If you were to invest 1 million?

2014-01-11 | WesternCulture

[WesternCulture]

I am unfortunate to have lost a very dear relative of mine.

Because of this sad occurrence, I have inherited some money.

I will not use them up at bars down in Berlin, Copenhagen and Rome Et cetera, even if this seems like something natural to do.

We all like money, don't we, but honour and family ties matter more than quick thrills.

Instead, I would like to invest in healthy companies.

If you happen to possess some knowledge of American business life that might be of use, pray inform me (- of course, the stock has got to be on the public market).

[max americana]

“I will not use them up at bars down in Berlin, Copenhagen and Rome Et cetera, even if this seems like something natural to do. “

I would. Your friend would have wanted you to enjoy your life. Then again, it’s now your money and invest in companies which have time and time again made money for (me) in the long run: McDonald’s, Samsung and 7-11 are examples..

[Crusher138]

I would invest it in my own company.

I have come to trust few with my money.

[Cloverfarm]

I’m sorry to hear you lost someone dear to you.

I would not make any big decisions, if possible, until after working through grief.

If I, personally, had a million dollars, I would buy farmland and cattle, or real estate, because those are familiar to my family and me.

[BreezyDog]

TVIX (VelocityShares Daily 2x VIX Short Term ETN)It’s at it’s lows. Risky but very easily could grow your money 10 fold quickly when TSHTF economically. Now is the time to invest in it.

[Flick Lives]

I will not use them up at bars down in Berlin, Copenhagen and Rome Et cetera...

There are worse investments.   ;-)

[PieterCasparzen]

Under US law and regulations, you would be termed an "accredited investor".

This means that you are not limited to publicly-held securities. No one cares if the market price of the stocks you own goes down. No one.

The only way to really be sure you'll not lose money is to trade on inside information, which is illegal. Wall Street and the SEC love to prosecute the occasional hapless inside trader that is not one of their buddies.

If you are an "accredited investor" (check into the US laws and regs that will actually apply to you because you are also a foreign investor, but $1 million is a cutoff point - search the web (SEC site, etc.) for info on this), you have a much wider array of potential investments available to you other than the "little people's casino" of publicly-held stocks.

In the private equity world, typically investments are made inside a limited partnership, and can often have great flexibility in what they invest in.

In fact, non-accredited investors (most of the public) are not legally allowed to invest in most private offering situations. This is how Initial Public Offerings, like facebook, twitter, etc., can see the early private investors earning fantastic returns when, around the time of the IPO, they sell the shares they bought while the company was privately held and just starting up.

There's nothing stopping you from setting up legal/tax entities (i.e., corporations, partnerships, etc.) in the US, buying real estate, businesses, etc., as long as, of course, all applicable laws and regulations are followed (and compliance is not that difficult or expensive with competent lawyer). Corporations, of course, generate taxable shareholder income whenever capital is returned to the investor, usually from share sales or dividends. Of course, the gains from share sales can effectively defer taxable gains for many years. For partnerships, on the other hand, income generally flows through to the partners as it is realized. Of course, partnerships can own shares in corporations. Generally speaking, Delaware law is the most consistent and therefore desireable, so legal entities are quite often formed in that state.

Certainly the US (along with the other "five eyes" nations, UK, Canada, Australia, New Zealand) has the benefit of a legal system that provides the best assurance of being able to get judicial satisfaction (thus retaining ownership of your legitimate assets) in courts of law. Of course, one can form entities in the "offshore" nations, but IMHO there's a lot more risk there, especially in terms of appearing to be money laundering. IMHO, much better to stay within the US, the Commonwealth, and the more attractive European countries (probably in that order).

Of course taxwise, business can be conducted anywhere from 100% straight up legitimate, to being a little aggressive towards being "tax-efficient", all the way to being way too "aggressive" in using strategies to lower tax, i.e., stretching the rules to their limits, which, of course, has a high risk of causing fines and penalties. IMHO, best to be 100% legit in terms of tax, and focus on quality investments with real, solid earnings.

IMHO, carefully cultivated personal relationships are even more important when placing investments in a foreign country as they are in domestic investing. In private investing, much of the constraints on information are removed, thus the investor can be far more certain of future profits.

[CalTexan]

With a .076 growth rate in your country, you better invest in babies...

With a .072 in the USA, we should too.

[ConstantSkeptic]

The most reliable way to invest is to diversify with low expense ratio index funds. John Bogle, the founder of The Vanguard Group, pioneered this concept after doing research into the returns from low expense index funds vs. managed mutual funds. A diversified portfolio of index funds provided better returns over time.

Check out Bogleheads - http://www.bogleheads.org/. They are a very knowledgeable group of investors who follow John Bogle’s advice. There is an excellent wiki at the site along with a forum populated with very bright investors. The fellow investors on the forum are very quick to help anyone posting questions.

[Zman]

Whatever portion you may decide to invest in stocks (and I would diversify across a number of asset classes) do not commit more than 5% to any one security and choose those that have consistently paid increasing dividends and paid down debts. Also use trailing stop losses (I use 25%) to limit the loss of capital in a down market. Safety is the watchword, in my view.

[Cementjungle]

I agree with everything Innovative said in post 24 above.

You can get a nice 5% or so return in a nicely conservative portfolio. I too take the tortoise approach rather than the hare... slow and easy, looking for a nice solid long-term gain.

There are plenty of good companies out there that will pay around 5% in dividends, and there are some great mutual funds (pay attention to the fine print regarding "load" if you don't plan to hold them for long-term).

If you have the stomach for it, it makes sense to have a portion of your holdings in real estate. Take your time when investing in real estate... don't go for "flipping" unless you're an experienced contractor. Calculate what your return will be from rents, after deducting for taxes, insurance, utilities, maintenance and at least some vacancies. If you can realize a good 5-10% return from rents, and can buy in an are that's on the upswing, than it can be a great investment.

Money managers/brokers don't do any better than you can do if you do your research. At least that's been my experience (I have portfolios with SWS and JP Morgan, and the portfolio I manage myself is doing a lot better than they're doing).

Use common sense and listen to your gut... if your gut says something sounds fishy, just say no. You'll get a zillion email "tips" from the "experts"... many of whom are just trying to save their own sorry positions by convincing you to buy the turkeys they got suckered into buying.

[TsonicTsunami08]

Put 5% in Bitcoin and it will out perform anything you can throw up against it!

Watch this:

https://www.youtube.com/watch?v=qHUPPYzzZrI

[CGASMIA68]

Call these guys
http://www.convergentwealth.com

Convergent Wealth

[Georgia Girl 2]

Sturm Ruger.

[jdsteel]

Hire a professional. If someone gave you an airplane would you try to do your own maintenance?

[Lurkina.n.Learnin]

Bump for later

[bunkerhill7]

Only way to make 4000%+ in one year:

Disruptive startup before it starts up

Disruptive startup before IPO

Ground floor is only way to get on the elevator to this Penthouse.

Otherwise you`re just a steer in the herd headed for the slaughterhouse coz steers don`t no nothing about Kansas City nights.

[snooter55]

Sorry for the loss of your dear relative.

GIVE THE COOL MILLION TO JESUS CHRIST - CHEERFULLY ( without doubt, concern of the sense of “loss” or any other negative feelings ) and He will bless you with more “returns” than ANYONE visiting this thread could ever in a MILION years even imagine. Yes, even if you don’t hold Him dearly as your King and Savior. However should He be your Lord - fasten yer seatbelt buddy !
Sincerely,
Snoot ;o)

[reaganbooster]

I think I would buy a chunk of primarily farm land and lease it out for farming. Plant a house on a wooded portion.

That’s excellent and wise advice, crip. Good farmland will produce a nice cash flow and over time will continue to appreciate, acting as an inflation hedge. There always seems to be alot of farmers willing to cash rent or buy good farmland at irrationally high prices. Besides that, you’ve got a good place to go when the SHTF.

[Gay State Conservative]

North Dakota oil and gas.

[frog in a pot]

...honour and family ties matter more than quick thrills.

What a remarkable and wonderful mindset. Your recently departed relative is very pleased.

With such an attitude you likely consider yourself a family trustee or guardian of the funds; if so, that bodes well for your investment plans. Wish you good luck.