Advice/Ideas for investing a large amount of money?

[Hotel Detect]

If you had a large amount of money, let's say approximately $35,000,000 USD, what would be the smartest way to invest it?

I am a total novice when it comes to investing, so I am wondering, would you recommend putting it in a money market? (I believe you can earn 3.5% tax-free correct?), hedgefunds? Stock market? Real Estate?

What percentage would you put in each vehicle?

Are financial advisors for major brokerage houses usually trustworthy?

Should some of the money be invested outside of the US in order to protect against a declining dollar? If so what percentage, and where?

Will it be possible to earn approx. 5% after taxes at very low risk?

Are prenuptial agreements enough to protect against divorce settlements?

Answers to any of these questions would be greatly appreciated

Thank you!
_Hotel

[Perplexity]

With $35M, unless you wanted to spend a lot of time dealing with it yourself, you would want to hire an independent financial advisor / manager / planner. Not one from the major brokerage houses -- they charge too much. Not a comission-based one, but instead, a fee-based one.

[ahnuld]

put it all in orange juice.


seriously, use professionals.

[Scorpion Man]

[ QUOTE ]
If you had a large amount of money, let's say approximately $35,000,000 USD, what would be the smartest way to invest it?

I am a total novice when it comes to investing, so I am wondering, would you recommend putting it in a money market? (I believe you can earn 3.5% tax-free correct?), hedgefunds? Stock market? Real Estate?

What percentage would you put in each vehicle?

Are financial advisors for major brokerage houses usually trustworthy?

Should some of the money be invested outside of the US in order to protect against a declining dollar? If so what percentage, and where?

Will it be possible to earn approx. 5% after taxes at very low risk?

Are prenuptial agreements enough to protect against divorce settlements?

Answers to any of these questions would be greatly appreciated

Thank you!
_Hotel

[/ QUOTE ]

If you have anywhere near this much money and are coming to this board for advice, you are going to end up in a world of hurt. You need either knowledge or serious professionals to avoid big screwups. PM me if you are serious...I will get you started on the right track.

[gull]

With so much money, financial advisors are a good option. However, it takes work determining the salesmen from the good advisors. If you like, I can recommend the financial advisors that I believe are the best in the country.

[contortionist]

If you had a large amount of money, let's say approximately $35,000,000 USD, what would be the smartest way to invest it?

Find a very good financial consultant.

I am a total novice when it comes to investing, so I am wondering, would you recommend putting it in a money market? (I believe you can earn 3.5% tax-free correct?), hedgefunds? Stock market? Real Estate?

definitely not money market. hedgefunds can be VERY risky. balanced portfolio of equities (stocks, mutual funds, etc.) and bonds. i would say 70/30 in favor of equities and yes own some real estate but stay away from reits for now.

What percentage would you put in each vehicle?

depends on your personal circumstances. need to discuss with good financial advisor

Are financial advisors for major brokerage houses usually trustworthy?

at large ones they probably aren't going to run off with your money if that is what you mean. but most suck and are little more than glorified salesmen. i have a really good one. you can pm me if you are serious.

Should some of the money be invested outside of the US in order to protect against a declining dollar? If so what percentage, and where?

yes. discuss w financial consultant once again or pm me and we can talk further

Will it be possible to earn approx. 5% after taxes at very low risk?

yes, that is aiming very low though.

Are prenuptial agreements enough to protect against divorce settlements?

NOOOOO!!!!!!!!!!!!! gotta remember that both parties need independent lawyers and you must disclose how much money you have and have evidence of such disclosure otherwise you will get screwed. happened to trump.

Answers to any of these questions would be greatly appreciated

Thank you!

[Hotel Detect]

Thanks for all the replies. Yes I know that a financial advisor is a MUST. I have a very trusted advisor, I am just not sure whether he is too conservative or not,.. he is telling me 5% after taxes with very low risk, I think this sounds good to me (so I should probably go with it then). My main concern is whether I am overexposed to the US dollar, I am going to definitely bring this up next time we talk. We are still in the infancy of putting my plan together.

I realize this isn't the ideal spot to ask these questions I just thought it couldn't hurt.. Can anyone recommend a good financial advise forum? Trust me I am not going to make any rash decisions...

Contortionist.... thank you for your detailed response, especially regarding marriage. I am taking this one to heart as I am getting close to this point in my life. I have already told my GF that if it happens I HAVE TO get lawyers involved because I love her but people do change and luckily she is cool with it.

Also, thanks for the lack of flames... I really just wanted some anonymous advice so that I can compare it against people that might be trying to "play" me.

Once again, Thanks
_Hotel

[Newt_Buggs]

I would definitely take scorpion man up on his offer if I were you. There are few others on this forum suited to offer sound advice for you in your position.

[mntndrew]

What are your income requirements? Say you use Vanguard's intermediate term tax-exempt bond fund, which currently yields 3.77%. If your numbers are accurate, this will generate $1.3M per year in tax-exempt income without touching your principal.

In designing any portfolio, you need to be aware of your need, ability and willingness to take risk. It seems that in your case, your low *need* to take risk should be the dominant factor. In that case, I'd recommend something like 80-90% in bonds -- probably split between short- to intermediate-term tax-exempt bonds and TIPS -- and 10-20% in equities -- split perhaps half and half between a US total stock market index fund and a total international fund.

A financial advisor is not necessarily a must. You'll need to educate yourself to understand what you need to look for in an advisor, and in so doing, you'll likely find that you know enough to feel comfortable handling the investments yourself. You should understand how your advisor gets paid, and how that fee structure may fail to align your fiscal interests with his. As many have indicated above, many financial advisors are nothing more than salesmen, and you need to be very careful about differentiating an advisor from a friend. I found "The Four Pillars of Investing" by William Bernstein and "The Bogleheads' Guide to Investing" by Taylor Larimore, Mel Lindauer and Michael LeBoeuf to be easy to understand and highly instructive introductions to investing that I'd strongly recommend.

I would also suggest trying out http://www.diehardsforum.org for excellent financial advice.

[jively]

[ QUOTE ]
If you had a large amount of money, let's say approximately $35,000,000 USD, what would be the smartest way to invest it?

I am a total novice when it comes to investing, so I am wondering, would you recommend putting it in a money market? (I believe you can earn 3.5% tax-free correct?), hedgefunds? Stock market? Real Estate?

What percentage would you put in each vehicle?
[...]
Should some of the money be invested outside of the US in order to protect against a declining dollar? If so what percentage, and where?

Will it be possible to earn approx. 5% after taxes at very low risk?

[/ QUOTE ]
I have posted before regarding this. I feel strongly that passive (index) investments, balanced and diversified around the world can give you a very good investing experience, with the lowest amount of risk, and immediate liquidity. I am a financial advisor with access to Dimensional Fund Advisors (DFA) mutual funds. I believe DFA is the best mutual fund company out there. Vanguard is the second best mutual fund company out there. Hedge funds, private equity and so on are not necessary to have excellent investment returns with low risk.

The % of stocks depends on your lifetime goals, but just using a balanced 60% stock, 40% fixed, I like an allocation like:

12% US Large Cap
12% US Large Cap Value
6% US Micro Cap
6% US Small Cap Value
6% US REITs
12% International (tilted towards value and small stocks)
6% Emerging Markets (tilted towards value and small stocks)
20% Short-Term Municipal bond funds
20% Intermediate-Term Municipal bond funds

You can use DFA's "core equity funds" and tax-managed funds to lower the tax liability for many of these asset classes.

For $35 million, you can use an advisor that charges a very very small advisory fee and use managed accounts held directly by DFA.

This portfolio should average at least 5% after tax over a long period of time. "Low risk"? That really depends on what you think is risky. This portfolio is more of a medium risk portfolio. Every 20 years or so this portfolio will have a loss of 10% or more.

[ QUOTE ]
Are prenuptial agreements enough to protect against divorce settlements?

[/ QUOTE ]
If you own $35 million in your own name, get married, and keep your assets separate throughout your marriage, then it should be considered a non-marital asset and your ex-spouse should not be entitled to any of it, even without a prenuptial agreement.

Now, every state is different, and you really should speak with a divorce attorney in your state.

In addition to the assets, you have to consider your income, and whether you are providing for your spouse and/or children. If you do, and later get divorced, you may be required to pay spousal and/or child support. That is separate from a spouse getting any of your separate assets.

Good luck,

-Tom