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  • 100k windfall


    36yo hospitalist married with toddlers with 100k cash windfall from inheritance. Only debt is 300k left on 3% fixed 15yr mortgage (quarterly paying extra to reduce principal). No student loans or credit card debt. Cars paid off. Have fully funded emergency fund. Regularly placing money in to 529s, max 401k, and extra to vanguard taxable brokerage. Most of the windfall posts so far say invest between taxable account, 529s, and mortgage payoff. I am looking for something different, perhaps more aggressive. It's rare in IM to have lump sum like this to be able to invest. Live in a medium size city where there is a fair amount of land in my eyes taking away some of the margins I hear for real estate investing (did read through email 2d ago with some interest in real estate options). No real business experience. Need some ideas or advice. Thanks in advance


  • #2
    Do you have an investing plan or IPS? Here why you need one, and here's how to write it. The exercise will help you consider how to invest according to your life & financial goals, and your risk tolerance.

    (e.g. @Queue just wrote one.)

    For some reading to help you ponder potential investments, or side hussles, I'd check out this podcast - better if you can listen to them over reading.

    https://www.whitecoatinvestor.com/passive-income-md-podcast-32/

    Some more ideas here too:

    https://passiveincomemd.com/list-physician-side-hustles/

    ... and if this allows you to add a great new category to your portfolio - great. If it allows you to have a great dinner with the family, donate to charity, and and add a giant pile to your taxable account - that's awesome too. Just be honest with yourself (and significant other) about where your time and priorities may lie.

     

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    • #3
      it sounds like you might be looking for something fancy, i wouldn't do that.

      if i were in your shoes and i got $100k i would probably spend $10k on fun stuff and divide the rest into 529 and mortgage.

      you've done incredibly well, don't get overly complicated.

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      • #4






        it sounds like you might be looking for something fancy, i wouldn’t do that.

        if i were in your shoes and i got $100k i would probably spend $10k on fun stuff and divide the rest into 529 and mortgage.

        you’ve done incredibly well, don’t get overly complicated.
        Click to expand...


        Mmm Good thoughts.

        Keep in mind, given how mortgage interest is front loaded, you'll pay significantly less (overall) for a mortgage if you pay principal off earlier in the life of the loan.


        Using a loan amortization template in Excel, you can see the differences. Having a house paid off 62 months earlier, and savings ~40k in interest is not a bad return on that "investment". There are other options, sure, but given the amount of effort, it's worth considering, or at least accurately comparing against other options (oif which there are many, and some may be better).



         

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        • #5
          Live in a medium size city where there is a fair amount of land in my eyes taking away some of the margins I hear for real estate investing (did read through email 2d ago with some interest in real estate options).

          What does this even mean? Psychologically, you write like a sitting duck about to make a foolish decision. When investors feel quasi-rich, greed leads to heartache. Investing is not about status-whoring or excitement. If that's what you'd like, buy a race-horse, an apartment in Dubai, or a real estate deal where you can call yourself a "preferred" investor. The real estate sharks will eat you alive. You gain wisdom through your losses.
          I recommend spending 5-10% splurging on a family vacation, and then find the most boring vanilla Vanguard ETF to add to your taxable account. Honor your deceased grandparents' memory.

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          • #6
            We had a small windfall after selling a home we purchased at an auction.  I used that as a down payment on a piece of farmland just outside of town.  I will be selling the land to a developer this year at a very large profit.

            If your exposure to "routine" stocks and bonds is significant, I would explore land/rentals/crowdfunded real estate (e.g. realtymogul) as a means of diversification.  If you are just getting started saving, I would probably go taxable/529s.

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            • #7
              @airborne1, Beware reporting bias. Kudos to GXA above, but as usual, only the successful outcomes are reported. Alternative investors with depressing results will not chime in.

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