Will Inherit Upwards of 25m, what should I do?
I will inherit upwards of 25 million from my trust at the age of 30. I have always been incredibly motivated about school, but also want to have a fun life and set up a good future for my children. I currently have a 3.9, go to a target for IB, and a great network. I am currently studying math and econ to hopefully pursue a PhD in Economics at a top school. My thinking is that I want the WLB of a professor or World Bank, and the prestige of writing academic papers and giving conference talks, something I very much enjoy. The problem I’m facing is that living a lavish life would cause my wealth to grow slower, and I’ve always wanted to pursue entrepreneurial work and don’t know if its too risky. I don’t exactly know where I was going with all of this except: I will have 25m by 30 and am very motivated and am looking for the peak career, where I can basically do anything I want, whether that’s a vineyard in France or teaching at university or managing a business.
Decisions, decisions...such a tough life we all live.
Well first let me start off by giving you props and respect. Good to know that you're not letting the money go to your head. Think about the inheritance as a safety net, but not as a primary means of income. Take 90% of the money and put in stocks, bonds, RE, etc. Keep it in risk-free assets. Keep the remainder $2.5M on hand for spending on yourself, maybe do a startup, do whatever you want. Assuming 90% of your money ($22.5M) will return a 3% yield, thats $675K pre-tax. I highly doubt you'll even use up the $2.5M anytime soon. Meanwhile let your portfolio grow. Mentally just act like this money doesn't exist.
Thank you for the advice, I hope to never touch roughly 80% of the principle inheritance and just let that grow in diversified funds until my kids are ready for it. Do you have any specific recommendations on career options I could pursue?
Honestly, it comes down to what your interested in. Are you interested in tech, climate change, food, etc? The best part about being in your position is that you have the ability to fail and still get up and try again. Most people in this world have that fear because they can't risk put their livelihood on the line. I am personally into RE as my primary work/career, but have a huge passion for cars and always wanted to own a dealership (yes, I am aware they don't make a ton of money and margins are thin) but it doesn't matter because I be in an environment that I would absolutely love.
Give him a 4.5% yield on that money, then take away 2% for inflation, realistically leaving him with only 2.5% to work with
Inheriting this money when you're 30 is an interesting time. This means you can take significant career risks throughout your 20s and even if it doesn't work out, you can fall back on your inheritance later. You could certainly go the PhD route since you basically will have no opportunity cost of working, but on the other end of the risk spectrum, you could work in startups for 8 years so that if you become interested in investing later on, you could do as our RE VP mentioned and take a small chunk and invest.
How would you recommend I “go work in startups,” I’m minoring in CS, so I could enter as a SWE, but I feel it’s really hard to enter startups as either a quant or financial analyst, and I would be starting from the bottom.
This was a depressing read from the walls of my shithole 100 year old apartment
I felt that fuck this shit
I’m sorry y’all, I’m just trying to basically find the best possible achievable career for myself. I can’t see myself living without working and I feel I need something to do, but don’t know what it should be.
Just start your own business
Borrow as much as you can against it and buy bitcoin. Thank me next month.
bitcoin is going to 0 my man
just gamble it on Binance futures with 20x leverage. any shitcoin is fine
SHIB
This week:
Imagine putting in 20 million in a shitcoin and getting back hundreds of million dollars. Time to buy a yacht.
that with even 10x leverage is a 7x return. 150 mill in a week aint bad.
I would spend all my time getting girls, traveling, and using passive income to fund those desires tbh
Nice
My principle inheritance wouldn't grow though, I also feel like shit becuase I would never accomplish anything.
25m should be enough for the rest of your life without any growth.
also what would you accomplish otherwise? become somebody's bitch in a corporate world? how important is that?
+1
You need to find your long term partner before they know of the money or you're going to be paranoid over your relationship forever.
Feel like this is probably one of the more overlooked comments.
And be extremely selective over who you disclose your wealth to, lest it open a Pandora's box of unwanted issues over jealousy, attracting opportunists or people with ill intentions. Actually if I was you I'd just keep it a complete secret.
Both your comments are my goal, only my family knows and overall (outside of travel and food) we tend to live a pretty frugal lifestyle. It's why I mention something like a vineyard or farm. I would have no problem living in a remote location, but I would need a job to do, and I've always been drawn to economic research I just don't know if its the best option.
1) do not tell ANYBODY
2) get a team of advisors to help you (legal, tax, financial) but be wary of AUM fees from advisors. I'm assuming you can use your parents people here. Big things are going to be asset protection and tax strategy. From an investment perspective no need to get overly complex and buy into expensive products.
3) figure out a way to work that is meaningful, allows you to be your own boss, and preserve your wealth. You should never have to request a PTO day the rest of your life.
Do this man. $25M is a lot of money for anybody, especially getting it all at once, so you'll definitely need some help with structuring/investing it in the interim until you have a better grasp with how your lifestyle will inevitably change. Similar thing happens with people who win the lottery, but you already asking others about it is a good first step, but definitely focus on finding good advisors for now. I'm sure there are a lot of people on WSO who could refer you to some vs reddit where everyone is a brokeboi.
Respect your desires, but also keep in mind life changes. The money gives you flexibility to put the brakes on work to spend time with future family for example. Sounds like you have no huge desire to allow it affect your short-term decisions, so don't. Go chase the "prestigious" career, and then if you ever want to change your mind, you can. The other option as others have said is it allows you to take more risk - you don't have to take the prestigious job, you can instead chase jobs that give you skills / follow your passion to enable you to do the things you want to do later in life (want to start a company? join a startup. want to own a vineyard? become a sommelier, etc.)
I have the impression that recently half of the WSO users inherited several million dollars.
Be the professor who wears a nautilus to class and has all the kids wondering how you can afford a 100K watch on a professor's salary.
Who the fuck wants to be a professor and have to deal with all of the blue haired fat chicks complaining constantly?
thats the goal, you perfectly understand the career I am going for
Receipts or BAN
My problem with your comments is that you reference not wanting to start at the bottom. That is how you build a skill set. Just because you have money doesn’t mean you won’t have growing pains and a need to learn. If you want to start at the top then take 1/2 your money and buy a business. That doesn’t mean you will know how to run it.
I understand all of your criticism. The way I am looking at it is that, yes I want to develop all of the skills to do whatever I want to do, but also at the same time, I don't want to spend 10 years in a corporate ladder if at all possible. All of this and my interest in research, has led me to believe a 5-6 year Econ PhD, where after that I am effectively my own boss at a university or relatively free to do my own work in the private sector/world bank, is the best possible option for me. Also, through this process, I can also develop some of the skills to run my own business, while I can't do research and have the same QOL when I'm a VP in IB.
First idea. Get on bizbuysell and buy a business you feel confident you can manage. Make sure you reconcile targets cash transactions to financials and renegotiate deal terms. If you don't feel confident doing due diligence yourself then get some help on Upwork (affordable hire).
Second idea. Get a Bloomberg terminal and publish economic/quantitative research for a subscription. Easier said than done considering overhead, legal complexity of research, and gaining traction.
Pick a vertical, find a tenured partner you can trust and start a business.
It's a very big world out there and there is a lot you can do with $25MM. You're obviously a smart guy, but you may benefit from partnering with a seasoned industry expert to launch a venture.
As you're interested in econ, perhaps getting a PhD, spending a few years at the World Bank/IMF and then launching a macro fund w/ a season macro guy makes sense. It would also present the opportunity to build even larger wealth. I'm sure you can find a ton of PMs at a BH/Rokos type fund who would chomp at the bit to launch their own vehicle.
If not, academia is a fine profession as long as you enjoy writing papers.
Best of luck!
Isn’t macro dead post GFC? Worst performing hedge fund class I believe. Not much arb when central banks don’t allow there to be any.
Even though 2021 has been a more challenging year for macro, I wouldn't call the strategy dead by any means. For example, BH (main fund) was up 27% in 2020, it's best year since 2003. Several others has very strong 2020s as well.
Regardless, I'm merely suggesting macro as it fits your interests. The beauty of investing is the field is very wide, there is always something to do and there are plenty of strategies that can start with ~$25MM. I can name a few mid-sized HFs (none in macro as that's not my area) that started when one wealthy individual and one seasoned industry professional combined forces.
Best of luck!
Put $20 million in safe investments. Honestly just give it to a wealth management person or something so you don’t have to manage it yourself. Use the other $5 million to do something entrepreneurial that you’re interested in
relax its only 25mm
Imagine having $180mm like Elon and him investing it all in three of his own businesses (Space X, Solar City, Tesla). I mean the balls on that guy - right?
VTWAX and chill…
I've known some old people who had a ton of money their entire lives and just started crushing alcohol and drugs. They get bored and start to rely on alternative means of happiness. The people that did not do this spent a lot of time focusing on their health and cultivating a close group of friends. Try and find activities that are healthy and build strong relationships that will last the rest of your life.
Also your most important decision you will make is who you marry, be careful a bad wife can ruin your life.
Put it all on Exxon Mobil stock and enjoy dividend life
Buy TQQQ and you will be a billionaire in a decade. It's worth the risk bro, trust me.
Fr?
if you put 25m in TQQQ during inception 11 years ago you would have 4.3B now. Honestly, if I had 25M I'd just throw half of it in TQQQ. Difference in quality of life between 15m and 25m is negligible. Difference between $x bn and 25m though?
Came back to let everyone know this would have been a terrible idea.
Horrible idea lmao
What do you enjoy doing? Being an academic economist and entrepreneur are veryyyy different things. I worked for the world bank on their short term program, but on the grounds not as an academic I would say that is one of the best places to work if you enjoy charity besides of the gates foundation, however I do not really think that this is what you are looking for. It is really brutal to be a successful academic or entrepreneur, I can not imaging anyone choosing these carrer if they do not really have a deep love for the subject, especially if they do not need money. Almost all my chilldhood friends are math academics and they loved the subject more then anything in their life and I do not think that economics is very different from that.
I do not know how old you are right now, maybe you could do a predoc on a top 20 uni or a small business to see if you enjoy?
On a side note if you are independently wealth and do not have geographic restriction studying at a top US university you probably can get a research position on some university around the world do some cool research and chill, if you want to get tenure at any decent american university/FED/IMF/WB is going to be very very hard tough.
BALL
Stop bragging.
Nobody cares that you didn't have to work for money.
And I thought a few million is good lol
25 Million? God dam! I've never even seen a million in my life. Slaying away all day depressed, working my ass off like a dog. I'm not complaining man. You have it good. Live life a little in your 20's. Hopefully this covid thing goes away. Take some risks in your 20's since you got that trust fund at 30 to fall back on. I think the biggest thing is don't let the money get to your head. I never had money growing up and still don't. In fact, broke as fuck, but I'm making progress. Make good of that money. Give back to your community a few times a year on things you care about like thanksgiving and christmas. That's coming from someone who never had a single christmas growing up. It's all good though. My future and my kids will have Christmas presents! Live it up! You set!
Never happened.
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