Looking for advice for the "newly rich".

groupergenius

groupergenius

Active Member
Say you hit the lottery. Or a internet business, whatever and suddenly find yourself with millions of dollars. For the average person like myself, that kind of money at one time can be very troubling.
What to do? I'm not talking about dream spending, but what to do with the new wealth. I don't know that one could just deposit millions in ones normal bank account. Do you trust your bank?
By the same token, can you trust a financial advisor? Stocks are too flakey these days.
 
D

dragonzim

Active Member
I dont have a full answer for you but I know that banks will only insure up to $100,000 through the FDIC so there has to be some other type of institutionaccount to put the money in.
 
mgatdog

mgatdog

Member
First don't get into a hurry were to cash the check.Seek out a few financial advisers. My son said his company was paying out 4.25% on 250000 and it's insured. Just take your time don't jump at the 1st sure thing. just think 10 million would make you $ 425.000.00 before taxes a year you wouldn't have to touch the millions.I think that's a nice salary for just rolling out of bed.
 
J

jrthomas40

Guest
Originally Posted by DragonZim
http:///forum/post/2681487
I dont have a full answer for you but I know that banks will only insure up to $100,000 through the FDIC so there has to be some other type of institutionaccount to put the money in.
you can take out a special insurance that would cover your specific amount through FDIC...but i would probably spread it out to a few banks, live off the interest but be grounded instead of going crazy...the first couple of weeks might be some heavy spending but not buying $300,000 cars or big houses...would most travel and play golf at nice courses
 
aquaknight

aquaknight

Active Member
2 finincial advisors, to watch each other with my money. As to what I'd do, commit a career to racing. Somewhere in the SCCA's at first, working up with the ultimate goals to reach the Speed World Challenge Series, and maybe one day tackle Le Mans.
 
rylan1

rylan1

Active Member
I've talked about this... it might be pretty overwhelming for most people. The intial shock or joy would be the your first feelings...and everything you could do with that $... but when you think about the managerial aspects... that would be a full time job for a probably a couple months.
I would seek advise first... if I could get in touch w/ a very wealthy person that would probably help... but I wouldn't put everything in one basket.... I'd probably would do a variety of different things such as trusts, maybe $ in 3 banks, investments/bonds..etc We have the mega millions here and lotto is up t0 $75million w/ like a $45 million payout... For some people it would be better to do intallments to get a grip on how to manage
 
rylan1

rylan1

Active Member
1st thing I would do is take a vacation (go into hiding
) Can you imagine everyone that would be trying to track you down... Financial people,family, friends, people who knew you 10 years ago, con artists, etc...
 
rylan1

rylan1

Active Member
Originally Posted by jrthomas40
http:///forum/post/2681510
you can take out a special insurance that would cover your specific amount through FDIC...but i would probably spread it out to a few banks, live off the interest but be grounded instead of going crazy...the first couple of weeks might be some heavy spending but not buying $300,000 cars or big houses...would most travel and play golf at nice courses
I'd get at least one stupid expensive car...$110K-$250K... that is if I hit that $75 million
 
spanko

spanko

Active Member
Originally Posted by Rylan1
http:///forum/post/2681519
1st thing I would do is take a vacation (go into hiding
) Can you imagine everyone that would be trying to track you down... Financial people,family, friends, people who knew you 10 years ago, con artists, etc...
Yeah I think this would be a must. Ensure some privacy and allow you to talk to a few advisor's via phone or emails. Do some up front investigation while sipping drinks with umbrellas in them and snorkeling some reefs.
 
m0nk

m0nk

Active Member
Personally, I'd stash some money, some valuable goods (ones that will hold value), etc at various locations around the world, build a "bunker" in Colorado somewhere, then buy a boat and sail.... and sail.... and sail....
and when I'm done sailing, if the world is falling apart, I got something to help me stay somewhat comfortable and a place to hide out if needed.
 
rockman

rockman

Member
TELL NO ONE
A friend of mine came into considerable money some years back
I watched people swarm on him like killer bees looking for a handout or needing desperate help.. even people he thought were his Friends!
I never ask him for anything and we're still best friends

I would still help people out!
but it would be unexpected and on my terms.
 
reefraff

reefraff

Active Member
Pay off all your debts and perhaps those of immediate family members within reason. Never know when you might need to make a withdraw from the favor bank

If you aren't interested in starting a buisiness put the money to work. I'd put half in the stock market and spred the other hald around different banks in Money Market accounts and various term CD's. I wouldn't put over 300 grand in any one bank. The feds will cover up to 100 grand so even if one went belly up it isn't the end of the world.
Stock are still the best return over the long haul so you gotta be in, just can't be stupid about it. Throw a third of the stock money into mutual funds with good divident payments, let a financial guy activeley work another thrird and invest the last third in will thought out stock plays but make sure you are in complete control of all of the stocks stuff except for the third you have the financial guy playing lest your dough ends up in his brother in law's guppy farm. Lots of zeros can make good people do bad things,
 
stdreb27

stdreb27

Active Member

Originally Posted by Rockman
http:///forum/post/2681637
TELL NO ONE
A friend of mine came into considerable money some years back
I watched people swarm on him like killer bees looking for a handout or needing desperate help.. even people he thought were his Friends!
I never ask him for anything and we're still best friends

I would still help people out!
but it would be unexpected and on my terms.
I'd tell them I had some investements pay off unexpectedly. I know, my uncle is a selfmade millionare and very generous, but if he isn't careful he'd have a line of people to see him begging for money. Usually what ends up happening is that he offers them a job then works them 20 hours a day. Then they end up leaving. (don't worry he works right next to them too)
 
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