How would you guys invest that amount of money if
-you want consevative returns
-more aggressive returns
-or if you want to flat out gamble your money and want to double it in a short amount of time

Im sure you'll have questions so ask away

Conservative- individual muni bond ladder
Aggressive- PE fund (most have min of 1M)
Double money quickly- Vegas

WaltonLoads08 said:

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andyv94 said:

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How would you guys invest that amount of money if
-you want consevative returns
-more aggressive returns
-or if you want to flat out gamble your money and want to double it in a short amount of time

Im sure you'll have questions so ask away

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-Bonds
-Stocks
-cryptocurrencies, because gambling is stupid

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Triple net leases
Apartment complexes
Cheap neighborhoods
H&B

Real estate for all 3.
1. Cash flowing property purchased with cash
2. Appreciation play with some cash flow
3. Development play

Next question, what are your relative expectations for return in each of these classes with a 10 or 20 year view?

I'm going to have a roughly $500K asset that I need to 1031.

Well I've made pretty good in real estate but the rental market here in bcs has taken a dive this summer, way way too many new apartment complexes built and being built or proposed. So that for the forsiable future is a no for me.

I love real estate because you are getting a return on your investment plus your creating value, so I like that but the market is saturated right now for us small players. Disclosure, I'm not in the student rental market here in town, I lease my units to young couples or singles out of school.

I'm looking for a yearly return of 3-7% on my investment

Is that all the money you have, or what you're wanting to invest?
Will this be the sole source of income? Do you need some or all of the proceeds from this investment to live?
What's your time horizon for this investment?

What I'm wanting to invest

Wife and I are going sailing around the world for the next 2-5 years so I was hoping that we could use the monthly profit from the $1 mil

Yeah, the CS market seems saturated, but you could easily purchase some turnkey properties in other markets that could make your 3-7% desired rate of return. You could probably qualify as an accredited investor and if so, it would be pretty easy to find a syndicate group to invest in that could provide that return.

After seeing this, I would definitely look into investing into a real estate syndicate group. Many of them target 5 years for fund exits so it would work great with your timeline.

Are there any that you would recomend?

I recommend you invest it with the bank of histag10. I cannot guarantee any returns, and you will likely have losses. But at least you know ahead of time, right?


more serious answer- If I had that kind of money to invest, I would hope to have enough to get into a private bank (3MM I think is pretty much the minimum to open an account), and then use their "boutique" high end investment banker to do my investments, because i'm pretty investment dumb.

Email me your contact info and I'll give you a call.

I'd have a mix of ETFs, bonds and commodities. How much of each depends on current market conditions and comfort level.

I'd be letting a fincancial advisor run with it while I sailed.

Weed trade in CO or WA.

Thanks tony I'll email you in a bit

andyv94 said:

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Crap, I'm only two short

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I think there may be some out there that you can get into with like 250 liquid for investment. But shopping around for a high balance private bank is weird and semi complicated (Not personal experience, work exlerience)

DIY (invest through vanguard - good options with low fees):
"Aggressive" - I would do 40% total international stock index, 40% us total us stock index, 20% us bond index.
"Conservative" - buy the vanguard retirement income fund. It is a mix of 30% stocks, 70% bonds and inflation protected bonds, with an expense ratio of approx 0.15%

If you aren't confident with DIY, I would find a fee based CFP (certified financial advisor) and pay them for their advice, and follow it.

Avoid the allure of "I have a guy at my private bank", because they don't have any super secret investments that the rest of the market isn't aware of.

From reading your posts, I would recommend the financial advisor route.

Cyp0111 said:

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Literally providing some of the worst advise on this board.

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You must have missed where I said I'm investment dumb, so if I had that kind of money to invest, I would go the private bank route to use their investment end.

That is not advice. That is saying I don't know so I would trust someone else.

Wealthfront.com

Private lending (real estate backed). I charge 12-15% interest only and 2-3 points and funds are usually only out for 2-4 months at a time. I loan in first lien position only and up to 70% LTV. Mostly lending to other real estate investors who are fixing/flipping non owner occupied real estate. Funded a $275k, 30 day 'bridge' loan this morning and charged 2% origination (no interest on this one unless it drags out past 30 days).

andyv94 said:

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Well I've made pretty good in real estate but the rental market here in bcs has taken a dive this summer, way way too many new apartment complexes built and being built or proposed. So that for the forsiable future is a no for me.

I love real estate because you are getting a return on your investment plus your creating value, so I like that but the market is saturated right now for us small players. Disclosure, I'm not in the student rental market here in town, I lease my units to young couples or singles out of school.

I'm looking for a yearly return of 3-7% on my investment

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If you already own performing rentals here in town and you plan to go live on a boat, I would just keep the rentals and find a really good property manager. I would also heavily review how the equity in each property is working for you in terms of monthly income. I assume at least some of your property is financed. You might need to sell some properties and use those funds to pay off other loans or refinance and use the funds to either buy new properties or pay off loans on existing properties. Your max return on equity usually comes when a home is newly financed at 80% LTV. The second best usually comes from properties that are paid off free and clear. Loans that sit for a while tend to stink when it comes to calculating ROE. You might have 50% equity in but you are stuck paying the same note you were paying when you had 20% equity. The more you can put that equity to work the better you are.

If you had $800k in free and clear properties, you should be able to count on around $4000 per month of after tax, after management, repairs, etc cashflow. That should be more than enough if you are living on a boat with reduced normal living expenses.

I have some CS houses that fall in to the same type you describe and they are still renting very well. As long as they aren't in student areas, I wouldn't be too worried about them. The demand for starter homes is staying strong and I don't see that going anywhere. They aren't building more of them and a lot of the young couples/ professionals that would like to buy are having to rent.

Sent you a PM.

Question- do you source/manage loans for outside investors? I.e. - could I give you money and you pay me the interest and you retain a fee for management?

I don't have a formal 'fund' so to speak but I can certainly 'broker' and/or split/share in the loans I make. I've done it before where I split the loan 50/50 with another private $ guy and we're both the 'lender' on all of the loan paperwork.

With $1mm, I'd pay off my cars and house (after finishing basement), -$400k, then buy ~3 rentals @200k ea, with left over. I'd take my freed up mortgage and rental income, ~$6k-$7k/mo, and invest over about 10 years, to dollar cost average, then retire. Kids would still be in middle school, and for the most part we'd live the same during those first 10 years, maybe with a few more vacations.

At retiring point, I'd reduce investing by about $4k or so for spending (wife could retire early and have $2k-$3k/mo from pension, or continue working) and continue to invest $2k-$3k/mo for another 10 years, and I'd have a $3mm+ nest egg. During these 10 years, much more traveling and spending. Basically $6k-$7k a month with no mortgage/debt.

After putting kids through college, I'd sell house and downsize, which would net another ~$500k at that time, basically reimbursing me for their college.

Retire at 47 still with relatively young kids, and at 57 have $4mm with kids out of house and through college, and likely getting lots of money upon my death.

I guess that puts it on the conservative side, but why risk a great life for a bit more money that I may never spend anyway?

I would buy dividend growth stocks...KO, PG, LOW, JNJ, PEP, GIS, MCD, T, PM, MO, MMM, CLX, GWW, DOV, ED, AWR, NWN, EV, etc.

These companies pay dividends each year, and raise their dividend each year. The snowballing effect of compounding is awesome.

I manage about 1.2m using a modified Coffeehouse portfolio. The main modification was to lower the bond position.