Need Help w/ $1.2 Mil

[ThePost]

You said in another post that your wife spends some of her extra money on purses and extra things like this. Have you thought about what you will do with the monthly "rent/mortgage" money that can now go to something else? This might be a good way of proving to your father that you want to pay off the house for financial reasons and not because your lazy. If you have a plan to put the monthly "fake mortgage" payment into XYZ. I'm not sure where you would want to put this money though.

[NotWorthy]

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You said in another post that your wife spends some of her extra money on purses and extra things like this. Have you thought about what you will do with the monthly "rent/mortgage" money that can now go to something else?

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We wouldn't be buying purses, that's for sure. Seriously though, it's not like she buys a ton of frivolous stuff. But to me, and I assume most guys with a woman in their lives, anything she buys that we both can't use sucks and is a waste of money.

Haircuts (I spend $10 every 2-3 months), Nails (is there anything more gay?), tanning (ok, that might be more gay)purses, outfits, whatever, it all sucks. I'm aware she doesn't overdo it, but I still hate all of it, and she knows I hate it, so she definitely does it a lot less than she would want to.

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This might be a good way of proving to your father that you want to pay off the house for financial reasons and not because your lazy. If you have a plan to put the monthly "fake mortgage" payment into XYZ. I'm not sure where you would want to put this money though.

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Good point. About $350 would go to property taxes and insurance on a monthly basis, which is about half our current rent. I would have no problem throwing $500 a month into something extra though.

[MonarchDon]

In my opinion your father did you a favor by not telling you about your money until you were 30 years old. Some may take offense to this but there is alot of growing up to do between 18 and 30, trust me I know. Your Dad is conservative and concerned about you and your financial future. Explain to him you would like to use a percentage of the money to payoff your debts (give him a detailed list)and a percentage to buy a home to raise your family. Be upfront and honest with him about your desire to be debt free. Also explain that you would like to manage a percentage of your money yourself and for him to continue to manage the rest for you but with your involvement.

As others have suggested, you don't have to do anything right now with the money, but I would start the communication with your father and get a game plan started.

Good Luck

[dc_publius]

Doing your research and gathering ideas is a great first step. Financial planning is complicated and there are different competing theories on many issues. The more money you have, the more complicated it gets.

Reading the other thread, I get the impression that your dad is well versed in all the aspects of your financial situation AND he's genuine and looking out for your best interest. Unless you really don't want him to be in your business, I can't think of a better financial advisor. Once you take official control of the money, it sounds like you want to follow what he says anyway.

Essentially, I would use him as a resorce instead of treating him like anchor. I'm sure that if you asked him for some reading suggestions, etc he would welcome your questions and interest. Get together for weekly/biweekly long dinner/lunch and talk some finance. He probably has an interesting story on how he turned the small initial investment into this small fortune. Read some books, pick his brain a little. It's probably not something you guys discussed or pondered about in the past, and it might be beneficial not only from financial standpoint, but also from an interpersonal standpoint.

As I mentioned in the other thread, the likely reason why the money is in Tbills right now is because this money is at the end of it's financial stage before it's handed off to you. Your dad obviously had a timeframe and strategy in mind and he has executed it. (most risky investments at the beginning, least risky investments at the end)

Personally, paying off CC debt sounds like a good first step - and it usually is - but I think it's much more important to figure out why you came to have such high debt and whether the situation has stabilized. Basically, do a good analysis of where you currently stand and what things should be changed... The set clear goals on where you want to be in 1/5/10/20 years. Those goals will define and dictate investment choices.

[Sniper]

NotWorthy...

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Basically, I need to convince my father that the above are good investment decisions to make NOW, as opposed to grinding my way out of debt and saving for a down payment and getting a mortgage and whatnot.

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So you found out you have $1.2 million that you never knew about... and your 1st idea is to spend some of it???

... AND you are upset at your dad!!!

It is certainly clear WHY he didn't tell you about it!


However, the timing of his disclosure raises other issues (quoted from OOT post)...

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I've recently married and my wife and I had our first child a few months ago. Due to my new life situation, my father recommended that he and I go visit with his lawyer to draft up a will.


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All kinds of bells went off in my head when I read this!

What exactly did your dad say to you about why now would be a good time to draft a will?... specifically what did he say about your wife? (and if you didn't discuss this with him, you should have a calm and rational discussion about his concerns)

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Unfortunately, my father casually implied that I am not ready for the "money" (using money although it isn't immediately liquid, so there). A comment from today's luncheon that quickly comes to mind is "You want to make it on your own, don't you?" Another one is "I'll take care of things until you're settled." Settled meaning, not playing p***r for a living (I assume).

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In all likelihood, your father is right... and you should be happy that he's telling you his opinion (whether you like it, or agree with it). Remember, your father is on your side! If there is anyone that knows you, better than you know yourself, its him!

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In conclusion, I have many great and profitable ideas that would put the money to great use, and I do in fact have a right to it, my father made that clear; however, I don't feel worthy of it. To be honest, I would rather not know that I have this money instead of knowing that it's mine and not feeling comfortable "using" it.... To conclude my conclusion, my father may be right, since I'm a p***r player for God's sake. But I'm also a grown-up, and would like to do what's right given my situation, and that is to manage my wealth. I know my father would do a great job manging it himself, since he's done so up to now, but wtf? I wanted to say something cocky like "Let me know when you think I'm ready" or something like that when the day was done, but I love my father and have great respect for him and his accomplishments, and am torn at what's the right thing to do given the situation.

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My recommendation:
1. DO NOT write your father a letter saying you are taking control of the money!
2. DO NOT think about how you can spend it!
3. DO treat the million as a head start on your retirement savings.
3. DO write up a detailed financial plan for where you are today and where you want to get to.
4. DO treat your poker playing as a business.
5. DO explore other opportunities for revenue streams.
6. DO talk to you father about what would make you more "responsible" in his eyes.
7. DO listen to what he says and take it to heart (and go to a few therapy sessions if you need help doing this... there's nothing wrong with doing that!)
8. DO start reading and learn as much as you can about managing your own finances.

The average lottery winner, does not retire rich... Don't join that club! [img]/images/graemlins/smile.gif[/img]

[SoCal11053]

My 2 cents about buying a house. Give it 6 months or a year. I don't know where you live or what area you would think about purchasing in, but I think there is a very good chance that some serious [censored] will be hitting the fan in '06 and '07 regarding price corrections, free wheeling lending practices becoming stricter, ARM loans with teaser rates adjusting (i.e. monthly mortgages going up) for overextended home "owners"
who took a gamble on double digit appreciation going on forever. Things will swing to more of a buyers market in the coming months and you will certainly be finding more motivated sellers in the coming months.

Since you can now afford it, there really isn't any bad time to pay cash for a $250k house and realize the incredible security and piece of mind that comes with a roof over your and your family's head free and clear. But, if you are a little selective and patient you can likely buy on what I believe will be an appreciable dip in the coming year.

[ThePost]

I think this is very market dependent. Everyone knows about the huge increases in Florida and there are other markets going through a similar increases. I'm in Canada and the housing market I'm in is really just starting to boom, with house prices much lower then other parts of the country I would predict it'd be a large mistake to wait to purchase here. (I'm not sure where the OP is or where they would want to purchase a home, but I think he should research it for himself and decide.)

It might not be such a bad idea to wait 6 months or more to make sure that wherever he does buy, he wants to stay for a while. Due to the large closing costs in real estate you generally should plan to stay in the home you bought for a minimum of three years. (If your playing the hot market and flipping then this is different, but that doesn't seem to be the focus of the OP. Having a good home that will aprecaite normally seems to be the goal here.


Best of luck

[mcb]

snipers post is dead on. from your post you dont appear ready for the money. you know nothing about investing and reading the motley fool at 17 doesnt count for anything. i would suggest acting as if you never learned about the 1.2mm. pay off your cc's by working to do so, showing your father you are somewhat responsible.

1 million isnt that much money and from reading your posts and based on the simple fact that your father doesnt want you to have any of it yet tells me that it will be spent very fast.

your father has most of the money in tbills because they are fairly safe and knows you will need every penny of it at some point. he did the speculating when the money was small and is now protecting it. he did a huge favor for you and i suggest letting him decide when you are ready to handle the moeny.

bottom line -- he doesnt trust you.

[lastsamurai]

Pay off your debt.
Are you going to buy a house for investment purposes or to live in? The housing market is over priced right now and is probably going to crash soon. Remember if you are a first time home buyer and you and your spouse havent own a house for 2 years you could put 10K from an IRA as a down payment. Talk to your financial advisor/tax consulant about this tax credit.

ALSO i tell all newbies who post on this site who have questions about books is to get yourself a copy of "HOW TO MAKE MONEY IN STOCKS:" from william oneil.

after reading the book and taking notes get a subscription to how investors business daily and read www.investors.com every day. They have an unbiased stock screening system and the "new america" and the "big picture" is worth the advertisement itself.

[Baulucky]

First thing to realize is that, although many suggestions obtained here are likely correct, you are asking to a group that, on average, have never had $1.2 M to make decisions on.

Stick to your dad's advice for now while you find a better plan.

Some suggestions, as paying off credit card (and possible most other high %) debt, are obvious inmediate choices though that your dad will also approve of.

There's a lot of "self pride" and "sense of accomplishment" generated when you "dig yourself out of a hole". Maybe your father wants you to do that to prove something. I'm just speculating. Keeping those loans is just stupid though.