Questions for the financial gurus

Arkitech

Diamond Member
Apr 13, 2000
8,356
4
76
So let's say you came into a million bucks over the course of a few months, where would you keep the money? Local bank, offshore accounts, CD accounts, etc...? I notice in most local banks that they only insure you up to 100k, so if that's the case where do you place your funds if you want them protected?

Also I've heard that for people with a certain amount of money that you have to constantly move it around to prevent the goverment from taxing you to death. Is this true? Can you be taxed on income more than once?

 

JS80

Lifer
Oct 24, 2005
26,271
7
81
I live in CA so i would park it in T-bills until i can find a suitable investment.
 

DaveSimmons

Elite Member
Aug 12, 2001
40,730
670
126
No you only have to pay taxes on income once (but to federal and state govenrments). For most family inheritances you don't even pay the once.

If you had that much money you'd want to put most of it into long term investments, such as stock index mutual funds. Major brokerages such as Schwab do carry a brokerage-specific insurance (similar to FDIC) for at least a million, I forget the exact cap.

Once you invest the money, you do pay taxes on some kinds of growth in value such as interest earned in a savings account. But the original money doesn't get taxed again, just the "new" money.
 

JLGatsby

Banned
Sep 6, 2005
4,525
0
0
Invest in low risk rental property. Small apartment building and use no leverage in a low risk market, this nearly eliminates risk. It's guaranteed income for life that will keep up with inflation.
 

FelixDeCat

Lifer
Aug 4, 2000
30,793
2,620
126
500K in EGLE @ 12.00% yield

250K cash / money market

250K Mid cap growth ETF

Taxes are a fact of life. Pay a tax advisor with your income. Moving accounts sounds fishy. Your not Proctor and Gamble and not even they could get away with it.

Enjoy.
 

DaveSimmons

Elite Member
Aug 12, 2001
40,730
670
126
Originally posted by: SoulAssassin
two chicks at the same time

/disappointed at the 3 people who responded before me
I did only say to put most of the money into investments ;)
 

JS80

Lifer
Oct 24, 2005
26,271
7
81
Originally posted by: FelixDeKat
500K in EGLE @ 12.00% yield

250K cash / money market

250K Mid cap growth ETF

Taxes are a fact of life. Pay a tax advisor with your income. Moving accounts sounds fishy. Your not Proctor and Gamble and not even they could get away with it.

Enjoy.

50% of the money in a small unknown shipping company that pays a high dividend yield is a bit too much exposure don't you think?
 

PhoenixOrion

Diamond Member
May 4, 2004
4,312
0
0
money-losing investments that I always wanted to do:

1. owning my own winery, vineyard
2. raising horses
3. operate charter boats
 

LegendKiller

Lifer
Mar 5, 2001
18,256
68
86
50% in diversified foreign investments

25% in domestic value funds

25% in alternative investments (hedge funds and/or private equity)
 

JLGatsby

Banned
Sep 6, 2005
4,525
0
0
Originally posted by: LegendKiller
25% in alternative investments (hedge funds and/or private equity)

Most hedge funds require a minimum of tens of millions.

And the government requires you to be a "accredited investor" in order to invest in hedge funds, which I believe is defined as either having a $250,000/year income or a net worth of at least $5 million.

You can thank your "mother knows best" government regulators for that.
 

tweakmm

Lifer
May 28, 2001
18,436
4
0
Speculate on the FOREX market with 10%
Put 40% in some sort of palladium investment
50% in a high yield money market account

If I saw the right business opportunity I wouldn't hesitate to throw some cash down if it had potential and I knew the field.
 

LegendKiller

Lifer
Mar 5, 2001
18,256
68
86
Originally posted by: JLGatsby
Originally posted by: LegendKiller
25% in alternative investments (hedge funds and/or private equity)

Most hedge funds require a minimum of tens of millions.

And the government requires you to be a "accredited investor" in order to invest in hedge funds, which I believe is defined as either having a $250,000/year income or a net worth of at least $5 million.

You can thank your "mother knows best" government regulators for that.

You can find lower ended hedge funds or even private equity that'll let you in for lower amounts.

Also, he said what I would do with a million, I would have no problem getting in.

 

JLGatsby

Banned
Sep 6, 2005
4,525
0
0
Originally posted by: LegendKiller
You can find lower ended hedge funds or even private equity that'll let you in for lower amounts.

Also, he said what I would do with a million, I would have no problem getting in.

Reread my post buddy. The government WILL NOT allow you unless you are an "accredited investor." (per their definition)

"Mother knows best" politicians have made it ILLEGAL for the average person to invest in hedge funds. From what I remember, the government requires that you have a $250,000/year income or a net worth of at least $5 million.
 

JS80

Lifer
Oct 24, 2005
26,271
7
81
Originally posted by: JLGatsby
Originally posted by: LegendKiller
You can find lower ended hedge funds or even private equity that'll let you in for lower amounts.

Also, he said what I would do with a million, I would have no problem getting in.

Reread my post buddy. The government WILL NOT allow you unless you are an "accredited investor." (per their definition)

"Mother knows best" politicians have made it ILLEGAL for the average person to invest in hedge funds. From what I remember, the government requires that you have a $250,000/year income or a net worth of at least $5 million.

When did they start regulating the hedge fund industry? I used to work for a hedge fund that accepted $250k clients (back in 2004).
 

Ameesh

Lifer
Apr 3, 2001
23,686
1
0
i personally would buy real estate but if not that then i'd invest in a business in china or dubai
 

EKKC

Diamond Member
May 31, 2005
5,895
0
0
Originally posted by: her209
I'd buy 10 shares of BRK.A

PRETTY SAD! 10 shares!
and you wont get that many more shares with BRK.B either, like 300 maybe?
 

JS80

Lifer
Oct 24, 2005
26,271
7
81
Originally posted by: JLGatsby
Originally posted by: JS80
When did they start regulating the hedge fund industry? I used to work for a hedge fund that accepted $250k clients (back in 2004).

They've always done it. Yeah they might only be investing only $250k, but those people are qualified per the government definition of "accredited investor."

Here is a link. http://en.wikipedia.org/wiki/Hedge_fund#U.S._regulation

good to know!
 

LegendKiller

Lifer
Mar 5, 2001
18,256
68
86
Originally posted by: JLGatsby
Originally posted by: LegendKiller
You can find lower ended hedge funds or even private equity that'll let you in for lower amounts.

Also, he said what I would do with a million, I would have no problem getting in.

Reread my post buddy. The government WILL NOT allow you unless you are an "accredited investor." (per their definition)

"Mother knows best" politicians have made it ILLEGAL for the average person to invest in hedge funds. From what I remember, the government requires that you have a $250,000/year income or a net worth of at least $5 million.

Re-read my post buddy. I said *WHAT I WOULD DO WITH A MILLION DOLLARS*. Did I say "If I could invest in hedge funds, I would". No. Perhaps you should try Dick and Jane books, they do wonders for reading comprehension and logical thinking.

http://www.investopedia.com/terms/a/accreditedinvestor.asp

Considering you'd already have a million in assets if you had a million.

not to mention you can always invest in "funds of funds" which circumvent the SEC regulation. Or you can invest in offshore. Where there is a will, there is a way.
 

uberman

Golden Member
Sep 15, 2006
1,942
1
81
You did not specify so I assume I get this money wherever. I'd keep it outside of the US. Why would I want to pay taxes on it?

BTW, One million dollars isn't very much nowadays. It would be a very small house in the San Francisco Bay Area. Probably 1,000 sq. feet.