Reply to What would you do with 500k cash gift?

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[quote=Anonymous][quote=Anonymous]Not exactly a gift but I will receive ~500k that’s non taxable in 6-12 months - mid-30s married professional with 2 young children. I have an underfunded 401k so plan on maxing out contributions to all retirement vehicles, paying off my student loans (40k) and putting money into my children’s 529s. I’m interested in investing the rest in the stock market or real estate. Just curious what you would do to invest that amount - or 300k of it. HHI is 230k (split almost evenly) and house has 200k equity - no other debt beyond my student loans. [/quote]

- Pay down student loan - $40K
- Fully fund 401K - This year and set aside money for next year as well.  Keep this money in a high yield savings account.
- Superfund kids' 529 - $200K (100K each).  If kids are really young, just invest in the market index within the 529. Spread investment over 10 months.
- Remaining $200K (approx) - Invest in index funds @ 20K/month for 10 months.  You could also consider other expenses like buying a new car, home remodel, a nice vacation, etc. from this bucket of money.

For 3 & 4, spreading over a period of time gives you the benefit of dollar cost averaging.. not that it matters in the long run but why not?  Univested funds can remain in a high yield savings account while they wait to be invested.[/quote]

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