Ask HN: Large inheritance windfall. What next?
4 comments
Are they still generating $70k/yr? How many properties are we talking?
I personally prefer investing in the stock market vs. property, because 1) property taxes, 2) tenants, 3) things break, etc etc. But others won't share that opinion. If you like property, you can also invest through REITs, which are publicly traded real estate funds that pay dividends.
One reason why I would not sell these houses is potentially taxes. Are you liable to pay capital gains tax on these? Or was the counter on those gains wiped when you inherited them? With interest rates being low, asset prices tend to increase fast(er). So if possible I might consider selling them. Depends on the property, city, location, etc.
$1.5m is still low enough that you can achieve above average returns by investing well in smaller deals and/or individual stocks, i.e. 10-30% a year. If I were you, I'd throw in the towel at your job and start learning how to invest your capital properly. And once your money is working for you, you can explore other entrepreneurial projects.
Invest in what you know, i.e. public technology companies, or buy a small tech company with some equity down + an SBA loan, etc etc. Put some of it in an S&P fund after a market decline. But take your time, don't rush it. A little capital can go a long way.
You're free, congratulations. Most people don't ever get there. Just keep reinvesting your profits, it snowballs faster than you realise if you don't blow it all on useless stuff.
I personally prefer investing in the stock market vs. property, because 1) property taxes, 2) tenants, 3) things break, etc etc. But others won't share that opinion. If you like property, you can also invest through REITs, which are publicly traded real estate funds that pay dividends.
One reason why I would not sell these houses is potentially taxes. Are you liable to pay capital gains tax on these? Or was the counter on those gains wiped when you inherited them? With interest rates being low, asset prices tend to increase fast(er). So if possible I might consider selling them. Depends on the property, city, location, etc.
$1.5m is still low enough that you can achieve above average returns by investing well in smaller deals and/or individual stocks, i.e. 10-30% a year. If I were you, I'd throw in the towel at your job and start learning how to invest your capital properly. And once your money is working for you, you can explore other entrepreneurial projects.
Invest in what you know, i.e. public technology companies, or buy a small tech company with some equity down + an SBA loan, etc etc. Put some of it in an S&P fund after a market decline. But take your time, don't rush it. A little capital can go a long way.
You're free, congratulations. Most people don't ever get there. Just keep reinvesting your profits, it snowballs faster than you realise if you don't blow it all on useless stuff.
There are 3 properties, 4 with the addition of my parents' home (which I believe I could probably rent for more than the others, to generate at least around $100k total). They three are all rented out for (at a minimum) the rest of 2017.
I believe the tax basis on the homes has been reset with their passing, so capital gains would be set to $0 if I were to sell immediately (but as we have renters, I don't foresee that happening). These houses are also in a state that doesn't have state income tax, for what it's worth. Sales tax is relatively high though.
I'll definitely be reading more books to get a better grasp on the situation, too - thanks.
I believe the tax basis on the homes has been reset with their passing, so capital gains would be set to $0 if I were to sell immediately (but as we have renters, I don't foresee that happening). These houses are also in a state that doesn't have state income tax, for what it's worth. Sales tax is relatively high though.
I'll definitely be reading more books to get a better grasp on the situation, too - thanks.
My parents left me a bit more than expected in their will. We've discussed the matters before, but now that it's in effect, so to speak, I'm unable to ask them for their advice any longer. Thanks to my tech salary I've already paid off my student loans, and have no outstanding debt. My question lies not in what to do with the liquid assets my parents left me (we've talked about it), but with their surprise parting gift: about $1.5 million in ownership of multiple home properties.
My parents rented these houses out for a total of around $70k/yr (before taxes) as passive income in their retirement (though my father did manage the properties himself). They also left me the house they raised me in. The value for these houses has always been fairly stable, though recently they have been increasing in value at about 7-10% year.
I'm currently unmarried (my parents were old for my age), but I'm hoping to marry soon and eventually raise a child. What's the best course of action to ensure not only a comfortable future for me, but also to ensure the best possible future for my familY? I've always wanted to potentially take a break from my tech job to pursue a startup, and now I feel like I may have the means to do so without jeopardizing my family's future. Is temporarily living on the income from rent advisable to do this, or should I just sit on the houses until they accumulate some optimal value to liquidate and invest at, or should I keep my job and put the passive income from the rent into buying another property and snowballing from there (though real estate really isn't my favorite thing in the world... I'm sure I could pay someone a cut to manage the properties, though)?
Lawyers and accountants are helpful in making any of these options happen, but to do so requires I actually know what I want them to do. This is a very generous gift on my parents' part, but I'm a little overwhelmed.