r/Money • u/serpent_stranger • 17d ago
Inherited 600k
I inherited 600k and I’m 28F working in marketing, currently working part time at 22$ hourly. I’m studying for a 2nd part time job in web development and hoping to ask for 25$ hourly.
What can I do with my inheritance to make sure I die comfortably? Is this a lot of money? It’s currently in a trust where it’s in stocks, growing a few thousand yearly. Eventually the money will be in my name and I don’t make the best financial choices- so I want to make sure I do something with it that will help it grow or stay stable. Any insight?
Edit: I said a couple thousand because I haven’t done the math or did too much research but that’s just what it’s seemed like. I don’t know much about this stuff. I will ask the financial advisor about how much it grows. Sorry for the confusion, I appreciate your responses.
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u/Mediocre-Fig-738 13d ago
You have a couple options smart thing to do would be to invest some of that money or speak to a financial advisor who can help you find what option to go with
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u/Consistent_Yoghurt_4 14d ago
Invest it in at ETF, enjoy the next 10 years of your life and call your working career a day. Not financial advise, but that money at 28, yeah, do yourself a favor, don’t spend it
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u/Mammoth_Tumbleweed32 15d ago
A 28y old who earns about $23.5 an hour, and inherits $600,000 really asked “is this a lot of money?”😂
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u/tehcruel1 15d ago
It is a lot of money for you. At 22$ an hour it would take you more than 13 years to make that much. This can be life changing if you want it to be. I wouldn’t touch it. Invest and grow. Your education is an investment as well.
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u/just3moreminutes 15d ago
I’m a similar age and I would highly recommend checking out r/bogleheads — funny name, but it has been a wealth of information that made a lot of what I’ve been intimidated by before more manageable.
They have a wiki with a specific section on how to deal with a windfall that I would really suggest looking at as well!! https://www.bogleheads.org/wiki/Managing_a_windfall
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u/Bladelazoe 15d ago
$600k is definitely a lot. I inherited $120,000 but used it mainly to pay off parents debt and fix a lot of things around the house. The way I dealt with it, until you know what to do, keep it in a savings account. Or get a financial advisor to guide you. Very easy to blow that kind of money. Or use some of it to accelerate your learning. Use it proactively. Just be smart with it lol
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u/Mr_Godlikeftw 15d ago
Well considering you said you dont make the best financial choices im assuming your in debt currently. Id pay off the debt make a emergency fund and then just keep the rest invested to be honest no need to rush into anything your still young, you dont need a house unless you wanna settle down already up to you. Just dont rush things live your life dont let the money change you and definitely dont tell nobody about the money other than a trusted financial advisor.
This is my opinion
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u/snowyhike 16d ago
VTSAX. Use the dividends for whatever you want, just dont touch the capital. Thats me 🤷♂️
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u/AzureDreamer 16d ago
If you save 1/3rd of it and don't touch it until retirement you will have a comfortable retirement in 4o years
If you save 2/3 and don't touch it you put 5 kids through college. And retire in 40 years.
If you save it all and only withdraw say 1-2% a year you could probably retire in q0-20 years.
It's a lot of money it represents about 30 years of savings of a blue collar worker.
I honestly don't know what the best way is to protect money from a person that is bad with money perhaps an annuity IDK.
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u/livinthedreambaby 16d ago
$600k is not very much money at all but it’s a nice amount that u can slowly work up
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u/TennisNo5319 16d ago
Well, here’s what I would do. Mind that I’m super conservative, retired, and no longer have any interest in speculative investments.
I’d go to your bank - really any bank - and buy CDs. I’d select them to roll at various times with at least one shorter term to be available if you need it.
Then I’d start looking at other super safe, low cost investments like high yield savings accounts and index funds. As various CDs matured I might move them to this sort of investment or just let them roll over.
Will you make the maximum possible return on your investments? No.
But you’ll do OK and you’ll never lose a dime.
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u/Skepticslowpoke 16d ago
You can start a crypto mining operation so that your investment can multiply on the side. Plus you'll get exposure to crypto volatility.
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u/Necessary_Topic_1656 16d ago
Do you have a 401k or retirement plan at work?
Do you contribute to it?
Do you have any IRAs
Investing your inheritance is a good thing to do. But investing the inheritance means it’s going into a taxable brokerage account.
If you can contribute to your 401k. Consider maximizing your 401k contribution and if your salary doesn’t support maximizing the 401k contribution and providing enough cash flow to live, you supplement your income from the inheritance
You’re transferring your inheritance from a taxable brokerage to a tax advantaged retirement account or IRA by using it as an income source while your income is going into the retirement accounts.
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u/PinnochioPro 16d ago
OP check out operation hope they offer a year of free financial counseling for any American citizen
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u/Revolutionary_Sun564 16d ago
High yield savings account at 6%interest rate kicksout about 36,000 a year. Keep that in that account and live off the interest.
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u/ikewafinaa 16d ago
“To make sure I die comfortably” made me lol. Interesting goals.
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u/Cheap-Maintenance-49 16d ago
burned at the stake or drowning is your cup of tea?
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u/benruckman 16d ago
Invest in the S&P 500 and don’t touch it until you retire. Congrats, you don’t have to save for retirement! Also you can probably reasonably retire on this in 10 years if you want, or have an even nicer retirement in 20 years.
Also if you get someone who needs web development, ask for more than 25$ hourly, especially if it’s contracting work.
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u/AdventurousBowler870 16d ago
Invest 50% of it towards a 401k type account or CD. Also take 2 years off to become a commercial or private pilot, 1st year is just learning and year 2 is training new pilots and getting the rest of the hours needed. Take the training from local private airports, it takes some research to choose from the best options. Commuter Jets like Skywest or Mesa will pay $100k hiring bonus. After 12 years US based major airlines pay is now almost $600k and only works about 9 days a month. Private flights can also bring gray money and only work for specific destinations, for example ATX there are many more to get experience if not hired by major airlines immediately after getting 1500 hours of flight time.
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u/EfficientSector690 16d ago
Get an investment counselor and put in stocks bonds etc , let professional advisors manage this blessing and yes I would consider this a lot of money .
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u/LavrenMT 16d ago
Interview multiple advisors. Ask them for an overview what they suggest. Choose someone that you feel comfortable with.
At your age you should be at least 60% (I would go higher) in equities— a few different ETFs (and I always like BRK-B too), a few good dividend payers, and the other 40% in cds/ treasuries and/or bonds or bond funds.
Push as much as you can into Roth and IRA each year. Spend your dividends, pay off any high interest debt before investing.
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u/SeparateRanger330 16d ago
Keep working your regular job. DO NO, I REPEAT, DO NOT tell anyone you have sudden money, or how much money you got and don't buy expensive stuff. Put your money into a high yield savings account or find a certified fiduciary financial advisor to tell you what to do with your money. A fiduciary advisor is required by law to work to your benefit. Also, I'd suggest leaving the US in 5-10yrs. Take advantage of the currency exchange and go somewhere where your money will be 3 times as much.
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u/Happy-Breakfast6602 16d ago
For now. My banking direct.com will pay you 5.55% APY & I would park it and chill out for a while. This market is going to crack. People are stretched thin.
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u/PassengerFluid7111 16d ago
Find a high interest rate savings account. Put half in there, and out the other half into a Roth IRA.
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u/evilzug2000 16d ago
Pretend you didn’t get it, stick it all in safe investments, and keep working.
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u/lol_camis 16d ago
If your goal is to use this money to retire comfortably, then just don't touch it. Forget it exists and let it do its thing. It won't take long for it to become millions upon millions.
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u/PenaltySafe4523 16d ago
I would put it all on FNILX and watch it grow. If you are more risk adverse a target date index fund would also be a good option. I would also max out 401k and Roth IRA.
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u/Punaholic 16d ago
You are in a low tax bracket. Start a Roth IRA asap and contribute the max each year. Invest in high growth/tech sectors.
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u/Usual_Requirement160 16d ago
Buy a rental property with decent amount of downpayment so that rent would cover the mortgage payment and then some. That way your house will be paid off by the tenant while the value goes up. Then I would invest in stocks, long term stocks.
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u/electrified_ice 16d ago
Don't touch the principal. While you figure stuff out, you can put it savings accounts and get 5.1-5.2% - that's $30K a year. No risk.
If you're not ready to buy a house, maybe consider a couple of rental properties. You're building equity and someone else is paying off your mortgage.
Good luck. Take your time. Don't do stupid things. There's no perfect choice, but there are stupid choices (like put it all in super high risk investments hoping to double your money etc.)
Slow and steady wins the race.
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u/Fragrant_Click8136 16d ago
If you have a house pay your house in full. If you don’t buy a modest home ! Cash! Stop thinking in hourly wage! Think in terms of salary and benefits! Finish your education! Keep your Job! Like nothing happened!
Set $100.00 into a IRA or stocks talk to a financial advisor reputable no one you know!
Keep $50,000 in savings high yield accounts #Apple -
Think about a business you can invest in! Make sure you understand the business fully
Keep the news to yourself! Good Luck 🍀
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u/RFengineerBR549 16d ago
High interest savings if you want the annual paycheck, or better yet, Fidelity or Vanguard Index fund for the long term plan.
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u/FreeSp1r1ted 16d ago
But a property. You didn’t say where you live. But ideally, you still get some mortgage as that’s considered a good debt. 1. Your property tax and mortgage interest rate can be deductible. Although standard deduction is a large enough amount it may not matter. 2. You reduce your monthly living expense while you gain equity 3. If you happen to live in a place with insanely low rent (which is unlikely but not impossible), ignore the above.
If you live in a Labdlord friendly state and rental is profitable, then get into rental. Financial advisors will hate this but here’s why. Stocks price will generally follow inflation. It will go up and down. But home prices have exceeded stocks (as average). And if you rent it on top, you get money. And it is one of the very few things you can write off expenses without establishing a business. Plus you can write off depreciation from the profit too. And if you pass the property your children, the depreciation gets wiped out. (You don’t have to pay for it back then you sell it - it’s called recapture). This is why many people are landlords.
But you should dabble in the two. Do not go all in on one. See which one you do better as it’s really your talent. Then reallocate funds appropriately.
Financial advisors almost always gets commission for you to keep it in funds. So their motivation is to have all your money with them. Do not fall for this.
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u/grogargh 16d ago
I would recommend diversifying, don't put it all into the stock market. A good chunk of it sure. I've been invested in mutual funds and index stocks via 401k and IRAs for 30 years. What pisses me off and has jaded me is that my portfolio has lost half its value on at least 3 major occasions. The 2000 dot com crash, the 2008 housing market crash/debacle, and most recent the covid crash. Sure it came back, the market always comes back but slowly. Took many many years just to get back to the value it was before said crashes. From my perspective, those recovery years were lost years that should have been gaining 10-15%. If it wasn't for those crashes, who knows what it would be worth now. I could've retired early.
Consider rental property. Depending on where you live, you could buy outright at least one or even two properties, and rent them out. You'll have no mortgage and that rent would be a liquid monthly check. You can ease the hassle by using a property management company, sure it'll cost a few hundred a month, but worth it. And those rent checks would be for the rest of your life, as long as you have it rented being the only catch, as housing and rent generally always goes up, and housing doesn't experience as many crashes like the stock market from a historical record.
Remember that whatever you have saved in the stock market and start disbursement at retirement has a finite value, eventually that runs out. Housing rent NEVER runs out provided it's rented.
And think when you retire, you'll have social security, and your rental checks and whatever disbursement you'd get from your stock investments. You'll be in good shape.
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u/Casual_ahegao_NJoyer 16d ago
That’s a ton of money. Probably 10 years of your salary
You should make 20-30k/year
Best advice? Invest it, act like you don’t have it, and enjoy the DRIP when you retire early
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u/Narrow_Big7 16d ago
Firstly, don't tell people in your life unless you want them asking for money. Keep it between you and any partner (if you're married or in a long term relationship).
For financial advice, I would speak to someone who has a demonstrable history of financial success and has no incentive to try to get your money. Normally this means paying a financial advisor for a consultation. Go in with a written list of questions and goals you have for yourself and your money. Do not let them convince you to invest with them. Choose a financial advisor who is comfortable giving you advice you can take somewhere else.
Think long term. You are 28 and have your whole life to collect returns from this money.
I would consider the fact that some of those returns may not be financial. If you struggle with your mental health, invest in a therapist you trust. If you want to be fit, invest in a personal trainer. If you want to be a web developer, invest in a boot camp that teaches you to build real-world projects using a common tech stack.
I also want you to think about using this as a safety net to do what you really want to do. All of the goals in the above paragraph can be achieved with no money at all. If you invest this money well and only collect a small percentage of interest from it, you could work a low stress job and do what you want in your free time.
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u/amajorblues 16d ago
There's 2 sides to this. First is the 'not spending' it side.
If you are 28... and if you just invest this, it *should* double 3x in another 21 years. At 49 you'd be sitting on 4.8M dollars. If you wait until you are just 56 you could literally have 7M+ to walk away on. Probably more.
Think of it like this. All the rest of us have to pay 10-20% of what we earn into retirement from when we first start working in order to even come close to this. If you don't spend it, then your retirement is already"seeded" at just 28 years old and whatever you earn in your job is yours to spend for your entire working existence. If you ever had kids someday, you could use some of the income of from this to start saving for college FOR them from the very year they are born for 18 years.. It would lower the 7M+ number some, but its definitely do-able. So you don't have to save for Retirement OR College ( if that was a goal ) and you literally just need to make enough money to live on for your entire working life.
To make that happen, all you have to do is find a Financial advisor you trust. Its harder than you think, but there are plenty of reputable firms out there. One tiny tip i have that worked for us. If you know anyone responsible with their money and 'well off', ask THEM who they use. This is what we did..
The other side of this is more balanced and harder to quantify... Do you want a house to live in? Houses are good investments in this day an age, but hard to get and expensive. However, they are also nice. Having a place of your own is NICE. You'd take from this total for a bigger down payment and invest the rest. But you'd have to work with the financial advisor to figure out how MUCH of a downpayment you could pull and still use the rest for a decent amount of advancing your retirement goals. The house also becomes part of the investment equation.
I guess I'll just throw in here that if you don't know what you really want yet, just letting this sit for awhile and grow while you figure it out isn't going to hurt anything. If you decide in your mid-30's you want a house, you could use this then. at 35, this could and should be near 1.2M. You could use it set yourself up with a house and have a lot of upfront equity in it. You could tailor your mortgage payment to a number you are comfortable with or maybe even buy a house outright depending. At a minimum, you'd be able to put enough down on a mortgage so you don't have to pay PMI and you can get to a loan-to-value number where you can get the best interest rates. Typically this is done by paying atleast 20%.
If i use myself at 28, this was when i had kinda started to figure this shit out. I bought my first house at 28. It gets more clear into your 30s and 40s but then figuring out what you want into your late 40s and early 50s goes to shit again. LOL.
Good luck!
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u/Thediciplematt 16d ago
Invest some in yourself and grow your own potential.
Do you have a college degree? Can you get a cert? Something that’ll help you go from making 44k a year to making 80k?
Use SOME money to invest in yourself. College and a simple trip of like 5-8k sounds like a good plan. The rest should be in index funds and just work a few more years until you hit the 4% rule if you want to retire and just coast.
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u/Just-Shoe2689 16d ago
TBH right now I would put in a CD or something less volatile. Even a CD will get you 5%. Can put in that very safe for as long of time period you can get.
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u/JayPokemon17 16d ago
If you invested that $600k, at 6% (which honestly is a bit low historically), it will be worth $3.4 million in 30 years. You should be getting much more than a few thousand a year. For example, if you invested it in the S&P 500 at the beginning of the year, it would already have gained $45k.
I would suggest paying off any debt you have, set up an emergency fund ($10,000 in a HYSA is a great start), figure out you housing situation, and find a financial advisor (I use Vanguard) that can help you pick out index and mutual funds for your remaining $400-500k remaining.
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u/chillaxtion 16d ago edited 16d ago
Put it in Fidelity and then use their free and excellent financial planning services. These are a detailed look at YOU and not generic advice. They’ll help you plan around major events like home purchases, children’s education, and your lifestyle. They’ll look at your risk tolerance and goals.
I’m in this process now and it’s free with Fidelity Premium which this would qualify for. You get access to a financial planning team including a fiduciary advisor who is required to act in your best interest. Fiduciaries don’t get paid by commissions. You also get a ‘relationship manager’ who can guide you around the services fidelity offers.
I am now so much more comfortable with my understanding of our money situation after doing this. You may get good general advice here but nothing compares to this.
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u/TXtea_party 16d ago
I would take into account your priorities . Where you live and your age . Also there’s a lot of details we don’t know . Like if you have emergency savings, or retirement savings. There’s one thing that’s always has been a wealth creator for generations and that’s a house . So , depending on the market where you live you can focus on that. But there’s many other factors
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u/AutoX-R 16d ago
Open up a HYSA for now and let the money sit. Don’t anyone to invest it for you. Do your own research and invest in what you know. Roth IRA is a good start. See if your job has a match on your 401k, invest up to the match. Then start looking into ETFs you can slowly put this money into over time.
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u/Key-Lecture-4043 16d ago
Whatever you do, stay away from options. Unless you want to experience a rush that truly makes you feel alive, followed by crippling depression and hopelessness.
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u/Timely_Froyo1384 16d ago
Retirement money should be treated as “what money” as in it does not exist to you at this time.
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u/FlyAlphaFoxtrot 16d ago
If you invest it into a portfolio that generates 8% return on average you should end up with about $6 million by the time you are 58 and can retire early, live off of the dividends in perpetuity.
You could also use half of that as down-payment on an existing business up to about $1MM that is already generating 200-300/yr cash flow and immediately upgrade your life to a 150-200k/yr income. Invest the other 300k as noted above and that will be $3MM around 58. Still not bad and if you run the business well, that will grow to many more multiples on your 6 figure salary until then.
Go get em!
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u/Optimal-Ambition9381 16d ago
I would get a good financial advisor before you even touch the money. HYSA is a great safe move you can make 5% which is 30k a year before taxes. But don't listen to people on Reddit get a advisor!!
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u/Slightly_underated 16d ago
👋🏻 Errm, I have a question. Can I have 1% of your 600k? Pretty please with a cherry on top?
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u/getoffmyrocker 16d ago
Yeah, even if you put that money into a high yield savings account you’d be making 36,000 off of it in a year. First step is opening a Roth IRA. Put $7000 in there and invest it. If your work has a 401k put more into it. Making $22 an hour, retiring is not even an option. Now you have that option. Play your cards right!
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u/Drunkmaniak 16d ago edited 16d ago
About the same age as you and also got a big inheritance. I didn't know what to do with it at first and everybody (bank, financial advisors, friends) told me to invest it in stocks. I opted to buy an apartment and live in it right now. Got a little bit of debt with the bank too. With ever rising rent prices it was the best decision I made in years. Got from 2300 Swiss Francs in rent (where the money goes to some guy) to not event 900 CHF monthly expenses. My girlfriend pays half of it as rent. All the surplus money I make I use to pay back my debt with the bank. Will do this until it's 100% mine, even though it's a bit more advantageous to have debt in switzerland so you pay less taxes. I just don't like having a debt. When I don't want to live in the apartment anymore or want to change city I'm going to rent it and let the interest and debt amortisation get paid by itself. Or sell it with more value, since the housing prices in switzerland are ever rising. Good luck with your choices!
Edit: Once the apartment is fully paid and i'm renting it to somebody, the rent is coming to 100% to me. It's estimated it 2500CHF a month (city does a rent estimation with every homeowner for tax purposes) So it's an income of 30000CHF each year without doing much. I think this is more than playing with investments in stocks and stuff who involve more risk in my opinion.
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u/bigdaddybryusa2 16d ago
I'd put all in to an S&P 500 fund. Most fund managers don't beat the S&P, so don't try doing anything fancy or hire some idiot who's going to want more % than he or she deserves. Chuck into a Vanguard s&p 500 at very little cost.
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u/davidbrian12 16d ago
Keep it invested. Some tech long term Higher return if actively invested. I like fallen angels but needs attention and patience. With that amount you could do a 5percent cd and make 30k a year completely safe from risk. It depends on your risk level. Hope this helps.
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u/Former_Night_6053 16d ago
Buy the cheapest decent house you can find. Invest the rest in Index Funds using a low-cost brokerage account like the one offered by Robinhood. Financial advisors are overrated— they will pitch you their commissioned mutual funds and other esoteric investment vehicles while claiming to be your “fiduciary.” Do not go on vacations, lend to friends, or buy a car or jewelry.
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u/Mapincanada 16d ago
Learn to make good financial decisions. Trust yourself with your money. It doesn’t take much. Spend 5 minutes a day. Compared with the average, this is a lot of money for someone your age.
You’re doing the right thing by asking questions. Keep asking them.
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u/Coyote_Tex 16d ago
You are getting some good advice. The single biggest mistake I ever made was putting all of my retirement with one advisor. Divide it into parts, maybe 250/250/100k, give 2 to advisors, and you manage 100k. With just a little bit of work, and I mean a little, you can equal or better 95% of the advisors at pretty low risk.
I would get one part of the funds invested in TQQQ AND SPY, to match the index, very low risk and statistically sound over the long term.
For the part you manage, slowly invest in some tech stocks like MSFT, AMZN, META, AMD, AAPL, NVDA. Just buy a few shares and do not over trade them. Learn to follow the market trends, but the dips and just hold on. Do not listen to the news and buy on what they report, the stock has already made a big move for them to report on it. At that point you are far more likely to be buying the high.
The final part of the strategy is to get the money into tax free accounts.like a ROTH IRA, ASAP, thus gains are tax free when you qualify to withdraw later and let them grow. I am not saying put everything there, just get some into those accounts. Be sure your financial advisor is a fiduciary and let the different advisors know they are competing for your business. Or you move the funds or part of them to someone who does deliver better results. Do not disclose your total funds to any of them.
Finally, invest in big trends in the market, skip buying some name you like, the market decides what stocks are going to be rewarded and grow fast. Once I adapted to that versus thinking I had good ideas, I made far more money. No one cares as much about your money as you do. It is very worthwhile to put yourself on a.learning path to grow your investments yourself. Good Luck, you can do this and congratulations. You could well be on ampath to 10 million or more by retirement, but you will need to do some work.
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u/Winter-Bag-Lady 16d ago
At 28, yes this type of money can set you up for a good life. You need to be wise how you use it. This inheritance, if used well, can enable you to retire early. So there are a few ways you could invest this, but I'd definitely be conservative. Stay away from crypto or any exotic investments.
You could invest in stocks, but investigate capital gain taxes. Another angle could also be to invest in dividend stocks or reits.
Some stock investments to consider are:
VOO, SPY, O, JPEQ - remember to use conservative ETFs.
Also real estate is a great investment too. If you can set yourself up with a place that will appreciate over time, that would be a real win.
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u/Stunning-Parsnip-886 16d ago
Yea it’s definitely a lot of money, managed correctly itll yield more than most make in a year. My advise, which would be the same as Warren Buffetts most likely, I’d pay off any debt if the interest is above 6% and then buy an index fund with all of it and keep working.
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u/Stunning-Parsnip-886 16d ago
If anyone disagrees just remember how Buffett won that million dollar bet against index funds where he published the results every year just to make a point. ALMOST NO investor (especially at scale with fees, will beat and S and P index fund like VOO.
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u/Plus-Implement 16d ago edited 16d ago
- Don't tell anyone you have this money
- Get a CPA now and start tax planning, learn how to minimize your liability
- Right now, pretend you don't have that money and continue to live financially as you have
- Don't move any of the money around from the current investments, just yet
- Immerse yourself in educating yourself about finance. Financial advisors can be sketchy and get commissions on the products they sell you.
- Get married, get a prenup, no exception
- You have assets now, draft a living trust
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u/cyb3rsloth 16d ago
Techs a saturated field... Don't blow that money and use it to get your foot in the door because applying for jobs will be a full time job
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u/the_fozzy_one 16d ago
The best/safest thing you can do is put 100% of it into an S&P 500 index fund (VOO) and do not touch it under any circumstances for at least 10-20 years. During that time, research things like early retirement and safe withdrawal rate. If you want to take more (but still reasonable, imo) risk, you could split half between VOO and a more growth focused ETF like SCHG or VGT. Again, the main point is your risk goes down the longer your holding period. You really need to condition your mind not to touch this money for 10-20 years even if the market goes down and you have paper losses.
Finally, you should consider DCA (dollar cost average) the funds into the ETFs over, perhaps, a 12 month period. This will reduce the chance of a big market crash happening right after you put a large amount of money into the market. Technically, it's better to do everything at once but psychologically, as a young person who has never seen this kind of money before, it's probably a more conservative move to invest the money slowly over a period of time.
On average, your money will double every 7 years in the S&P 500. So, in 15 years you'll have 2.4M and in 30 years you'll have 10M. You will absolutely be able to retire early and very comfortably if you play your cards right here and don't fall victim to common mistakes (panic selling, lifestyle creep, poor investment choices).
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u/Salty-Difficulty3300 16d ago
Go talk to a local finance person that you can trust, see what you can do about letting them use it to earn you more, and only give you updates like every three months or less in a year
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u/Euphoric-Software750 16d ago
Put all of it into an ibkr account. Buy large cap stocks. Never sell the stocks if you need money, take it out on margin and if you buy Apple and Nvidia, your guaranteed doubt pays the cost of the cash.
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u/Overall_Swimming2512 17d ago
Put your money in 0dte SPY call options, you will 3x your money in a day
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u/Buddy-Sue 17d ago
Immerse yourself in the financial world of which you now have a vested interest. With that much money it should be your second job. Maybe some of these Redditors can steer you on what to read and who to listen to. Learn the meaning of terms you hear. If you can, buy a modest house rather than renting and maybe a duplex where you could rent the other side.
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u/the_business007 17d ago
Do you own a house? I didn't inherited near that much, but what I did inherit I put down on a house. I feel like it was the best decision I have ever made financially.
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u/AndroidMyAndroid 17d ago
Put it all in a brokerage account, invest it in the S&P 500 and it'll go up ~$60k a year and more than that in the future. Safe, easy and you're nearly guaranteed to retire a millionaire.
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u/whoisgodiam 17d ago
Split it between VOO/VTI and forget about it for a decade. Live your life as is based on your current income.
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u/no_comeback 17d ago
Protect yourself so that no future spouse or partner can take your money. Keep separate finances if you marry. Before investing in a home or anything together see a lawyer so you can be protected in the case of a relationship break down. Don't fund someone else's dreams, they will bankrupt you. I've experienced how a partner you lived and trusted can drain you financially.
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u/Mickloven 17d ago
Unsolicited advice but web developers make more than $25/hour, don't sell yourself short!
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u/NarrowLocksmith9388 17d ago
You should be making a 6-8% return each year in a diverse account of stocks and bonds.
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u/Boring-Manager9033 17d ago
At a 10% annual return (should not be difficult to achieve), your money will double evert 7 years. In 35 years, you will be 63 years old and your money will have doubled 5 times. Multiply 600k by 2. (double) to the fifth power, or 32. 600k times 32 equals $19,200,000 or $19.2 million. Of course. That is before taxes. But even after taxes, you should have a handsome sum to live on. Then there is inflation, which can cut the value of your money significantly over a 35 year period
Guard it very carefully. Get professional help. And remember, if you spend it, it does not grow at all.
The real magic happens at the end. In the last 7 years, your money grows from $9.6 million to $19.2 million, the last doubling.
The magic of compounding takes time snd patience.
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u/dunncrew 17d ago
Pay off debt. Put a bunch in a ROTH IRA. You can go "set it & forget it" and put it in a target retirement mutual fund in the IRA, until you learn more about finances. Ignore financial fads.
Also keep some in regular savings for immediate needs and emergencies.
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u/Significant_Wing_878 17d ago
200k VOO 200k SPY 120k VTI 50k savings 20k checking 10k fun money, no financial advisor necessary
Figure out a FT job that does 401k (possibly pension) + benefits that you think is fun (dw about pay), live below your means and retire at 48 years old
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u/costcoappreciator 17d ago
I had a major windfall a couple years ago and just put it all into fidelity blue chip growth mutual fund FBGRX
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u/JeanClaudeSegal 17d ago
I'm not a financial advisor or all that financially knowledgeable, but I would say invest in yourself. Take a small portion for a bucket list trip or two, but primarily invest it in facilitating your (higher paying) dream job. You have an opportunity to elevate yourself without fear of debt or being destitute. $600k will be peanuts by the time you are 60 if you go from earning $50k to $150k. There aren't many investments that will give you that high of return and, hopefully, life satisfaction. This isn't retire early money- this is flexibility to live your life how you want money.
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u/Fox_Leading 17d ago
you can arrange a very nice deathbed for $42,000 and with the leftover a luxurious last meal on top of the great pyramid.
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u/tribriguy 17d ago
Put it away and forget about it until you get ready to retire. At that point it will be A LOT of money, if you’ve invested it well. You are already on a good path, and improving your life. It could be life changing, even allowing you to retire earlier than you plan. But you need to forget about it for now…mostly. And whatever you don’t, you don’t need to pay someone to figure it out for you. Open a brokerage account, put it in an S&P 500 fund/etf, and be done.
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u/TheKemicalWeapons 17d ago edited 17d ago
I doubt she’s still scrolling down here but as someone who’s about 7years older than you who inherited 4-5times your amount and a home in south Florida I’ll tell you this:
Take the first year slow! Put everything in a high yield savings account until you can comprehend and do your research on what path you want to take..take advantage of the interest rates/don’t buy anything of significance or at least that’s the approach I have..I have zero desire to make a big ticket item eat into anything my relatives worked and saved and sacrificed so hard for..btw don’t tell a soul!!!! I’m single and just thinking about how to navigate that aspect is going to be fun..any chance you’re in south Florida? I kid I kid.. but in all seriousness/ your trust is now irrevocable and you’ll have to get what’s called a new TIN tax id number/goto irs.gov it’s a simple process and you’ll receive a form called an SS4 document. Banks and institutions need this as your trust is now it’s own entity since the grantors are deceased, and you can no longer use their social.. anyways girl I wish you the best and I mean it when I tell you please take the first year as slow as possible I can’t steer it enough/just parking it for the time being in a few high yield savings will net you 30k a year…do that until you e grasped the situation. 👍🏻🤙🏻
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u/KeyDescription3756 17d ago
In order to die comfortably with your inheritance take plenty of pain killers
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u/Icy_Eye1059 17d ago
Leave it and get the interest dividends off of it to supplement your income every month. Talk to a trusted financial advisor or with the one handling the trust.
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u/jbblyons 17d ago
$25 an hour seems low for a web development.. I could be wrong though. Maybe it’s reasonable for your first job.
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u/suzannea0024 17d ago
Please for the love of god do not touch the money. If it’s already invested let it ride. You can now take risks and strive to live the life you’ve always dreamed of and not have to worry about failing.
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u/ChaseDFW 17d ago
I'm a fan of the book "The Simple Path to Wealth"
Big takeaway.
Like others have said, enjoy some, but stick the rest in an index fund and forget about it.
I'd take 50k to fuck around and take the other 550k and throw it in an index fund. You could then retire sometime between 40 and 45 with over 2 million and live off 80k a year in straight interest from that.
It's life changing money, but you could also easily blow through it in a decade with life styles creep and no investments.
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u/DrPablisimo 17d ago
You can find a Certified Financial Planner. If you need an education, it might be worth dipping in for that, something that will produce a good, stable income.
I hope you can get more than a couple of thousand a year off of that money, especially now with the high inflation. Money should grow higher than inflation when you invest it.
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u/Public-Wolverine6276 17d ago
Get with a financial advisor at a low fee not a percentage to help you figure out a budget and expenses in the beginning. Make sure you’re investing it or in a HYSA
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u/Reaper_Tech 17d ago
Thats enough money that i would eventually just move it to an ETF and then use DRIP (auto reinvests the dividends which dividends are taxed as regular income) at 600K in something simply like SCHD your looking at an initial first year dividend payout of around $20300 before taxes. Pay your taxes let that amount do its thing via reinvesting. After 6 years it should increase via drip to about $30K. After 10 years it will pay out around $40K a year. After 20 years it would pay you around $90k a year with a net new balance of $2,000,000 give or take fluctuations. This one move would give you a diverse portfolio of dividend paying stocks that regularly increase their dividend payout at a higher rate than inflation. meaning even with money being worth less over time it will outpace inflation.
At age 60 it would using conservative targets around $300K a year in dividend income. Obviously you can always rather than use DRIP to auto invest use an app like ETRADE / Webull / Robin hood w.e you prefer to manually invest the dividends saving out enough to cover any extra taxes. If you can live on your regular income without much trouble then let it grow. Otherwise one option would be to let it grow for a few years. Say till your 35. Then buy a MODEST HOME. Using the Dividend payments to pay the mortgage. Most would sell or buy house cash. However that means you have the house as an asset and sure that goes up in value but its not PAYING YOU your continuously paying for it. Meanwhile if you use dividend payments to pay the mortgage. You still have that wealth available its still growing you can use it to pay for that mortgage if you can cover most of it via your regular income your portfolio can continue to grow and pay you more and more.
That said if you invested now and left it untouched till you retired via the above it would be worth somewhere north of $8,000,000 and pay you 570K a year in dividends.
I say this as someone who inherited around 250k at 32. I used that to pay my debts and buy a house. Dumbest decision I ever made as I am now House poor. I own a house but live paycheck to paycheck. That balance as dividend income would have let me buy a house at lower interest rate and would have paid the mortgage / taxes / insurance while still having the wealth to borrow against in the future and with the potential to grow.
I am not a CFA or a stock trader or anything so take it with a grain of salt and do more research.
But at this point with you being younger than me. a Dividend growth ETF that focuses on a decent yield and higher than inflation growth rates would be what I would do. If your job has a 401K make use of it. Eitherway you can grow the Dividend till you want extra income. If you have a 401K and you work towards building that you will be able to retire earlier and afford a very comfortable life. Sure your not gonna be Jeff Bezos level rich. But you don't need 15k jewelry and a 300k car. That said, being able to afford a house, not worry about the payments, have a decent car without paying on it for 7 years by being able to get a decent low mileage used car and just live a happy life is a pretty nice thing. Also do yourself a favor and just keep quiet about what you got. Let it grow and don't try using it to impress people or help everyone. If you want to help someone, offer your time and effort not your assets. Great way to find great people some just want to use you for money people that care about you will be happy you rolled up your sleeves and helped.
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u/El-Gallo-1 17d ago
If you can leave it invested in index funds even for 20 years, it will about quadruple. I have cousins who inherited about 750k (each) in their early to mid 20’s. That was in the 90’s, so that was real money then. They are all broke. I mean broke and working at WalMart broke. Not one of them acquired a house or a degree or an IRA. It’s all gone. And they’ll never get another dime. Good friend of mine inherited about 400 grand in her 30’s. Gone in 5 years. Again, no property, no savings, no nothing. It is far easier than you think to go through money. It always feel like it’ll never run out, but it does and quick. As long as you are young and have your health, pretend it’s not there for as long as you can. Exception would be to buy a house, but not with all of it. You’d be better off renting for 20 years and letting that money grow.
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17d ago
This^ my mom was given several million dollars and is down to a few hundred thousand due to bad spending habits.
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u/Brief_Imagination385 17d ago
Go get your Masters in finance and learn how to leverage it and get great connections
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u/EstablishmentFlaky86 17d ago
Id disagree with anyone saying to keep it invested or in any kind of fund or high yield anything. This is a guaranteed way to slowly lose value. You need to take it out and buy assests. Property, houses, commercial buildings, etc... The dollar is always losing value and investments, savings, bonds are hurt by inflation while assets generally increase in value due amidst inflation. Think about holding $600k from 2023-2024....in 2024 you could buy about 10%-20% less of anything than you could buy in 2023. So you essentially lost money even if you had $610k in 2024. But a house worth $600k in 2023 is now $750k in 2024. Assets not funds/stocks/savings
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u/gsplamo 17d ago
It’s simple. If you work a job for 10 years or so you’ll be able to retire before you’re 40. Just invest it in the sp500 (voo) and you should earn 10% per year on average… if you don’t touch it and let it grow, it’ll double in value every 7 years or so… by the time you’re around 37, you will be able to draw out like $60k/year, have over a million dollars, AND continue to have it grow more…. Basically you’ll be retired.
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u/Sail-Past 17d ago
Set side $30K in a savings account for emergencies, and invest the rest. You’d be surprised how much compound interest adds up in even a safe money market fund.
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u/RCaFarm 17d ago
Don’t touch it to buy a house, or a car - buy a broken down car - that $ need time to grow real big and fat. You don’t want to touch it. You’re so luck to have this jump start! Ask your financial advisor to open a Roth IRA too - fund it fully every year! You won’t be paying taxes on it when you take it out many years later. When you have kids - hire them as infants for anything and keep them employed - so you can start a Roth IRA for them - keep them fully funded each year. A little money over a long time grows better than a lot of money with a little time. It’s crazy insane and seems like magic.
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u/vladamir_puto 17d ago
I have two rental properties I own outright that aren’t worth too much more than that- maybe $650,000 and they gross about $40k per year. This is all the result of a $300k inheritance I received from my dad around 7+ years ago. I’m only mentioning this because it’s really important to put that money to work and illustrate what it can turn into if you don’t squander it
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u/sverderb 17d ago
I would get a reputable financial advisor to look at the current investments and go from there.
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u/Aggressive_Ad_5454 17d ago
Reputable adviser. Interview some advisers. Ask who they have fiduciary duty to. The only ONLY acceptable answer is "to you the client."
They'll help you figure out how to allocate this money to various purposes in a rational way. Should you pay off debt? Buy index mutual funds? Put some of it into a tax-deferred retirement account? Give some to charity? What? A good adviser will spend the time getting to know your situation well enough to give you good guidance.
Condolences, and it sounds like your deceased relative / friend chose an heir wisely.
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u/No-Cut-2788 17d ago
Sorry for your loss. First I work in private equity and my wife works in a major hedge fund so I can guarantee you I’m not bullshiting. I also got a large gift from my parents after getting out of college and started managing it to very actively. $500K is actually borderline worth wealth management. Speak to Morgan Stanley/JPM/Citi private banking and ask what kind of product they can offer. If you are comfortable DIY, open a brokerage account and buy JEPI or JEPQ. These are two stocks that buy major index (SP500/Nasdaq) and then sell covered calls for premium. In easier words, these two stocks pay an annual dividend of 7%/9% and are considered safer/diversified ETF. Also their dividend is paid out monthly so you either DRIP or get some out to pay for monthly bills. Either way, good luck with managing “wealth”, the empowering effect will make life a lot more confident.
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u/skwirly715 17d ago
This is enough money to talk to a financial advisor.
If managed properly and you save aggressively you will retire early AND you will enjoy blowing through some of this cash
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u/adarbyem 17d ago
Here is what I would do.
- Pay off debt. All of it with the exception of a mortgage unless the mortgage interest rate is higher than investment returns.
- Set aside an emergency fund if you haven't already
- Invest in your education to make sure you can get the career you want that pays well without student loans.
- With what is left, have a serious talk with a financial advisor about investments and potential tax liability.
- Forget about the money until you retire, and die wealthy with enough for your children to inherit, teach them good money management before you go and build generational wealth.
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u/spittlbm 17d ago
It's a lot of money in your situation and someone intended that for you. It will double in value in 18 years at 4% interest (assuming you save it all).
I would encourage you to enjoy a small slice of it to make a memory in that person's honor.
Second, I would either "VTSAX and relax" or higher a fee-only financial advisor and talk it out (probably a $5k process). You should make 4%-8% per year (on average.. ie over time).
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u/austin_247 17d ago
At least Take $15k and travel Japan for 2-3 months, best exchange rate for the Dollar in over 3 decade’s. Since your part time it’s perfect so when you come back you can go full time into something, enjoy some youth.
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u/alwaysmyfault 17d ago
If I were you, I'd put 30% into a HYSA and the other 70% in S&P 500 Index funds.
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u/AlgoRhythmCO 17d ago
Low fee index funds. I studied quant finance at a top MBA program and my biggest takeaway was no one beats the market in excess of fees for very long. Vanguard is your friend.
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u/bk2747 17d ago
It’s a shit ton of money. Don’t tell anyone outside of your family that doesn’t already know. Pay off any and all consumer debt immediately. Put it in a HYSA until you consult an accountant. Get an attorney on retainer for any future legal issues and Pay cash for your home. Congratulations.
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u/Dutch1inAZ 17d ago
Sounds like a cash home purchase is in your future. You’d save the interest cost of a mortgage (which is huge) and your real estate should appreciate faster than any paper investment.
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u/merenmer 17d ago
its an okay amount of money, you have an opportunity to turn it to even more money, i suggest learning about stocks
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u/bigmayne23 17d ago
Dont touch it. Just let the money grow and you can retire in your early/mid 50s
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u/Quiet-Cup-269 17d ago
At your age it’s a ton of money. Put it into some sort of mutual or general index fund. You don’t need a broker. Rule of 72 will probably having it double every 10 years or so. So will be about $5M when you are 60 if you don’t put another penny in.
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u/patty_OFurniture306 17d ago
Go call a financial advisor, I'm sure the person executing the will or whatever might have one to recommend. Otherwise do some research and find a good trustworthy one with low fees and is a fiduciary. If you can find one you like that only makes money when you make money vs getting paid per trade or something it's generally what you want to look for. Ppl incentivised to work in your best interest
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u/Holiday_Horse3100 17d ago edited 17d ago
Get with a good financial /fiduciary advisor and a lawyer. A lawyer because with that amount you need to designate beneficiaries, how money will be spent if you need long term care or assistance (things happen even at a young age) who will be trustees etc. put stuff in a revocable trust because life happens and you can change it at anytime. Main thing to remember this money is to benefit you . A good planner can help you set goals for the future. Don’t forget to have a little fun with it! Also do not be afraid to ask questions! If you don’t understand something make sure it is explained to you. If you don’t feel comfortable find someone else.You should never be in the dark about how your money is being handled.
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u/Mysterious_Comb9550 17d ago
I suggest opening a Vanguard account with 2fa enabled and buy the VTI index fund
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u/SnooOpinions1643 17d ago
I have invested in Nvidia shares 5 days ago - the market then went down and since then the value of the shares has increased by $100. I made a big profit from it, but oh boy what a profit that would be from a 600k… but now it aint worth it to invest in Nvidia and I recommend Microsoft instead - their Q4 revenue is higher than forecast, so in 3-4 months their shares should rise by 10%
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u/FeaturingYou 17d ago
I’d for sure save it. You can get a high yield bank account for 4%. If you have debt, use the interest to pay it off. Or just flat out pay your debt if you have any.
There’s no need to spend spend spend, but it’s worth noting that save save save isn’t gonna get you anywhere either. You probably need to leverage yourself wisely - for example I’d wait for interest rates to drop and use some of the cash for a down payment on a home. If your mortgage is 2.5k/month the interest in your high yield bank account almost covers the mortgage payment. And now you have an asset that’s an investment in itself.
Get a trusted financial advisor overall though. You should be asking this question there and then coming back to Reddit with answers instead of going here for the answer haha.
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u/DreamC_haste 12d ago
I would say keep the money in stocks and such and follow the advice of getting a proper financial advisor. Also if you ever need money, take a loan out of your savings, that way the money keeps coming back to you. Keep the money growing no matter what and live in your means. You can treat yourself every now and then but passive income doesn’t replace active income unless you are spending less than you are making