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What to do with $200k

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  • What to do with $200k

    I have $218K in cash sitting in money market accounts (earning 2% right now).  I started my own practice a year ago and so stocked away a large amount of money. The practice is thriving, and we have paid back the practice loan. Now what do I do with all this cash?

    176K left on mortgage at 3.625

    No other debt

    401ks/Backdoor Roths/HSAs fully funded

    $1.6 in Index funds (partially retirement and taxable account)


    Both of our cars are about 10 years old. Husband wants a 100k tesla. I like my old car.

    Should we pay off the house, buy more index funds (market seems so high though!) or do some other type of investments. I've looked at MLG and Origins.


  • #2
    Cashier's check to DMFA, please.

    You should have a sizable sum sitting liquid for limited-opportunity investments, especially if you own your own business and your revenue drops, you have an expense that won't be covered by cash flow or insurance, or another emergency.  $200,000 might be a reasonable amount for that cash reserve.

    Not sure what you're doing with $1.60 in index funds.  That's like 1/50 share of VTSAX.  I think you mean $1,600,000...?  If that's the case, do whatever you want.  Buy some properties.  Invest in some private equity businesses.  Buy a car.  Whatever.  You're fine.


    • #3
      529 if needed?

      I would likely buy VTSAX in taxable but if you are worried about the market being high then that might not be for you.


      • #4
        Good problem to have.  Tend to agree with DMFA, maybe have one or two month of savings (payroll/rent) set aside for the practice.  At 10 years, I would certainly think about potential vehicle replacements and have money set aside.  If a vehicle purchase could be staggered a bit say by 2 years, then future financial resources towards cars would ideally be staggered.

        Not a Tesla fan, so can't imagine paying 100K for one of those vehicles.....


        • #5
          Buy the car. Invest the other 100k.


          • #6
            If you have $1.60 in taxable I would put it all in there. If you have 1.6 million I would buy the Tesla.


            • #7
              Buy the car, pay off more of mortgage.


              • #8
                Agree, youll need more than $1.60 for retirement.



                • #9
                  I actually don't think this is good problem to have unless you feel some reason to hold that much idle cash. Its better than a $200K liability but if this had been invested over the period of accumulation maybe it would be $300K+ in assets. I think Jim's advice of having a plan and sticking with it is good because then one never needs to ask these question as you have already answered it for oneself.

                  I don't think anyone's investment plan would be accumulate $200K and then find a good investment to put it all into at once unless trying to meet a fund minimum. Maybe since you are in this situation, you might look around for some limited partnerships that have high minimums.  Otherwise just buy a bunch of index funds or spend on something nice.



                  • #10
                    Sorry, 1.6M in vanguard taxable and retirement savings. Thanks for all the input! Has anyone used MLG or Origins?


                    • #11
                      I’m impressed you’ve replied to a thread you’ve created. First time!


                      • #12

                        Sorry, 1.6M
                        Click to expand...

                        we know. it was a joke....


                        • #13
                          It is less funny when you have to explain it.


                          • #14

                            It is less funny when you have to explain it.
                            Click to expand...

                            i still kinda find it sorta wrong. i was taught million is 1 MM.


                            • #15


                              The biggest Roman numeral is M, for 1000, so one easy way to write large numbers is to line up the Ms: MMMMMMM would be 7000, for instance. This system gets cumbersome quickly. When they needed to work with many large numbers, the Romans often wrote a bar above a numeral. The bar meant to multiply by 1000.