What to do with "Extra" money:

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Nowizard
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Joined: Tue Oct 23, 2007 5:33 pm

What to do with "Extra" money:

Post by Nowizard » Thu Jul 12, 2018 8:21 am

We have been accumulating cash for a proposed move from a LCOL area to a HCOL area that would involve selling our present home and purchasing a significantly more expensive, but smaller, home in the HCOL area. Circumstances resulted in a change of plans, though we will leave our current home on the market and down size in our current area. Equity from our current home will provide funds for the next purchase. As a result, we will have additional money accumulated for the proposed move that has been in MM for a year or so.

The question is what to do with it. We have other cash reserves and income to meet our retirement needs. Obvious choices are to increase donations or place it into our current allocation plan at appropriate percentages. Are there other suggestions? We are essentially investing for unlikely financial problems or for our heirs since both of us are in our 70's. We donate to our children periodically though they are doing well.

Tim

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Pajamas
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Re: What to do with "Extra" money:

Post by Pajamas » Thu Jul 12, 2018 8:25 am

If you and your children clearly don't need it, then donating it would be appropriate. Sounds like enough to make a positive difference in the world.

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luminous
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Re: What to do with "Extra" money:

Post by luminous » Thu Jul 12, 2018 8:30 am

Nowizard wrote:
Thu Jul 12, 2018 8:21 am
Obvious choices are to increase donations or place it into our current allocation plan at appropriate percentages. Are there other suggestions?
Those are great choices. You could also increase the down payment on the new home to have a smaller mortgage, unless you expect to be able to buy the smaller home free and clear already. You could buy a home that needs a bit of work and have the cash on hand to do renovations. Finally you could keep it in the MM and treat it as early portfolio withdrawals for living expenses, but that doesn’t work if your RMDs already cover living expenses.
50/20/30 US stock/international stock/bonds. Hope to semi-retire in 2026.

ignition
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Joined: Sun Dec 11, 2016 11:28 am

Re: What to do with "Extra" money:

Post by ignition » Thu Jul 12, 2018 8:33 am

You could set up your own charitable foundation: http://jlcollinsnh.com/2012/02/08/how-t ... llionaire/

mortfree
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Re: What to do with "Extra" money:

Post by mortfree » Thu Jul 12, 2018 6:24 pm

Grandkids?

529

or

taxable account. Might I suggest Berkshire Hathaway A shares.

Otherwise donate to your alma mater, local library, or religious affiliation or animal shelter.

dknightd
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Re: What to do with "Extra" money:

Post by dknightd » Thu Jul 12, 2018 6:31 pm

I'd probably leave it where it is. In case you change your mind, or something unexpected comes along.

WhiteMaxima
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Re: What to do with "Extra" money:

Post by WhiteMaxima » Thu Jul 12, 2018 6:35 pm

Spend it on yourself 1st. for extra: 529 for grand kids, charitable foundation name after you, etc.

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ruralavalon
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Location: Illinois

Re: What to do with "Extra" money:

Post by ruralavalon » Thu Jul 12, 2018 7:51 pm

mortfree wrote:
Thu Jul 12, 2018 6:24 pm
Grandkids?

529

or

taxable account. Might I suggest Berkshire Hathaway A shares.

Otherwise donate to your alma mater, local library, or religious affiliation or animal shelter.
+ 1, but rather than any individual stock I suggest a very tax-efficient stock index fund in a taxable account, and I would add spend something on yourselves like a nice car, luxury vacation, or something unnecessary that you would enjoy.
"Everything should be as simple as it is, but not simpler." - Albert Einstein | Wiki article link:Getting Started

mortfree
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Re: What to do with "Extra" money:

Post by mortfree » Thu Jul 12, 2018 7:59 pm

ruralavalon wrote:
Thu Jul 12, 2018 7:51 pm
mortfree wrote:
Thu Jul 12, 2018 6:24 pm
Grandkids?

529

or

taxable account. Might I suggest Berkshire Hathaway A shares.

Otherwise donate to your alma mater, local library, or religious affiliation or animal shelter.
+ 1, but rather than any individual stock I suggest a very tax-efficient stock index fund in a taxable account, and I would add spend something on yourselves like a nice car, luxury vacation, or something unnecessary that you would enjoy.
:sharebeer

I only suggested BRKA because it is at $288,000 per share. OP seems to need something to absorb all of the extra cash and I thought that might help.

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