White people problem: Too much money and what to do with it all?

OU Ariakas · Aug 1, 2022

My wife and I are most likely going to have a lump sum of very low 7 figures to our names by the end of the year. I know it is going to be life changing but it is not enough to just retire on immediately. I know that if we want to keep working for the next 25 years then the best thing to do would be to index fund it but I cannot get away from the nagging feeling that having that much liquid cash means that I could do something that could snowball to early retirement because of the absolute amount. Does anyone have experience in being a passive investor in things like apartment complexes or commercial real estate for national brands? Hell, it would even be enough to qualify for a McDonalds franchise but the wife already shot that one down.

Sanrith Descartes · Aug 1, 2022

OU Ariakas said:
My wife and I are most likely going to have a lump sum of very low 7 figures to our names by the end of the year. I know it is going to be life changing but it is not enough to just retire on immediately. I know that if we want to keep working for the next 25 years then the best thing to do would be to index fund it but I cannot get away from the nagging feeling that having that much liquid cash means that I could do something that could snowball to early retirement because of the absolute amount. Does anyone have experience in being a passive investor in things like apartment complexes or commercial real estate for national brands? Hell, it would even be enough to qualify for a McDonalds franchise but the wife already shot that one down.

Risk vs Reward.
The advantage of Indexing it is the historical S&P return is just under 10% a year. When you begin to look at 7 figures, that means a historical return of six figures. Its the power of large numbers. Using a hypothetical low 7 figure number of $2.5m, that means on average a hypothetical historical return of $250,000. This then gets amplified by the sorcery that is compounded interest. Here is the 10-year view if you keep working, live your life as it is and don't touch it.

I am not saying real estate or a Mickey D's franchise can't make you more money. But this is about as low-risk, hands off as it gets (short of buying US Treasuries at a much lower return). having 7 figures as the initial investment is the magic key that open the doors to early retirement.

OU Ariakas · Aug 1, 2022

Sanrith Descartes said:
Risk vs Reward.
The advantage of Indexing it is the historical S&P return is just under 10% a year. When you begin to look at 7 figures, that means a historical return of six figures. Its the power of large numbers. Using a hypothetical low 7 figure number of $2.5m, that means on average a hypothetical historical return of $250,000. This then gets amplified by the sorcery that is compounded interest. Here is the 10-year view if you keep working, live your life as it is and don't touch it.

View attachment 425586

I am not saying real estate or a Mickey D's franchise can't make you more money. But this is about as low-risk, hands off as it gets (short of buying US Treasuries at a much lower return). having 7 figures as the initial investment is the magic key that open the doors to early retirement.

Fucking hell, I guess I just needed to see the compounding interest in that table to make it clear. Thanks bro.

Edit: that also isn't taking into account the dividend reinvestment happening along the way. I find it is good for a few extra percentage points a year in the return.

Sanrith Descartes · Aug 1, 2022

OU Ariakas said:
Fucking hell, I guess I just needed to see the compounding interest in that table to make it clear. Thanks bro.

Edit: that also isn't taking into account the dividend reinvestment happening along the way. I find it is good for a few extra percentage points a year in the return.

It does count dividend reinvestment. S&P with dividend reinvestment is just around 9.75%.

edit: if you are comfortable with excel just make cell A1 year 1, cell B1 the principal amount (whatever you are expecting to invest) and cell C1 the formula =b1*0.0907
Then drag down A1 to autopopulate the years, in B2 type the formula =B1+C1 and then drag down C1 to continue the interest formula. Voila.

I checked the latest info and S&P is down to around 9.07%

pysek · Aug 1, 2022

AladainAF said:
Legit: How? My posting history already fucks me on that. And while I'd love to be a force for good (how we define good, not the social justice bullshit ways) I wouldn't have any fucking idea how to get started at that other than maybe start local?

This may sound dumb but I have had an idea that I'm not quite sure how to implement but I'm reasonably sure would work: crowdfunded lobbying.

The biggest way we as citizens get fucked is the legislative process and the lobbyists therein. I promise you no politician has any idea what's in any bill they vote on. The language is written by corporate lawyers and pushed by lobbyists. The other way they fuck us is that is an expensive game to get into. Even good state lobbyists make an easy six figures, and they should; they make people very rich.

But what if there was a website where you could donate money, and help create legislation at the state level that you and everyone on the site would help a lobbyist push through a legislature? I promise you we'll get nowhere in Congress; it has to burn, but states have way more rights and powers than they exercise and lobbyists are rank whores. They'll work for the money.

And that's why it'll work. Zog zealots are true believers, egotists work only for themselves, and everyone else is blackmailed into submission so it's really hard to make political headway. But get a team of lobbyists backed by phone calls and emails from in-district voters who act in a bloc...well, you've the makings of a Whitebread Revival and I think that's something to consider.

Kithani · Aug 1, 2022

pysek said:
This may sound dumb but I have had an idea that I'm not quite sure how to implement but I'm reasonably sure would work: crowdfunded lobbying.

The biggest way we as citizens get fucked is the legislative process and the lobbyists therein. I promise you no politician has any idea what's in any bill they vote on. The language is written by corporate lawyers and pushed by lobbyists. The other way they fuck us is that is an expensive game to get into. Even good state lobbyists make an easy six figures, and they should; they make people very rich.

But what if there was a website where you could donate money, and help create legislation at the state level that you and everyone on the site would help a lobbyist push through a legislature? I promise you we'll get nowhere in Congress; it has to burn, but states have way more rights and powers than they exercise and lobbyists are rank whores. They'll work for the money.

And that's why it'll work. Zog zealots are true believers, egotists work only for themselves, and everyone else is blackmailed into submission so it's really hard to make political headway. But get a team of lobbyists backed by phone calls and emails from in-district voters who act in a bloc...well, you've the makings of a Whitebread Revival and I think that's something to consider.

Honestly your local state government is owned by construction, healthcare, telecoms +/- whatever big industry is in your region. You still wouldn’t have a chance.

pysek · Aug 1, 2022

Your point is well-taken, which is why you need a local lobbyist. They know who the players are, and in many cases, where they're weak. They have had lunch and drinks with many of the lobbyists for the opposition and they know them as people. All these are competitive advantages.

But the biggest piece is the crowdfunding. A LOT of people donating a LITTLE money and each feeling invested is how it gets done. No large entity or foundation or grant-giving outfit should be able to donate enough money to sway it. It has to be people-owned and -operated and I promise, it could have a much bigger impact than you think.

Tmac · Aug 2, 2022

Kithani said:
Honestly your local state government is owned by construction, healthcare, telecoms +/- whatever big industry is in your region. You still wouldn’t have a chance.

LOL wut? How do you think organizations lobby? They hire fucking lobbying firms.

If you crowdsourced lobbying you'd have one main person and then hire a couple of lobbying firms for $100k - $200k a year. Then just repor to your supporters. This is how ALL NPO"s that lobby work.

pysek · Aug 2, 2022

Tmac said:
LOL wut? How do you think organizations lobby? They hire fucking lobbying firms.

If you crowdsourced lobbying you'd have one main person and then hire a couple of lobbying firms for $100k - $200k a year. Then just repor to your supporters. This is how ALL NPO"s that lobby work.

While the legislation the lobbyists push is written by attorneys, it is authorized by a vote of the people who fund the campaign, so there's no room for special interest to wiggle in, provided you have open financials and a decent governing board.

The panic would be almost worth the price of admission alone.

Haus · Aug 28, 2022

So,... in line with the topic of the thread...

I'm looking to purchase some land out from Dallas to build a "rest of our lives" home for Mrs. Haus and I. I realize the optimal time to drop money on this land will probably be once the apparently impending retail real estate bubble bursts. Question is how long people think that will be and what a good vehicle for storing capital until then will be that should at minimum beat inflation?

Furry · Aug 28, 2022

Haus said:
So,... in line with the topic of the thread...

I'm looking to purchase some land out from Dallas to build a "rest of our lives" home for Mrs. Haus and I. I realize the optimal time to drop money on this land will probably be once the apparently impending retail real estate bubble bursts. Question is how long people think that will be and what a good vehicle for storing capital until then will be that should at minimum beat inflation?

Pick a smaller town to look near. I can think of absolutely nothing of value about Dallas, and one of the good things about texas is that it's overall moderate level of development on the entire east side means you can poke a finger just about anywhere away from the cities and have a great grocery store, awesome BBQ and other such restaurants, and probably even other stuff you'd be surprised to find.

Just look at nearest city's courthouse to give it the courthouse test. Every town in texas has the courthouse square, read the reviews of what people think about the businesses around it and you'll get an idea if the town is good or not. Don't be scared if they look a little wonky. That's a Texas thing. Here I picked a random ass town: Cameron Texas. Restaurants around it had good reviews. Looks old and wonky, but most of these places do, it gets to be charming when you're used to it. Looks like you're 50 miles out from austin on an east approach (best way to approach the city), so if you wanted to have a fancy day, you could. And I'd rather visit Austin than Dallas 10 times over. Places with multiple acres for sale for mid-low 100ks. Temple is also nearby, which is a nice little town.

Stay away from Dallas.

Burns · Aug 29, 2022

Haus said:
So,... in line with the topic of the thread...

I'm looking to purchase some land out from Dallas to build a "rest of our lives" home for Mrs. Haus and I. I realize the optimal time to drop money on this land will probably be once the apparently impending retail real estate bubble bursts. Question is how long people think that will be and what a good vehicle for storing capital until then will be that should at minimum beat inflation?

Sounds like you are asking for a safe short term investment that has slightly better returns than inflation but still allows you to stay liquid.

I don't think that exists in current conditions.

As for when a bubble will burst, only Jim Cramer knows that. If you read forever bears like Zero Hedge, the bubble is about to burst burst, in the next couple weeks...for the last 10 years.

Burns · Aug 29, 2022

Furry said:
Pick a smaller town to look near. I can think of absolutely nothing of value about Dallas, and one of the good things about texas is that it's overall moderate level of development on the entire east side means you can poke a finger just about anywhere away from the cities and have a great grocery store, awesome BBQ and other such restaurants, and probably even other stuff you'd be surprised to find.

Just look at nearest city's courthouse to give it the courthouse test. Every town in texas has the courthouse square, read the reviews of what people think about the businesses around it and you'll get an idea if the town is good or not. Don't be scared if they look a little wonky. That's a Texas thing. Here I picked a random ass town: Cameron Texas. Restaurants around it had good reviews. Looks old and wonky, but most of these places do, it gets to be charming when you're used to it. Looks like you're 50 miles out from austin on an east approach (best way to approach the city), so if you wanted to have a fancy day, you could. And I'd rather visit Austin than Dallas 10 times over. Places with multiple acres for sale for mid-low 100ks. Temple is also nearby, which is a nice little town.

Stay away from Dallas.

View attachment 430349

The most important question you have to ask yourself, when buying a home in Texas is: "How far is it to the closest HEB grocery store?" If you find an HEB, the chances are that the area is of high quality.

Sanrith Descartes · Aug 29, 2022

Burns said:
As for when a bubble will burst, only Jim Cramer knows that and it will burst 20 minutes after Jimmy tells you there is no bubble and to buy, buy, buy.

ftfy

Sanrith Descartes · Aug 29, 2022

Burns said:
The most important question you have to ask yourself, when buying a home in Texas is: "How far is it to the closest HEB grocery store?" If you find an HEB, the chances are that the area is of high quality.

I stopped a Buc-ees somewhere between Austin and Dallas last week and I was like... wtf is this? The number of Tesla superchargers was only exceeded by the number of gas pumps. Damn that place was ginormous. Fucking packed too.

Furry · Aug 29, 2022

Sanrith Descartes said:
I stopped a Buc-ees somewhere between Austin and Dallas last week and I was like... wtf is this? The number of Tesla superchargers was only exceeded by the number of gas pumps. Damn that place was ginormous. Fucking packed too.

That was in Temple, the city I mentioned a couple posts above. Have they finished the construction on the highway there yet. That's been going on at least 15 years.

And HEB is great, but I wouldn't limit myself to where they are. They aren't quite established in the woodlands and north/northeast of texas, and plenty of places that are great there. Krogers are just fine too, and even the rural walmarts are usually good if theres no other good options. They are often so incredibly busy that everything is super fresh. All of the busiest walmarts in texas are in the middle of nowhere.

Sanrith Descartes · Aug 29, 2022

Furry said:
Have they finished the construction on the highway there yet. That's been going on at least 15 years.

No Way Do Not Want GIF by Schitt's Creek

Burns · Aug 29, 2022

Furry said:
And HEB is great, but I wouldn't limit myself to where they are. They aren't quite established in the woodlands and north/northeast of texas, and plenty of places that are great there. Krogers are just fine too, and even the rural walmarts are usually good if theres no other good options. They are often so incredibly busy that everything is super fresh. All of the busiest walmarts in texas are in the middle of nowhere.

Don't know why anyone would chose to live east of Dallas and north of Conroe, unless work or family takes you there. If you want to build a retirement home in flat green woodlands, you might as well move to Arkansas to take advantage of the lower property taxes.

Texas hill country is at least unique for this area of the country/climate and HEB is more prevalent in those areas!

HEB is slowly spreading out, but yea, major metros are a different ballgame. The "nice" parts of Houston are mostly covered now days, including two stores in The Woodlands (the way the Woodlands is planed out makes for limited business expansion opportunities), but the whole DFW metroplex only has half a dozen, if you count Central Market.

Furry · Aug 29, 2022

Burns said:
Don't know why anyone would chose to live east of Dallas and north of Conroe, unless work or family takes you there. If you want to build a retirement home in flat green woodlands, you might as well move to Arkansas to take advantage of the lower property taxes.

As long as you are more than 90 mins drive from Dallas you can probably find a nice place. If you pick any place with some acreage in Texas you’re not doing it right if you don’t set up a farm, ecolab or some other scheme to duck taxes. I wouldn’t exclude areas outside of it, though I also won’t deny the benefits of living in the triangle.

And Central market is a thing of its own. Very upscale grocery store which is hard to directly compare to HEB.

Burns · Aug 29, 2022

Furry said:
As long as you are more than 90 mins drive from Dallas you can probably find a nice place. If you pick any place with some acreage in Texas you’re not doing it right if you don’t set up a farm, ecolab or some other scheme to duck taxes. I wouldn’t exclude areas outside of it, though I also won’t deny the benefits of living in the triangle.

And Central market is a thing of its own. Very upscale grocery store which is hard to directly compare to HEB.

HEB owns Central Market, so it technically counts as HEB!

White people problem: Too much money and what to do with it all?

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