If you had 1 million dollars, how would you invest it?

[biophase]

I make ~ $1k per month doing software consulting on the side. I've been working on a SaaS idea for small/mid-size construction companies for a couple of years off and on. I built an MVP that a couple of companies are using internally right now. I'm going to buckle down on marketing/sales this year and see what happens...

I was just curious because you said you offered this to your friend and he declined. But if you are making $1k a month, his investment would have been tiny. What would you have asked for? It makes no sense for him to invest now.

There's nothing to invest in but a crap shoot at this point. You would have to offer him something like $20k for 50% which makes no sense to you or him.

It's better to wait until you actually have a business and it is making $50k or $100k a year. Then you go offer him $100k for 30%. He sees that he can get a 30% return and you actually get some money that means something.

 

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[biophase]

I don't understand why a lot of you guys would tie up all of your cash investing in real estate if your goal is to start a Fastlane business. And then you'd have a shitload of debt and tenants to worry about!

This is because of the way you asked the question. Everybody has different skills and in different stages of their lives so the answers are based upon them.

Most of the time when this question is asked, it is asked by someone who doesn't know how to invest, else they would not be asking the question.

So by default you are going to get the safer return investment answers. That's why you get answers like real estate, stocks, CD's, etc...

Nobody is going to say that they would trade options with it, as advice to you, because that takes a skill set. Nobody is going to recommend that you open up a restaurant chain, even if that's how they made their money.

For example, I didn't answer that I would invest it all into ecommerce even though that is what I do for a living because you probably don't have the same knowledge as me in this field. That would be a horrible recommendation to you or your friend.

 

[A_Random_Guy]

Are you going to learn the Asian languages first? That would seem like a threshold issue to know what you are doing. Since you read and write English, you might start with that.

Since I am from India, I know 4 Asian languages,Japanese and English. What I meant was learning to code in several languages from a private tutor who is broke is worth your time because your money means a lot to him and I find Asian coders easy to follow and understand when learning a programming language. The result: You know a lot of languages and now can build your own online company or go freelancing or even get into the BIG 4 to earn a lot more than your initial million dollars.

 

[Ing]

This is because of the way you asked the question. Everybody has different skills and in different stages of their lives so the answers are based upon them.

Most of the time when this question is asked, it is asked by someone who doesn't know how to invest, else they would not be asking the question.

So by default you are going to get the safer return investment answers. That's why you get answers like real estate, stocks, CD's, etc...

Nobody is going to say that they would trade options with it, as advice to you, because that takes a skill set. Nobody is going to recommend that you open up a restaurant chain, even if that's how they made their money.

For example, I didn't answer that I would invest it all into ecommerce even though that is what I do for a living because you probably don't have the same knowledge as me in this field. That would be a horrible recommendation to you or your friend.

You are right.
I propably would open an own engeneer bureau. Doing what I do for living 27 years now.
And I have 2 young men following!

 

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[Danny V.]

Back in to the business baby all day everyday. Keep growing.

 

[Kak]

Uh???? A bunch of you guys wouldn't have your million dollars for very long! Maybe that's why you don't have it in the first place...

Yep.

This is the phenomenon where people win the lottery and are broke in 5 years. These are people that could have spent 5 or 6 million dollars per year for the rest of their lives and still can't manage to keep it.

Keeping money is just as hard as making it. Everyone likes to think they wouldn't go broke if they won... But the stats don't lie. It is very rare for them to keep their money.

To the OP, you are creating a hypothetical lottery with way less money. Asking what you would invest in if you had a million dollars implies that the person answering doesn't have a million dollars. They are the worst people to ask. Why? Because they haven't tested their confidence yet. They have not proven that they wouldn't be a broke lottery winner. Their advice is worth what you paid for it.

Wealth is what you have in your possession. Tossing it back into the business mindlessly makes it not your's again. Business puts money into your net worth pile. While business can expand and contract, your net worth should only grow via adding to it and investments. I am NOT suggesting one shouldn't scale their businesses. On the contrary, I believe in scaling as large as possible, but putting money back in again and again just because is playing Russian roulette with your personal net worth and lifestyle.

To answer this question literally, I'm in the markets at 80/20 stocks and bonds. Moving to a more real estate heavy portfolio in the first of the year. At this stage in the market I plan to be very conservative and defensive in real estate, choosing deals with some sweat equity. Hope my literal answer to the question helps someone... But as @biophase said, literally answering the question is crap advice. The answer is almost always "it depends."

 

[allen0879]

Yep.

This is the phenomenon where people win the lottery and are broke in 5 years. These are people that could have spent 5 or 6 million dollars per year for the rest of their lives and still can't manage to keep it.

Keeping money is just as hard as making it. Everyone likes to think they wouldn't go broke if they won... But the stats don't lie. It is very rare for them to keep their money.

To the OP, you are creating a hypothetical lottery with way less money. Asking what you would invest in if you had a million dollars implies that the person answering doesn't have a million dollars. They are the worst people to ask. Why? Because they haven't tested their confidence yet. They have not proven that they wouldn't be a broke lottery winner. Their advice is worth what you paid for it.

Wealth is what you have in your possession. Tossing it back into the business mindlessly makes it not your's again. Business puts money into your net worth pile. While business can expand and contract, your net worth should only grow via adding to it and investments. I am NOT suggesting one shouldn't scale their businesses. On the contrary, I believe in scaling as large as possible, but putting money back in again and again just because is playing Russian roulette with your personal net worth and lifestyle.

To answer this question literally, I'm in the markets at 80/20 stocks and bonds. Moving to a more real estate heavy portfolio in the first of the year. At this stage in the market I plan to be very conservative and defensive in real estate choosing deals with some sweat equity. Hope my literal answer to the question helps someone... But as @biophase said, literally answering the question is crap advice. The answer is almost always "it depends."

I completely agree!

I regret the way I asked the original question. A lot of the answers remind me of my middle class grandparents talking about what they're going to do when they win the lottery "someday". I should have targeted people that HAVE at least 1 million dollars and how they invest it. And how they invest it definitely depends on their age, business goals, ambition, etc

The funny thing is that the people I've talked to that actually HAVE one million dollars in liquid assets seem a lot less enamored by the money. They are much more rational and less emotional. They value the money and are grateful for it, but realize it's not really that much. They are more concerned with investing the capital wisely to create more value.

The millionaires I personally know, all live far below their means, have little to no debt, and only increase their standard of living if their income/net worth increases. So, while they may splurge on a nice car or toys from time to time, it's something they can very comfortably pay for in cash. Most of them actually fly under the radar and like it that way e.g. they drive something like a Toyota Tacoma and don't want to flash their wealth. I think they just love playing the "game" of business, investing, and capitalism and value the freedom and options the money gives them.

 

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[Danny V.]

Yep.

This is the phenomenon where people win the lottery and are broke in 5 years. These are people that could have spent 5 or 6 million dollars per year for the rest of their lives and still can't manage to keep it.

Keeping money is just as hard as making it. Everyone likes to think they wouldn't go broke if they won... But the stats don't lie. It is very rare for them to keep their money.

To the OP, you are creating a hypothetical lottery with way less money. Asking what you would invest in if you had a million dollars implies that the person answering doesn't have a million dollars. They are the worst people to ask. Why? Because they haven't tested their confidence yet. They have not proven that they wouldn't be a broke lottery winner. Their advice is worth what you paid for it.

Wealth is what you have in your possession. Tossing it back into the business mindlessly makes it not your's again. Business puts money into your net worth pile. While business can expand and contract, your net worth should only grow via adding to it and investments. I am NOT suggesting one shouldn't scale their businesses. On the contrary, I believe in scaling as large as possible, but putting money back in again and again just because is playing Russian roulette with your personal net worth and lifestyle.

To answer this question literally, I'm in the markets at 80/20 stocks and bonds. Moving to a more real estate heavy portfolio in the first of the year. At this stage in the market I plan to be very conservative and defensive in real estate choosing deals with some sweat equity. Hope my literal answer to the question helps someone... But as @biophase said, literally answering the question is crap advice. The answer is almost always "it depends."

I do construction so having the additional capital would increase my bonding aggregate, estimating staff and management to expand. I already need this with more opportunities than I can handle at the moment. At the moment I have be conscientiously spending money on expanding based on the capital I do have. Thus, I would confidently put it back in the business.

 

[Kak]

I do construction so having the additional capital would increase my bonding aggregate, estimating staff and management to expand. I already need this with more opportunities than I can handle at the moment. At the moment I have be conscientiously spending money on expanding based on the capital I do have. Thus, I would confidently put it back in the business.

There is a difference everyone should note here. Your first claim to sock it all back in the business was completely conditional.

If the business needs some money to confidently grow... Do it, but know there are countless non personal ways to capitalize solid opportunities.

If I chucked my investable personal assets back into my businesses right now it would sit in a bank account or be blown on unproven directions for the speculation of growth.

 

[Danny V.]

There is a difference everyone should note here. Your first claim to sock it all back in the business was completely conditional.

If the business needs some money to confidently grow... Do it, but know there are countless non personal ways to capitalize solid opportunities.

Agreed.

Our office is in a business park comprised of warehouses, retail and offices. I could do a tour driving around pointing to all the failed businesses and waste money. I have seen guys buy an office, spend 200-300k remodeling only to outgrow it in a year or two then have it on the market for a year vacant trying to lease or sell it because it was way over improved or too specific.

 

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[biophase]

The funny thing is that the people I've talked to that actually HAVE one million dollars in liquid assets seem a lot less enamored by the money. They are much more rational and less emotional. They value the money and are grateful for it, but realize it's not really that much. They are more concerned with investing the capital wisely to create more value.

The millionaires I personally know, all live far below their means, have little to no debt, and only increase their standard of living if their income/net worth increases. So, while they may splurge on a nice car or toys from time to time, it's something they can very comfortably pay for in cash. Most of them actually fly under the radar and like it that way e.g. they drive something like a Toyota Tacoma and don't want to flash their wealth. I think they just love playing the "game" of business, investing, and capitalism and value the freedom and options the money gives them.

And this is why they are actual millionaires. They make informed and rational decisions. They don't just say, let's put everything into real estate! Or let's put it all back into the business! It all depends.

I've been buying real estate cash for the past 4 years now. Other people always ask me, why aren't you leveraging? Why pay $200k for a house, when you can get 5 houses with $40k down on each? Or why not put the $200k back into your business, that would return you much more than 6%.

To put it simply, if I had a plan to grow my business this year, and this plan needed $200k, I would definitely put that into my business. But what if my bank account had $1M? All I need is $200k, what do I do with the extra $800k? Obviously, putting it back into your business is not an option. That's why I buy real estate with it.

 

[WJK]

Yep.

This is the phenomenon where people win the lottery and are broke in 5 years. These are people that could have spent 5 or 6 million dollars per year for the rest of their lives and still can't manage to keep it.

Keeping money is just as hard as making it. Everyone likes to think they wouldn't go broke if they won... But the stats don't lie. It is very rare for them to keep their money.

To the OP, you are creating a hypothetical lottery with way less money. Asking what you would invest in if you had a million dollars implies that the person answering doesn't have a million dollars. They are the worst people to ask. Why? Because they haven't tested their confidence yet. They have not proven that they wouldn't be a broke lottery winner. Their advice is worth what you paid for it.

Wealth is what you have in your possession. Tossing it back into the business mindlessly makes it not your's again. Business puts money into your net worth pile. While business can expand and contract, your net worth should only grow via adding to it and investments. I am NOT suggesting one shouldn't scale their businesses. On the contrary, I believe in scaling as large as possible, but putting money back in again and again just because is playing Russian roulette with your personal net worth and lifestyle.

To answer this question literally, I'm in the markets at 80/20 stocks and bonds. Moving to a more real estate heavy portfolio in the first of the year. At this stage in the market I plan to be very conservative and defensive in real estate, choosing deals with some sweat equity. Hope my literal answer to the question helps someone... But as @biophase said, literally answering the question is crap advice. The answer is almost always "it depends."

I think it harder to keep the money you earn than to earn it in the first place. Most people have to make their fortunes at least two times and they hang on to the third. Then there's another challenge. That guy tends to sit on his small pile of cash and assets like a chicken sits on her fragile egg. Most don't grow it any further because of their great fear of loss that they learned the first two times. It's the classic Catch 22.

 

[Datingafter35]

I'm curious about how Fastlane entrepreneurs would invest one million dollars. Would you put it in stocks? Invest in real estate? Bootstrap a business from scratch? Buy an existing business?

Put in bonds. Wait until Jan 15. Then Throw money in indices. If not buy yen but gold is overbought. Euro and aussie are on a pullback. If Iran goes to war. Oil will rise. Cad will F*cking rocket. Commodity too will shoot up.

Australia having some shit now. Should be good to put on watch list.

 

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[Kevin88660]

Put in bonds. Wait until Jan 15. Then Throw money in indices. If not buy yen but gold is overbought. Euro and aussie are on a pullback. If Iran goes to war. Oil will rise. Cad will F*cking rocket. Commodity too will shoot up.

Australia having some shit now. Should be good to put on watch list.

Agree. i am longing junk bond now and using vix to hedge it. Wait for market corrects and then move into equity later.

 

[wildfox81]

1 million dollars is 7 crore Indian rupees. I would put it in the safest debt instrument like RBI (Reserve Bank of India) bonds that fetch 7.75% annually. And would be financially free.

The interest would be approx 4,50,000 rupees per month and even my lavish expenses would be 1,00,000 rupees per month.

 

[WJK]

i feel like I would invest part in precious metals and something that always has value. and another part I would spend on travel and stuff

Nothing you mentioned creates cash flow. It's a spending plan and a holding pattern. That first million should be the seed money to make more $ and create a sustainable life. Your plan is exactly how people lose their first million that they make... and then lose the second million after they lost the first... Are you aware that it takes around 3 million in net, working assets to comfortably retire? I respectfully suggest that you might rethink your plan for the long haul.

 

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[Ing]

I m not sure, what I would do with one million.
I think I m too afraid to loose it.
So I would put in in an ETF to not loose it to inflation and use it to have an insurance.
My calculation is, that an ETF million should bring on the long run about 8%, thats 80k. 20K tax, 25k inflation, so a rest of 35k to support my expenses or to raise the million.
Than I would reduce my everyday job and spend my time looking for a niche to help less privileged people. There are enough here around.
Or making more things making fun.
And I wouldn t do that because I want to monitize that, but because I could help those people.

I know, I m no good businessman.

 

[WJK]

I m not sure, what I would do with one million.
I think I m too afraid to loose it.
So I would put in in an ETF to not loose it to inflation and use it to have an insurance.
My calculation is, that an ETF million should bring on the long run about 8%, thats 80k. 20K tax, 25k inflation, so a rest of 35k to support my expenses or to raise the million.
Than I would reduce my everyday job and spend my time looking for a niche to help less privileged people. There are enough here around.
Or making more things making fun.
And I wouldn t do that because I want to monitize that, but because I could help those people.

I know, I m no good businessman.

So, become a good businessman! Its skills can be learned.

 

[Redwolf]

$500,000 in TSLA

I would just like to add that if you had done this on Dec 19, you would now have $982,323

 

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