, it's gone in 11 years, or 8 years in cash.

So the answer is gold, right? Really? How safe is a million dollars worth of gold stacked in your closet? OK, so buy stock in a company that claims to stack GLD in a bank. Now we're back to the dumbassitude of dumb masses problem.

Crypto? Seriously? You'd put your life savings in a made-up currency backed by imaginary numbers in a computer, that's not recognized as currency anywhere in the world, and can swing 50% in a month? Have you considered the "red/black" option at Vegas? Less risky and more fun!

The only thing I know of that holds value in an inflation is THINGS. Like REAL ESTATE.

Put a third of that million in real estate and leave the rest in cash. In 11 years, when the cash is almost gone, sell the real estate for 3 million. If nobody fixes inflation, you're good for another 8 years, which is probably enough. On the other hand, if inflation never gets out of hand, cash in your real estate in 15 years and it'll last another 10. More than enough. And if we ever again see 2% inflation, it lasts forever, as far as you're concerned.

But if you're like most of us who don't have a million bucks in the bank... good luck with that! If this country ever sees 20% inflation again, it'll probably go to 2000% in no time, and a stack of bullets in your safe will do you more good than a million in gold. But under that scenario, you could probably save yourself a lot of trouble by just buying one for yourself and one for the missus.

[noslices1]

He COULD double it if he goes to Vegas and puts it all on BLACK at the roulette wheel, but has a 50/50 chance of losing it too.

[Boomer]

Believe it or not I am asking for a rather wealthy friend who happens to have $1M cash lying around earning him next to nothing and has no ideas on how to invest it. He and I have known each other since junior high and we brainstorm on various matters from time to time. I told him I had no idea and was sitting on a lot of cash myself (not anything like $1M).

Anyway I thought it might generate some creative thinking as I am out of ideas. Stocks and real estate seem at present extremely overvalued to me. Anybody have any possibilities they would care to share?


Your friend probably. . .

— Has a paid for roof over his head. (at least one)

— Does not make car payments or any other interest payments.

— Has established, dependable cash flow from income producing stocks, pensions, SS, etc.

— Does not let himself get into the position of having to sell stocks to pay taxes.

— Has a good longterm care policy (even though the company might now be playing chicken with the annual raising of rates) Or feels he can comfortably afford out-of-pocket care if the need arises. Or can buy into the highest rated CCRC he can find, if he so decides while he is still independent.

— Can project ongoing and increasing expenses like insurance, property taxes, etc., and feels like he’s got it covered without worrying.

— Can cover the things he enjoys doing with his disposable income.

— Makes sure to manage potential income tax hits — like if he has to take RMDs and is charitably inclined, uses QCDs to not add the amount of the charitable contribution to taxable income. ( and probably other things he knows far better than I do about paying attention to consequences or advantages of tax decisions)

— And, of course, is galled by that money sitting idle, but has divided his assets by the number of years he thinks he might have left and is wondering if he should just get over it and continue to maintain that moat of cash just like it is — however cringeworthy that might feel. What’s it worth to him — in subjective ways beyond ROI?

Meanwhile, you guys need to watch Consuelo Mack on her show WealthTrack on PBS. (gasp. ;) ) A look at her website wealthtrack.com will show some of her weekly interviews with some big deal investors. You will not get any direct advice — well, maybe some suggestions — but her 1/2 hour interviews will give you some things to think about. . .and nobody yells or rings bells or is mad.

Boomer

[BlackhawksFan]

If that amount of money is just sitting around, why not start a foundation for families or people in need. I know firsthand that Covid has hurt a lot of people financially. Many, including my family, are struggling to make the mortgage, pay the electric bill and buy groceries. If it wasn't for St. Vincent de Paul Society at St. Timothy's and the Salvation Army of Sumter County we'd be sitting in the dark. Sometimes giving a family $2,000 or $2,500 gets them through those rough times. Maybe look at giving to the two organizations I mentioned they both do good work.

[waynehal55]

Utility ETF, because of the uniqueness of the regulated utility market in this country. Based upon statutes, the utilities are guaranteed a return on assets. With the grid needing to be upgraded to nearly twice its size for the green movement, increased CAPEX means increased profits, and then increased dividends.

These are regulated monopolies, which have guaranteed returns, and a constantly growing demand.

Feel free to DM me for one on one discussion. . .

sportsguy

I love Utilities, Vanguards utility ETF is VPU, very low cost and now yielding close to 3.00%. Today the Dow is down over 500, but VPU is up a fraction.

[Malsua]

Where did you get your gold price data? I believe gold was about $1,100/ounce in 2010 and is (as I write this) $1,763/ounce.

You're right, I meant 2011. In September of 2011 it was $1854/ounce. It's still not that today.

If you had purchased gold in November of 2010 and still had it in 2013, at no point until 2019 could you have sold it for anything but a loss.

Gold is generally a good store of value and if uncle fed keeps pumping trillions more, it'll hold it's value. That said, it's a hedge and not a particularly good one. Real estate is a much better hedge.

I think everyone should hold some PM, but like 5% at best.

[Olsenfiber]

Check out series I savings bonds. You have to buy them directly from the Federal Government by opening an account @ TreasuryDirect - Home (http://www.treasurydirect.gov).
You are limited to $10,000 per person/ year, but you can buy them for your spouse/kids/grandkids, etc. They currently pay 3.5% interest. You have to hold them for at least one year, but can cash them any time after that. If you cash them before 5 years, you lose 3 months of interest. Principal is always safe. They will earn interest up to 30 years. Essentially zero risk.

[HORNET]

Sounds like a Ponzi Scam

[jimjamuser]

Believe it or not I am asking for a rather wealthy friend who happens to have $1M cash lying around earning him next to nothing and has no ideas on how to invest it. He and I have known each other since junior high and we brainstorm on various matters from time to time. I told him I had no idea and was sitting on a lot of cash myself (not anything like $1M).

Anyway I thought it might generate some creative thinking as I am out of ideas. Stocks and real estate seem at present extremely overvalued to me. Anybody have any possibilities they would care to share?
Not a good time to jump feet 1st into the Market. It is too high and due for a correction downward! Buy an ETF for bonds with 50% and leave the rest in cash or some money market. Re-evaluate that on Jan 15, 2022. Meanwhile, go to the Village investment club if that is STILL in existence. Do NOT pass GO, do NOT collect $200 or whatever that IS NOW with inflation ( and LEARN the definition of constant dollars). Time WAS your investment friend when you (we) were young - not SO MUCH now.

[HORNET]

Exactly

[CoachKandSportsguy]

I think everyone should hold some PM, but like 5% at best.

If gold was that good, it would be higher than it is. .

If you want a longer term hard asset equity play, look at rare earth metals, which will have a high demand as the battery demands increase. . Of course, these have some chinese names as China has been trying to extort some African countries to give up their mines and metals in exchange for roads, etc.

Just another long term, small amount, 2% or so, portfolio which can add alpha over the long term

futuristic guy

[Tdroels]

SOXL - I would buy a million of this stock today since it is down and watch it GROW. please send me commission check a year from now.

[waynehal55]

I bothers me that the Wounded Warriors Project has 16 employees who each make between $160K and $313K per year. That is more than almost every military officer.

You are correct, that's why I stopped my donations many years ago.
I added Tunnel to Towers to my list of charities, the CEO does not get a salary.

[Tkbonesdir]

Believe it or not I am asking for a rather wealthy friend who happens to have $1M cash lying around earning him next to nothing and has no ideas on how to invest it. He and I have known each other since junior high and we brainstorm on various matters from time to time. I told him I had no idea and was sitting on a lot of cash myself (not anything like $1M).

Anyway I thought it might generate some creative thinking as I am out of ideas. Stocks and real estate seem at present extremely overvalued to me. Anybody have any possibilities they would care to share?

Side question… do you play D1 Softball?
Eddie

[Fastskiguy]

5 pages and counting. I'm a bit surprised nobody has suggested hookers and blow yet ;) (Oops, can we say that here?)

Joe

[manaboutown]

Utility ETF, because of the uniqueness of the regulated utility market in this country. Based upon statutes, the utilities are guaranteed a return on assets. With the grid needing to be upgraded to nearly twice its size for the green movement, increased CAPEX means increased profits, and then increased dividends.

These are regulated monopolies, which have guaranteed returns, and a constantly growing demand.

Feel free to DM me for one on one discussion. . .

sportsguy

Thanks, Coach. Your suggestion makes sense to me - especially in view of today's market movement.

[manaboutown]

At this time in your friend's life, he should really be thinking on how to give it away to charity, his relatives, like grandchildren for college education. I hate to be the nudge here. Surely his local church could use some money always. And quite honestly I have a very small charity that I run for Sumter in Lake county's giving away money in the tens of dollars to help local people you can PM me if you really want to, I've given away a baby stroller, helped with furniture, and toys. As far as investments you can always go to Kickstarter and see thousands of ideas people have for new businesses and help them out. Nothing is safe in this world

He is quite generous. After all, he did set up the $3M charitable remainder trust. He donated what it took to establish a park to his community; he supports its symphony, his church and his alma maters, the University of New Mexico and Stanford. His postcard collection which is huge and concentrates on historic Route 66 will go to the Zimmerman Library at UNM upon his death. He has a surgeon daughter and an attorney son so no needs there or for his grandchildren.

[manaboutown]

A person our age with a million not being used will live the rest of their life in financial security. They might invest it, and die with two million in unneeded money. Or, they might give it away. If it were me, I would rather die with no money and a thousand children with college scholarships. I would think this would be the best thing I could do with what is left of my life to make my existence here meaningful.

Great suggestion, thank you! I will suggest he fund one or more engineering scholarships at his bachelor's degree alma mater!!!

[jimjamuser]

I have almost all of my assets with Vanguard Investments. 40 percent in the S&P Index Fund, 30 percent in intermediate and short term bond index funds and their high yield corporate bond index fund, and 30 percent in the money market fund. I hate that the money market fund pays almost zero interest, but at least the principal is safe. I also have a very generous Federal pension, which provides all of my living expenses, so my investments are probably too conservative. I would be interested in any ideas on where to move my money market fund assets to earn more than nothing, with a low risk of losing principal.
Free advice, since it was asked for.......buy either or both of these ETFs.....symbols BND and BNDX

[jimjamuser]

Your last sentence reflects his conundrum - and mine. What can we do with our cash today in the current investment climate?

There is no easy answer.
There are ALWAYS market investment opportunities. But, it is NEVER "EASY"!

[JMintzer]

5 pages and counting. I'm a bit surprised nobody has suggested hookers and blow yet ;) (Oops, can we say that here?)

Joe

I was gonna' post that, but the overlords have me on a short leash... :bigbow::bigbow::bigbow:

[PhillySpecial]

If you have an "rather wealthy" friend who doesn't know what to do with a million dollars, my first suggestion is that (s)he spend some of that money hiring a money manager who manages investment portfolios for a living rather than ask a bunch of retired strangers their advice.

[Jeff Coats]

Believe it or not I am asking for a rather wealthy friend who happens to have $1M cash lying around earning him next to nothing and has no ideas on how to invest it. He and I have known each other since junior high and we brainstorm on various matters from time to time. I told him I had no idea and was sitting on a lot of cash myself (not anything like $1M).

Anyway I thought it might generate some creative thinking as I am out of ideas. Stocks and real estate seem at present extremely overvalued to me. Anybody have any possibilities they would care to share?
The following is my opinion and not to be considered financial advise.

Given the current volatility in the markets due to current world-wide conditions, it makes the most sense right now to be in cash or cash equivalents. I do expect a 40 to 65% drop very soon in the equity and real estate markets, as well as a total bloodbath in the debt markets. By being in cash, you will be able to take advantage of the coming deflation and buy income producing assets at bargain basement prices. If your money is tied up in distressed investments you will miss out on the opportunity. If deflation is not on the horizon, that means that we are currently in the "crack up boom", and it really does not matter what you do if you do not have gold or silver.

[jimjamuser]

ExxonMobil (XOM) paying .87 per quarter dividend. Strong growth potential in the share price too.

Energy demand going higher no matter what the Biden adm. spews about our cheapest, cleanest and most reliable source of BTU’s. They live in a fantasy world where Western Civilization can be powered on soybeans and baby farts.
Quick, tell me how to invest in "baby farts"?

[retiredguy123]

Free advice, since it was asked for.......buy either or both of these ETFs.....symbols BND and BNDX
Thanks for the advice. But, those ETFs are investments in bonds. I already have 30 percent of my portfolio invested in bonds. That is why I have 30 percent in cash. I don't want to increase my bond assets to more than what I already have. Too risky.

[DylanTodd]

Hi Everyone,

Looks like a pretty spirited chat today by a lot of savvy investors! I have seen some advocates about crypto currency speak up today in this group and I just wanted to let everyone know in case you missed it we recently started a crypto club here in the Villages and there are some exceptional people in that group with diverse investing backgrounds. If anyone wants to hop into one of our virtual or in person meetings reach out to me directly.

Cheers,

Dylan

[oneclickplus]

Believe it or not I am asking for a rather wealthy friend who happens to have $1M cash lying around earning him next to nothing and has no ideas on how to invest it. He and I have known each other since junior high and we brainstorm on various matters from time to time. I told him I had no idea and was sitting on a lot of cash myself (not anything like $1M).

Anyway I thought it might generate some creative thinking as I am out of ideas. Stocks and real estate seem at present extremely overvalued to me. Anybody have any possibilities they would care to share?

Buy "put" options on the DOW or Nasdaq. Actually buy leaps that are a year or more out. Can't go wrong. This market will TANK.

[l2ridehd]

Use Vanguard, Schwab or Fidelity. Put 42% in total stock market, 18% in total international stock market, 28% in total bond market and 12% in total international bond market. Re-balance to those percentages every 6 months. Your return will average about 9% a year and your risk profile is very low. Much lower then the S&P or other suggested investments.

Your expenses will be extremely low. With Vanguard they will be less then 1/10th of 1% by using Admiral shares. It’s extremely important to re-balance to those exact percentages. Forces you to sell high and buy low.

[EastCoastDawg]

Believe it or not I am asking for a rather wealthy friend who happens to have $1M cash lying around earning him next to nothing and has no ideas on how to invest it. Anybody have any possibilities they would care to share?

I was disappointed to see how little thinking "outside the box" there was in the responses to this question.

Many people suggested using a professional financial advisor. Not only do I suspect he has thought of that already, and turned the idea down, but also time and again they have been shown to be the worst people to handle your money - taking generous bonuses when the markets are rising anyway, and still taking generous fees when their stock selections are falling.

Others insisted on jumping on the Bit Coin and derivatives bandwagon. Sure, a few have become very wealthy, but many others (including most of Venezuela) are setting themselves up for a fall.

Let's have some revolutionary ideas, people!

[manaboutown]

I was disappointed to see how little thinking "outside the box" there was in the responses to this question.

Many people suggested using a professional financial advisor. Not only do I suspect he has thought of that already, and turned the idea down, but also time and again they have been shown to be the worst people to handle your money - taking generous bonuses when the markets are rising anyway, and still taking generous fees when their stock selections are falling.

Others insisted on jumping on the Bit Coin and derivatives bandwagon. Sure, a few have become very wealthy, but many others (including most of Venezuela) are setting themselves up for a fall.

Let's have some revolutionary ideas, people!

He has used a few different financial advisors in the past as he has owned stocks for many years. Although he researched them to some degree using Barron's advisors lists they have performed at best no better than the S&P and usually worse. He does own index funds as well as individual stocks but does not want to add to his securities portfolio in today's frothy market.

[CoachKandSportsguy]

Although he researched them to some degree using Barron's advisors lists they have performed at best no better than the S&P and usually worse.

So asking a CFA/CFP to beat the market is a very difficult task, as very few can do it without some sort of informational/forecasting/trading edge. So that is one strike against your friend's expectations and past experiences.

Second, since so very few can actually do it, if his goal is capital appreciation and the S&P is his benchmark for success, the only other way to outperform that index is to market time that index. He can pay someone to perform that market timing for him from a very highly rated market timing service, but only if that is his goal. Check out Mark Hulbert's Market Timer results, and I subscribe to the top timer, and it is possible, but requires work and dedication to follow

Third, if the goal is hands off, non emotional investing, I would recommend
O'Shaughnessy Asset Management (https://www.osam.com/)

The investment industry is huge, and some are not widely advertised on main stream media, so you have to do some "research" to find the best match for your goals. . . and that most likely means knowing how to get around search bias and SEO optimization for your ip address and cookies.

But as many have said on here, we don't know the personal goals for the money, and only he can articulate that, to be matched up with the best advisor. . .

good luck. .

finance guy

[Boomer]

Use Vanguard, Schwab or Fidelity. Put 42% in total stock market, 18% in total international stock market, 28% in total bond market and 12% in total international bond market. Re-balance to those percentages every 6 months. Your return will average about 9% a year and your risk profile is very low. Much lower then the S&P or other suggested investments.

Your expenses will be extremely low. With Vanguard they will be less then 1/10th of 1% by using Admiral shares. It’s extremely important to re-balance to those exact percentages. Forces you to sell high and buy low.


Hey, ride, :)

When I see your posts about your index fund approach, I always think that when the market drops, I just might tiptoe into some index funds with a little cash I will take from the moat. But, for now, I remain the, merely adequate, manager of the BoomerFund. (The girl can't help it. It's how I'm wired. Mr. Boomer has no complaints though.)

I have interviewed a few advisors and found one in my hometown that I liked, so maybe someday I will give him a call. But, you know that thing where they get 1% annually, taken quarterly. Well, that kind of unnerves me a little because it is not 1% of any gotten gains. It's 1% of assets under management. Therefore, they get paid in any kind of market. Of course, I don't expect them to do charity work, but, for now, I feel better just taking care of business myself.

Even with our parking place at one of the bigguns, we keep total control of the investments -- which is what you are doing with your funds at Vanguard. We have not used funds since our employer retirement accounts made us (mostly) while we were still working, but that does not mean that I don't keep a few funds on my radar.

I have been at it for decades though, and I know I am a rather unusual "old lady" who has surprised the heck out of a whippersnapper or two who has tried to buy me dinner first. But I have a backup plan if I ever lose interest in doing this myself -- or if anybody close to me sees that I better not be. (So far though, I have not gone crypto, nor am I hanging out on Reddit. I learned quite well from the mistake I made as a bubble dancer in the 90s. Fortunately, I had not bet the farm -- just the butter and egg money -- but still -- UG!)

I caught on fast after my bubble-dancing days and became a firm believer in the "Buy What You Know" philosophy. For instance, one day, about 4 and 1/2 years ago, Mr. Boomer saw me on my laptop doing a little shopping. . .

"Whatcha doin'?" he asked.

"Just lookin'," said I.

"Look at Garmin," Mr. Boomer said. (And then he went into some big explanation of airplanes needing Garmin. Well, I tried to look fascinated. Pilots like to talk about airplanes and when outside they are always looking up. I am used to it. Anyway, I took his advice. I looked at Garmin. I bought. And I am glad I did. That one was a classic "Buy What You Know.")

manaboutown, this thread is fun. I can never talk like this with people who actually know me. I am from that neck of the woods where we just do not ever talk about money. Ah, the freedom Boomer, my alter-ego, has found, throughout all these years, on TOTV -- even though I still try sometimes to break up with it. :)

Boomer

[Boomer]

FYI

For anyone who is following this thread and might be interested:

The Investment Education Club is having a Zoom meeting on Thursday, 9/23, at 3:00. This will be a dividend discussion.

If you want more info on this Villages club, you can google Villages Investment Education Club to find the website. Meetings are on the 2nd and 4th Thursdays from 3:00 to 4:30. Topics of discussion vary widely, but they always send an email to let you know what's on.

Boomer

[Shirleyq]

Barndollar Investments has done well for me. I have been with them for 6 yrs now with out a problem. Hobby will come to your house. He has many different types of investments. Do to my age I prefer monthly income from my investments.
727 834-2000 or 727 478-0263.
Shirley

[kkingston57]

A lot of un answered ?s. No mention of persons age and his current portfolio. Appears he is wealthy and looking to invest 1Mil in cash. Does the wealty part include the cash or is cash over and above the Wealthy. Stocks were at highs 3 weeks ago and have been declining past 3 weeks(600 points on 9/20).

Personally I am invested in preferred stocks which pay out 5-6% a year. My broker tells me that this enables him to sleep well at night.

Need to check his risk taking before committing.

[manaboutown]

A lot of un answered ?s. No mention of persons age and his current portfolio. Appears he is wealthy and looking to invest 1Mil in cash. Does the wealty part include the cash or is cash over and above the Wealthy. Stocks were at highs 3 weeks ago and have been declining past 3 weeks(600 points on 9/20).

Personally I am invested in preferred stocks which pay out 5-6% a year. My broker tells me that this enables him to sleep well at night.

Need to check his risk taking before committing.

My friend and I are the same age, 79; 80 is fast approaching. He has no interest in actively trading or even managing a portfolio. While $1M is not the world to him it is not pocket change either. He wants to put it to work and not at great risk. He is a "Millionaire Next Door" kind of person. He (and I) still own and operate businesses and are reluctant to sell them. His father died at age 84 still running the same business which my friend many years ago inherited in part, buying out his siblings.

[steve3860]

Believe it or not I am asking for a rather wealthy friend who happens to have $1M cash lying around earning him next to nothing and has no ideas on how to invest it. He and I have known each other since junior high and we brainstorm on various matters from time to time. I told him I had no idea and was sitting on a lot of cash myself (not anything like $1M).

Anyway I thought it might generate some creative thinking as I am out of ideas. Stocks and real estate seem at present extremely overvalued to me. Anybody have any possibilities they would care to share?

I flip a house from time to time. Right now I'm paying a point a month for the money. Max loan time is 6 months. I put the money up for all repairs. It's a good return on the money

[Boffin]

Three investment ideas/thoughts:

1. AST Spacemobile, Inc. (stock symbol: ASTS) engages in the building global broadband cellular network in space to operate directly with standard, unmodified mobile devices based on extensive IP and patent portfolio. The company's team of engineers and space scientists are on a mission to eliminate the connectivity gaps faced by today's five billion mobile subscribers and finally bring broadband to the billions who remain unconnected. The company was founded on May 31, 2017 and is headquartered in Midland, TX.

2. Precision Medicine - an emerging approach for disease treatment and prevention that takes into account individual variability in genes, environment, and lifestyle for each person.

3. Infrastructure - basic physical systems of a business, region, or nation. Examples of infrastructure include transportation systems, communication networks, sewage, water, and electric systems. These systems tend to be capital intensive and high-cost investments, and are vital to a country's economic development and prosperity.

[Boffin]

I doubt that there has been any significant change in the past 10 years.
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