Yikes! EX-hubby died and left me and four children money

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windfall
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Joined: Tue Jun 19, 2018 6:20 pm

Yikes! EX-hubby died and left me and four children money

Post by windfall » Tue Jun 19, 2018 6:44 pm

WE all set up Vanguard Accounts now what? It's not a huge amount but would like to maximize it for myself and adult kiddos. I'm 46 with 72,000 in an IRA with Vanguard not invested yet. He left me an life insurance of 140,000 (I paid off the house I bought at the bottom of CA housing market in 2012) There are four kids ages 19, 22, 24, and 28 they each got 55,000 In an inherited IRA with just opened Vanguard accounts. They will also be getting/splitting 300,000 distributed over five years.
My concern is that this bull market is close to ending its run and do we want to jump all into index funds now? Yikes, again. I love the Vanguard philosophy of low-cost index funds any advice would be much appreciated!

TravelGeek
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Joined: Sat Oct 25, 2014 3:23 pm

Re: Yikes! EX-hubby died and left me and four children money

Post by TravelGeek » Tue Jun 19, 2018 7:07 pm

Welcome to Bogleheads.org.

There is a wiki page aptly named after your username that might provide some useful information.

https://www.bogleheads.org/wiki/Managing_a_windfall

How you and your kids invest the inheritances might to some degree depend on the intended future purpose of the funds. E.g., if you were planning to use them in the next 1-5 years for XYZ (eg, home purchase or college?), I would take less risk than if it was meant to be a portion of the overall retirement portfolio, to be used many years down the road.
Last edited by TravelGeek on Tue Jun 19, 2018 7:10 pm, edited 1 time in total.

BusterMcTaco
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Joined: Tue Jul 11, 2017 6:36 pm

Re: Yikes! EX-hubby died and left me and four children money

Post by BusterMcTaco » Tue Jun 19, 2018 7:10 pm

If you're going to market time, you may as well go play roulette in Vegas. You're about as likely to get it right. If you want to invest, then invest in the index funds at a comfortable asset allocation and don't think about it any more!

And if we're about to hit a bear market, nowhere is safe... unless you want to put it all in a high interest checking account, which is totally fine too, if that suits your investment goals... but it won't do too much towards helping your portfolio for retirement.

EnjoyIt
Posts: 1584
Joined: Sun Dec 29, 2013 8:06 pm

Re: Yikes! EX-hubby died and left me and four children money

Post by EnjoyIt » Tue Jun 19, 2018 7:14 pm

BEST advice I can give you is to take your time. There is no rush. Even if the money just sits in a money market fund for a year collecting 1-1.5% interest that is way better than rushing and making a mistake. Read the Wiki above, take your time ask questions and then make a decision.

Also, your comment "bull market is close to ending its run" stinks of market timing. There is no one on this planet who can consistently and accurately predict what the market will or will not do. People have been saying the market is at its peek for a few years now but seams like they have been wrong as well. You may be right or you may be wrong and that is a fact.

Grt2bOutdoors
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Location: New York

Re: Yikes! EX-hubby died and left me and four children money

Post by Grt2bOutdoors » Tue Jun 19, 2018 7:57 pm

windfall wrote:
Tue Jun 19, 2018 6:44 pm
WE all set up Vanguard Accounts now what? It's not a huge amount but would like to maximize it for myself and adult kiddos. I'm 46 with 72,000 in an IRA with Vanguard not invested yet. He left me an life insurance of 140,000 (I paid off the house I bought at the bottom of CA housing market in 2012) There are four kids ages 19, 22, 24, and 28 they each got 55,000 In an inherited IRA with just opened Vanguard accounts. They will also be getting/splitting 300,000 distributed over five years.
My concern is that this bull market is close to ending its run and do we want to jump all into index funds now? Yikes, again. I love the Vanguard philosophy of low-cost index funds any advice would be much appreciated!
The young adults, yes your children are now adults should each have the IRA titled appropriately in a manner that permits them to receive Required Minimum Distributions over their lifetime. An ideal fund would be a Target Retirement fund that becomes more conservative as they approach retirement age or a diversified fund like Lifestrategy Growth Fund that will provide capital appreciation over time.

How is the rest of your portfolio or assets structured? It’s best to look at your total portfolio first, your desired risk tolerance and anticipated needs before making suggestions on how to invest it.
"One should invest based on their need, ability and willingness to take risk - Larry Swedroe" Asking Portfolio Questions

Compound
Posts: 609
Joined: Mon May 26, 2014 1:32 pm

Re: Yikes! EX-hubby died and left me and four children money

Post by Compound » Tue Jun 19, 2018 8:21 pm

windfall wrote:
Tue Jun 19, 2018 6:44 pm
WE all set up Vanguard Accounts now what? It's not a huge amount but would like to maximize it for myself and adult kiddos. I'm 46 with 72,000 in an IRA with Vanguard not invested yet. He left me an life insurance of 140,000 (I paid off the house I bought at the bottom of CA housing market in 2012) There are four kids ages 19, 22, 24, and 28 they each got 55,000 In an inherited IRA with just opened Vanguard accounts. They will also be getting/splitting 300,000 distributed over five years.
My concern is that this bull market is close to ending its run and do we want to jump all into index funds now? Yikes, again. I love the Vanguard philosophy of low-cost index funds any advice would be much appreciated!
Sorry for your loss.

To clarify, which money are you asking about allocating? Are you looking for advice on which index funds to place your IRA in? It sounds like the life insurance windfall went to pay off the home — do I have this correct? Are the kids making their own decisions about the inherited IRAs, or do they want your guidance?

I will echo what others have said — take your time making these decisions, there is no rush.

Note that you seem to be asking if you should avoid stock heavy index funds with your question. Given the ages of those involved, almost certainly not. Even with an extended stock downturn, you all have an expected ton of time (many decades) for the market to recover. In this case, simply decide on an asset allocation for your portfolio (i.e. mixture of stocks and bonds that meets your risk tolerance and goals) and then invest in index funds.

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