Coming into money

[Anonymous]

Anonymous wrote:

Anonymous wrote:My husband runs all of our money but we keep some at Wells Fargo. If you keep enough money with them, you have access to their high net worth advisors. Most banks offer these services.

We have investments with Fidelity, Vanguard, and Hartford. I'll see what they can offer.

Vanguard and Fidelity are great companies. Stay away from Hartford for anything other than term life insurance, they will try to sell things like whole life insurance and high fee annuities.

[Anonymous]

Anonymous wrote:1. You do not need to hire anyone.

2. Just pay off whatever debt and then put the money in a total market index (like the VTSAX mentioned above).

3. Sleep well.

4. Profit.

Ugh. No, do NOT put all your money in a total market index. You need some money in cash and some money in bonds, and then yes investments. That’s literally finance 101. 5-10% cash, 10-20% bonds (I’d don’t know how old you are, but this is appropriate for middle age). As you get older you want less exposure to the market. But the big take away is you need financial advice since you are crowd sourcing DCUM and also indicate you have no financial discipline.

[Anonymous]

Paying a percentage of assets is just a bad idea for most people

Definitely NO percentage commission- flat rate only if at all possible.

Ask a good friend for a tax attorney number and start dialing. Congrats on realizing that you need some guidance in order to best use this windfall!

Use a portion of the money right now to take a cruise and just think about things for a minute.

[Anonymous]

OP Here.

I was thinking an attorney to do a proper estate plan, an accountant to make sure we do our taxes right since our taxes have been easy enough that I have been able to do them and I don't want to mess up with so much on the line now, and the financial planner to help us invest wisely.

The house will be paid off in less than 5 years without the windfall and we have no other debt, but we are cash poor since I quit working in 2020 to stay home with the kids 10/12. Most of our money is in 401k's, Roth IRAs, and 529s so not easily accessible. We have about 1/3 invested mutual funds and bonds. We do have a few individual stocks to get the kids interested in investing. I would love to do a major renovation of our home and travel.

We bank with a credit union. Would it be better to open an account at a large bank instead of using our large credit union?

I'm reading Bogleheads. Thank you for sending me to that resource.

[Anonymous]

Anonymous wrote:OP Here.

I was thinking an attorney to do a proper estate plan, an accountant to make sure we do our taxes right since our taxes have been easy enough that I have been able to do them and I don't want to mess up with so much on the line now, and the financial planner to help us invest wisely.

wills, advanced directives, trusts, and dpoas for a family should run you a few thousand dollars, and are definitely a good investment. i used wflaw.com in bethesda.

if you are inheriting investment or retirement accounts that may have distribution requirements, yes, a tax accountant might be a good plan.

We bank with a credit union. Would it be better to open an account at a large bank instead of using our large credit union?

i don't think that's really necessary yet-- you said you have vanguard and fidelity accounts, right? i am fairly certain either have advisors that would be happy to advise you about funds, cash mixes, etc.

[Anonymous]

Anonymous wrote:

Anonymous wrote:A lot of financial advisors are not particularly savvy about investing & also charge a % of your assets that they manage. Be very careful about getting sucked into that racket.

This is completely legitimate and how financial advisors make money. If you want help from a professional, be prepared to pay for it.

+1

I don't use a financial advisor, as I am interested in these subjects and do it on my own. But they provide a legitimate service to those who need it, and it's not a scam for them to be paid. Imagine the racket of dentists cleaning your teeth...and then expecting to be paid!

[Anonymous]

I would use a Vanguard advisor because my money is already with them. Maybe check it out and see if that would work for you.

[Anonymous]

Just throw it in a broad market mutual fund. You aren't the Rockefellers.

[Anonymous]

One way to minimize fees with an advisor would be give them a portion of your assets. Let's say the advisor you pick charges 1% for sums under about $1M and the fee drops to 0.5% after $1M. You could give them $1M and they do a good job, copy their investments in your other accounts. If that gets tiring, and you don't mind paying the fee, give them all your money to manage.

[Anonymous]

Anonymous wrote:1. You do not need to hire anyone.

2. Just pay off whatever debt and then put the money in a total market index (like the VTSAX mentioned above).

3. Sleep well.

4. Profit.

+1
This is your plan OP

[Anonymous]

Anonymous wrote:

Anonymous wrote:1. You do not need to hire anyone.

2. Just pay off whatever debt and then put the money in a total market index (like the VTSAX mentioned above).

3. Sleep well.

4. Profit.

Ugh. No, do NOT put all your money in a total market index. You need some money in cash and some money in bonds, and then yes investments. That’s literally finance 101. 5-10% cash, 10-20% bonds (I’d don’t know how old you are, but this is appropriate for middle age). As you get older you want less exposure to the market. But the big take away is you need financial advice since you are crowd sourcing DCUM and also indicate you have no financial discipline.

When you need cash, sell the VTSAX. Bonds - eh, not what they used to be.

[Anonymous]

Anonymous wrote:

Anonymous wrote:A lot of financial advisors are not particularly savvy about investing & also charge a % of your assets that they manage. Be very careful about getting sucked into that racket.

This is completely legitimate and how financial advisors make money. If you want help from a professional, be prepared to pay for it.

Or, you could spend three hours on Bogleheads, and achieve better results yourself.

[Anonymous]

Anonymous wrote:OP Here.

I was thinking an attorney to do a proper estate plan, an accountant to make sure we do our taxes right since our taxes have been easy enough that I have been able to do them and I don't want to mess up with so much on the line now, and the financial planner to help us invest wisely.

The house will be paid off in less than 5 years without the windfall and we have no other debt, but we are cash poor since I quit working in 2020 to stay home with the kids 10/12. Most of our money is in 401k's, Roth IRAs, and 529s so not easily accessible. We have about 1/3 invested mutual funds and bonds. We do have a few individual stocks to get the kids interested in investing. I would love to do a major renovation of our home and travel.

We bank with a credit union. Would it be better to open an account at a large bank instead of using our large credit union?

I'm reading Bogleheads. Thank you for sending me to that resource.

Pay off the house, spread 2/3 of the money into Vangaurd type funds, and also invest in tax free bonds in whatever state you are in. If you are in DC, then ANY municipal bonds in the US are tax free. That will keep your taxes simple, the Vangaurd investments will grow/compound and you should be deriving enough cashflow to ease your day to day life.

[Anonymous]

Anonymous wrote:Seven figures. Net worth is around $2 million between home, IRAs, 401Ks, stocks, etc.

Well $1M is very different than $9.9 M, which end of the spectrum will it be?

Either way, I'd recommend paying off the house, fully saving for college for the kids as a starting point.

[Anonymous]

Anonymous wrote:A lot of financial advisors are not particularly savvy about investing & also charge a % of your assets that they manage. Be very careful about getting sucked into that racket.

+1

Right now you can distribute it between online banks that will get you 4-5% in Money Markets and CDs. Distribute it so that it is all fully FDIC insured/NCUA insured if using Credit Unions.
You can put it in those immediately, keeping some in MM that is fully accessible without a penalty while you decide what to do, all while earning 4-5% currently.