WSOP Windfall... What is a boy to do?!?! - Page 8

Matt Flynn · #71 06-21-2007, 05:32 PM

Jurollo,

Buy a relatively cheap home you'd like to live in for the next five years. Put at least 10% down. Others may tell you less, f them, stay overwater and buy peace of mind and resistance against spewing cash. Google "home equity line of credit." Put a bunch in that - it's ready cash. Then get a 30-year or interest-only loan on the rest. Keep your living expenses low. Do not buy an expensive house. They're only good if you get a ton of utility out of living there or if you suck at saving money. Home > townhome or condo for appreciation. Watch out for HOA dues and condo association dues.

Consider buying a duplex, but don't buy one in a slum and try not to buy an old one unless it's quite underpriced due to paint-and-carpet issues.

You may be able to put 40K+ aside per year into an IRA as a professional gambler. Very much worth finding out.

And never assume your hired advice - lawyer, accountant, real estate agent, financial planner, etc - knows what he is talking about.

Matt

mntbikr15 · #72 06-21-2007, 05:48 PM

Wow...I had no idea.

Thanks for the replies

Jurollo · #73 06-21-2007, 05:52 PM

All,
I just want to say that I really, really, really appreciate all the advice in this thread. Having the wealth of experience and knowledge the likes of 2+2 is such an amazing asset.
~J

2Fast · #74 06-21-2007, 05:59 PM

I would do what I do first and put that money into 7-day tax free AAA-rated muni funds so you earn a little more juice. Any bank should have this and they are pretty safe and I think you end up earning around a half a percent more on an after-tax basis. Just a thought - it starts to add up with larger sums of money for sure.

Not sure I'd dump it in the stock market these days with the Dow above 13K and long rates continuing to climb past 5%. Also, at some point the economy will slow and default rates will climb a bit but that's probably more of a 2008 issue (I hope).

Not saying stocks aren't a good place to be now, but be careful - a 5+ return risk free is not bad - sure you might get a couple points more from the S&P but given how it's climbed this year I'd be a bit wary.

Benal · #75 06-21-2007, 07:40 PM

Take 50K, learn to daytrade. Take it slow, learn as much as you can. There are lots of great resources/boards on the web.

I'd buy real estate with the rest, buy a nice car and pay off debts.

Congrats btw.

TheMetetron · #76 06-21-2007, 07:44 PM

PM/AIM me if you want about anything specific.

1. Definitely file as a pro and max out your SEP IRA (or Individual 401k depending on what is best for you). This is $45k that goes in before taxes and grows tax free. You can withdraw at 59 1/2 and pay normal income tax on the money.

2. Create an emergency fund and keep it invested in something fairly stable. Vanguard Tax-Exempt Money Market or Vanguard Tax-Exempt Intermediate Term Bond Index if your state is included and you will be making a lot in future years. If not, use the taxable equivalents.

3. Invest the rest in Vanguard Tax-Managed Index Funds if you don't think you will need the money within 5 years. If so, look for more stable investments (bonds, money market, etc).

4. All of these people telling you to immediately buy a house have close to know idea what they are talking about. Look in BF&I for recent talks about housing as an investment. While most people are blinded by the last 15 years or so, historically housing isn't returning much, if anything, after being adjusted for inflation. That doesn't mean there aren't benefits and it isn't right for some, but it isn't very cut and dry and will require you to do some research and number crunching.

5. A lot of financial advisors are borderline worthless and definitely don't give your money to someone to manage at some ridiculous 1% fee or whatever. Do it yourself with Vanguard or other low-cost index funds and educating yourself.

TheMetetron · #77 06-21-2007, 07:45 PM

[ QUOTE ]
Take 50K, learn to daytrade. Take it slow, learn as much as you can. There are lots of great resources/boards on the web.

I'd buy real estate with the rest, buy a nice car and pay off debts.

Congrats btw.

[/ QUOTE ]

This would be an example of bad advice.

Benal · #78 06-21-2007, 07:58 PM

[ QUOTE ]
[ QUOTE ]
Take 50K, learn to daytrade. Take it slow, learn as much as you can. There are lots of great resources/boards on the web.

I'd buy real estate with the rest, buy a nice car and pay off debts.

Congrats btw.

[/ QUOTE ]

This would be an example of bad advice.

[/ QUOTE ]

I'm guessing you're refering to the daytrading? You can make great money if you know what you're doing.

Kneel B4 Zod · #79 06-21-2007, 08:01 PM

[ QUOTE ]
[ QUOTE ]
[ QUOTE ]
Take 50K, learn to daytrade. Take it slow, learn as much as you can. There are lots of great resources/boards on the web.

I'd buy real estate with the rest, buy a nice car and pay off debts.

Congrats btw.

[/ QUOTE ]

This would be an example of bad advice.

[/ QUOTE ]

I'm guessing you're refering to the daytrading? You can make great money if you know what you're doing.

[/ QUOTE ]

he was probably referring to your whole post

Benal · #80 06-21-2007, 08:14 PM

[ QUOTE ]
[ QUOTE ]
[ QUOTE ]
[ QUOTE ]
Take 50K, learn to daytrade. Take it slow, learn as much as you can. There are lots of great resources/boards on the web.

I'd buy real estate with the rest, buy a nice car and pay off debts.

Congrats btw.

[/ QUOTE ]

This would be an example of bad advice.

[/ QUOTE ]

I'm guessing you're refering to the daytrading? You can make great money if you know what you're doing.

[/ QUOTE ]

he was probably referring to your whole post

[/ QUOTE ]

So you're telling me that renting, buying a POS car and not paying off debts are better alternatives?