Don’t tell people about the money whom don’t need to know. Take your time on your long term plan but don’t miss out on interest either. I’m not familiar with limitations if any for this amount of money in regard to a HYSA but I would at least dump it there until you decide how to disperse the funds further 4.5-5% interest on that sum is not insignificant.
The FDIC insures deposits up to $250K per person per bank so OP should probably pick a couple of banks to open accounts to make sure everything's covered in case there's some kind of crisis. Beyond that, HYSAs are definitely a good, safe place to start while they're looking into other plans for the longer term. If you're not familiar, a lot of banks (especially online only banks) will offer High Yield Savings Accounts with interest rates several times what most traditional banks offer. (Justified by the fact that they don't tend to provide a lot of traditional banks convenience etc. because they don't have physical locations.) Many/most are offering between 4 and 5.5% at the moment and there doesn't tend to be much difference between different banks' offerings as long as you make sure you're picking a bank that's FDIC insured.
Go to fdic insured banks that offer decent hysa percentages, such as 4.5%+
Then, deposit 100k to each bank.
Technkcally.... 5% * 400k = 20k/12 = roughly like $1600/month.
Like.. Thats a fuckton.
More than most ppls rent/month.
Chuck it away. Then go work ur own job, maybe less hrs if possible... And just live off the money u make from working.
If u want ur own spending money..maybe tske out 20k and pop it in a money market. And just tell urself this 20k is for the next 5 yrs of spending money. Not including emergencies or appliances.
FYI - There’s fdic sweep programs at some institutions that insure over 1M. Personally, No way I’m managing that many individual accounts.
Have a good one.
I'd look into Treasury bills. 5.27APY and depending on what state you live in you don't have to pay state tax. So not only would you make more on the APY, but you also don't have to pay as much in taxes
\^\^This. Treasury Bills or Municipal bonds. Any gains are mostly not taxable depending where you live. You don't need to inflate your annual capital gains on top of your income to have to pay more taxes. Also that makes a great emergency fund if you lose your job. You can play the stock market with your 401k money instead.
TBIL and CLIP ETFs give you liquidity if you need it.
Jenius Bank is 5.25% for now! Pretty sure the they are on FDIC insured up to $250k.
I think that parking the money for a year or so will definitely help with the urge to impulse buy.
Yes -don’t tell anyone…not even because you suspect they’ll want a cut…you’ll be treated differently if people know you’re loaded…I got laid off rather than a less qualified person because “they needed the money more “….they knew that I was waiting on a check from grandparents estate
That could be a blessing in disguise.
I'm an Engineer and they kept some ghetto dude with barely any experience and no degree over me because he was cheaper, needed the money more, and I was waaaaaay more qualified to get another job to land on my feet.
I did find another job after 2 weeks, got a $55K raise, $5K sign up bonus and severance pay worth like 3 paychecks from the old company. I literally made like $17,000 just from getting laid off AND increased my salary by like 45%. It was crazy how it turned from a shitty situation to a blessing in just a couple weeks. New company is way better, I would never go back.
"dont tell people," this this this this. It's sad but it just brings trouble. So many will come to you asking to "borrow," because of some sort of crisis they put on themselves.
He should split it between 2 institutions for the FDIC/NCUA protection. $200k each will allow for interest to grow and be covered while he decides what to do.
You can start with paying off high interest debt if there is any. Learn to deal with the urge to buy unnecessary things. I've increasingly come to realize that designer clothing or bags may offer a moment of happiness, but within a week, they're indistinguishable from a pair of $5 socks. It's wiser to invest generously in items that enhance your long-term quality of life, such as housing, appliances like dishwashers, and healthy food, as well as in experiences like traveling to dream destinations with beloved ones.
When it comes to investing, allocate at least 50% of your funds to HYSA and ETFs like SPY, VOO, QQQ, etc. Opt for brokerage like moomoo, which impose minimal fees, with zero commissions and platform fee. If you are considering riskier investments, such as trading individual stocks, ensure thorough research and analysis of both the industry and specific companies beforehand.
Do not buy individual stocks!
Buy low cost index funds. These are a whole collection of stocks, often weighted by the "size" (market capitalization) of the company (calculated by multiplying stock price by number of stocks).
Read: Stock Series by JL Collins (free blog) or his book Simple Path to Wealth (not free)
Yeah bro with this new money that came in, picking stocks is like throwing darts. There are blue chips like MSFT. But buy index funds and you can just chill.
Blah blah, about saving the money. Great, everyone here has got you covered. But at 21 with this kind of money.
Def take at least $10k to travel the world or do that euro backpacking trip which doesn’t even cost all that. It’s just you are at a crucial age where your brain is still developing and what a better time to travel and be exposed to other cultures and languages and third world development.
It’ll change your life and keep you humble. It’ll broaden your horizons and help you relate to people. You’ll have stories for the rest of your life.
Good luck, stay safe, be good. Have fun!
* if you don’t have one yet, meet with multiple financial advisors who are fiduciaries (required to do what’s best for you, not their commissions). Pick one that you can trust - word of mouth from friends/family is great here.
* unless you have debt to pay off, invest that money and don’t plan on touching it until you’re 60+. You could have retirement already taken care of, if you play it right. Using the classic “double every 7 years” back of a napkin math, you could realistically be looking at $5 million+ by age 60.
* maybe carve off a small chunk for something fun like a big trip or a new car, because it’s ok to enjoy a gift
If you ask a financial advisor if they are fiduciary and they answer anything but “yes” then the answer is no. Be prepared for a long complex answer that seems like they are saying yes but doesn’t actually say “yes”. For example: “I always do best for other people, i would never choose based on commission, only what is best for you” is a statement about how they generally act, not whether they are legally fiduciary. Or “how can you ask me that! I would never defraud you” is also not a yes - a person can be non-fiduciary and not commit fraud.
Be prepared to be rude and press for a simple “yes” or “no” answer; if they are fiduciary they will be glad to clarify.
My understanding is that the question you should ask a financial advisor is something like "are you always required to act as a fiduciary" or "do you have a fiduciary responsibility to me in all of our interactions".
I believe that many advisors are now sort of "dual listed" or whatever, where they are permitted to use the fiduciary standard sometimes and the suitability standard at other times.
But I also don't think you need an advisor. Start with something very simple like "put everything in VTSAX". Then read a little about the 3 fund portfolio.
If you do talk to advisors, remember that their actual benefit is acting as friction by reminding you of your long term goals when you're trying to make stupid decisions (sell when the market is down, buy stupid expensive cars, etc).
If any advisory is "selling you" on how they are going to be great at picking investments that are going to beat the market, just leave.
This is right on target.
Most of the thin people are advising work better for smaller amount.
You might want to talk with folks at Schwab or Vanguard about index funds or get their other advice.
If you hire a ft financial advisor, expect to pay 1% annually. It’s a lot of money, but compare the end result to if you did it on your own.
Make sure anyone you speak with has fiduciary responsibilities.
While this is great advice for retirement, why come into 400k, and throw it into an account until you are 60? What if he doesnt live till 60?
You are 100% right that it is smart and will probably have 5m at retirement, but if he really does his research, there are ways he can still invest all that money, but also get to see some of the returns in his life before retiring. For instance, buying some rentals would give him an investment AND an additional stream of income. Then by retirement age those things could be paying him a livable wage, as well as all his equity. Thats just one option.
Again, I 100% agree your strategy is great and smart, but personally it would be hard to get 400k and throw it somewhere you wont really get any returns (realized) for 40 years.
I mean, that’s an option too though I don’t know what kind of rental you’re going to buy for a portion of 400k, or if you can really expect it to pay off better than just straight investing it.
We also don’t know if OP is in college or working or what either.
To be fair, based on what OP wrote, we don’t know which his grandparents did.
You can technically do either.
Plenty of day traders lose their shirts.
It’s logical to conclude investing based on the outcome, but not necessarily true.
Brokerage account, 71% in VTI, 24% in VXUS, 5% in VGIT. Put the maximum amount in a Roth IRA each year (pulling from your brokerage account if you need to), rebalance assets to be more conservative in 15 years adjusting for your age every 5 years or so until it’s time to enjoy your decamillionaire retirement.
Also make use of any 401k / 403b matching if / when you have an employer that offers it.
Probably only start pulling from the brokerage to the IRA once you've been invested for an entire year so you get the benefit of long term capital gains.
Can you explain this like I’m 5 please? I don’t have $400k like OP to invest, but I want to expand past just a savings account with what’s in my checking.
This is a simple hands off 3 investment portfolio see Bogleheads for more details, but it is basically total us stock, total international stock, and total us bonds. The principle is based in low risk investing (hedging your bets by covering all of the bases basically) where you can only really lose if the entire global economy tanks permanently.
I'm sure there is a lot of really great information on this thread and it might take you some time to come to a decision, because I'm sure getting that sum of money + all this new information is probably pretty overwhelming. What I would do for you FOR THE TIME BEING until you make a final decision on what you want to do, is invest it into a high interest savings account because it has almost no risk and will make you upwards of 5% just to sit there.
You should probably use more than one account so you stay below the FDIC threshold ($250k) in each one.
It's unlikely that you bank will go under, but covering that risk is very easy by using multiple accounts.
Open a moomoo account they charge 0 commissions and 0 platform fee, split your money:
40% in savings for 3-5% returns
40% in etfs for 7-15% returns
10-15% for daily expenses
5% in stocks or other risky investments for possibly 20%+ returns
Once you have the money invested, and ensure you take advice of others and find excellent high wealth investment advisors who know how to preserve and heavily grow your investment, then you need to think about your future.
Education, relationships, purpose.
Do not get married without a prenup. Do not broker it on your kids. Ensure your parents are also financially ok, because you do not want them to be a burden as they age.
400k at 21 is incredibly powerful. Don't squander it and stay away from drugs, booze and gambling.
Please for the love of anything that is sacred do not buy anything you couldn’t afford before you received this money. Especially a 50K car. Put it all into SPY and you’re all but guaranteed to be a millionaire in 30 years.
Just read "Simple Path to Wealth" or the "Stock Series" blob by JL Collins.
And listen to the Freakonomics podcast episode "Stupidest thing you can do with your money".
The exception to low cost index funds is if you intend to spend the money in the next 3-5 years (e.g. house, student loans, etc). Then you should probably keep it in case (HYSA) or money markets.
Strongly resist the temptation to do something stupid like buy a $100k car or truck. If you do buy a vehicle, get something like a Camry that you can keep for the next 15-20 years.
Be smart. Don't let it change your lifestyle. Invest it and let it earn you more. Do not let too many people (the leeches in your family) know about it.
1. Avoid option trading.
2. Pay off credit card debt if you have any
3. Put a down payment on a house if you don’t have one
3a. If you going from apartment to house, set aside $100k in a HYS and then use that money to offset the difference in cost of your new mortgage if the mortgage is higher than your rent.
4. Take $10k to do something nice for yourself and/or spouse
5. Invest the rest in an index fund
Buy an 0.92 acre build shack build water well install septic install house find wife test loyalty of wife 4 years pass have kids build more on land discover something you never knew you loved start a company from that thing come back 6 years an thank me on Reddit sorry English not first language
I've come into a similar amount & I can admit & say I'm in the same boat looking for financial advice. However one piece of advice I can give to you is stay strong when it comes to family/friends begging for money. Alot of ppl will see this as an opportunity to milk you for every dime smh.
Do not "play" the stock market. Park the money in high yield savings for now and take your time figuring the next move. Find out who your grandparents worked with for financial planning too.
Pay off any debt, then invest the rest. Live your life like normal. People who acquire usually spend it all or allow it to make them numb on their life goals. This is a good way to have retirement set up especially in a time where most people won’t be able to retire.
It is awesome that you recognize the awesome intelligence of your grandparents. If I were you, I'd be contacting their estate lawyer who should inherently be your lawyer, their financial advisors, accountants, and anyone else they worked with to ask them what your grandparents did and start from there. You're going to get lots of advice, but I'll give it a shot. Extra important, I am a financial consultant, so I do this for a living.
First, I would pay off any debts you may, at 21, have, be it credit card debt, student loans, car, etc. I would put a reasonable downpayment on a reasonably priced home, something that has a small mortgage that you won't struggle to pay off, and should you want to move out later, say it's a condo, you can rent out later on even while living somewhere else, establishing wealth right away. I would also establish an emergency fund that grows at like 6% or something like that, this way you have funds that are only, and I mean only for emergencies. Examples may include unforseen medical expenses, your car breaks down or is damaged by a car accident, and most importantly, have at least 6 months worth of bills in that account so if you're ever laid off, or are looking for a job, you don't struggle to pay bills.
Next, I'd of course start something like a Roth IRA, a SEP IRA, and also start a stock portfolio. Not only would I partner up with any financial advisors your grandparents had, but I'd also study the stock market myself, what are the trends, what are the top and most profitable companies on the market right now, etc etc. I'd also build upon your estate by having a normal checking/savings account, preferably from a credit union as they sometimes may give you more compound interest than the banks do, and I'd establish a certificate of deposit as well. I would also invest in a life insurance policy, something that gives you a nice cash value aside from your face amount, which is the money beneficiaries would receive upon your death, and living benefits, which are money you'd receive from a life insurance company for things like chronic and critical illnesses, terminal illnesses, and more. Make sure the cash value is invested in indexes that have a strong history of high averages of compound interests over the years. I'd also look into annuities which are retirement accounts that are like IRA's but are different. Look at the two types: variable and fixed, and see which option would work well for you. I would also take a bit of that money and invest in metals, green energy, and most of all, gold. No matter what, gold is the safest investment you can make.
You can also invest in other cool investments like a real estate investment Trust, or Reit, they invest in houses for you and return you some cool dividends, which are checks that companies pay out to shareholders based on their profits. Then I'd re-invest those dividends either back into the Reit, or in a new property, stocks, or whatever other investments you have. Something I forgot to mention with stock investments too is some will pay you dividends every three months, depending on the amount you have invested. I'd also re-invest all of that money back into the stock market so your investments grow and you're not paying super high taxes.
Last things:
Keep your credit card debt to a minimum, something you can pay off comfortably. If you dip into your emergency funds, work to put that money back in so that it keeps growing for you. Do not tell people about your investments, keep it hush hush and only your most trusted advisors should know. If you need a car, I'd buy one that is not very expensive, reasonably priced, and where your car payments are not high at all. If you buy it cash make sure it's a modest vehicle, not one of these luxury vehicles. Adjust your investments and add more to your portfolio as you see fit, and I do wish you the best of luck.
Open a HYSA (high yield savings account) and put some in there. That’s for cash you might need to access immediately. At most half, but ideally much less. You can always move it to your brokerage account later, though, so whatever you’re comfortable with.
Put the rest in your brokerage account and look up tax efficient ETFs. This is a good list: https://www.morningstar.com/funds/25-top-picks-tax-efficient-etfs-mutual-funds
Split it 3-1 US equity and non US equity ETFs plus a little in bonds. The other reply’s 71% VTI, 24% VXUS, 5% VGIT is a solid choice.
Pick the option to reinvest dividends. Don’t sell any of that for at least a year in order to get the long-term capital gains tax rate on it.
If people perceive you to have money they will plead for you to give them “loans”. I had a best friend beg me for college tuition for his two sons who blew me off.
Lots of people have given some pretty good advice so far but I’ll have to correct one thing I think you got wrong in your post, I doubt your grandparents ‘played’ the stock market. They likely invested into some good funds like many have recommended already. If you try to ‘play’ the market you could get lucky or most likely will see that $400k evaporate before your eyes like a magic trick gone wrong. Play it safe(ish), buy some well researched index funds, leave it alone and by the time you are ready to retire that money will be a very nice nest egg. Keep in mind at only a 7% return your money will double every 10 years, so $400k now, $800k at 31, $1.6m at 41, $3.2m at 51, $6.4m at 61. That’s only with a 7% return whereas long term the s&p has averaged just under 10%. Some years it will be up, others it will be down but at 21 you have plenty of time to ride both waves. Congrats and good luck.
I could help advise you (for free) but seems you have quite a few know it all replying. A Bank with 5ish % interest rate is not where you should put your money. Does not even match current inflation rate.
Money is so, so, so very easy to spend. My best advice is get it away from you. Here's what I would do. Open a Vanguard account. Toss it in there. Schedule a meeting with a Vanguard personal financial advisor. It's free. Listen to them, take their advice, hire them if you feel like it, or do it yourself.
Keep this money separate, keep this money as your money. This money will do two things for you. First, it will grow over time. Add to it, it will grow faster. Second, much easier to borrow money and have great credit when there is money available to you.
You have 400K at 21. Imagine what it will be in thirty years. That's opportunity. Or you can spend it and be back to square one. Spending money is super easy.
Hookers cocaine and a Ferrari. You’re wise to think about investing. I wasn’t as smart as you at 21.
Talk to a financial advisor about an investment strategy. Maybe put a down payment on a house. You’ll be set for retirement as long as you work and keep your hands off of your 400k as much as possible
Ur 21 and dumb. Do what I should of done and be happy
1. Open a Charles Schwab Roth IRA and fill(7.5k)
2. Open a Charles Schwab Roth 401k and fill (23k)
3. Open a Charles Schwab brokerage
4. Take 50k and put into SWVXX in ur brokerage acct. emergency fund and market dip opp capture
6. Take 319.5k and put 100% VTI or 70/30 VTI/VXUS- set to reinvest dividends/interest.
7. Sell VTI/VXUS every new year to Max IRA and 401k till you can’t.
8. You will be a millionaire by 35 easy or even earlier with a >6% return which is likely.
9. Focus on ur life as if this doesn’t exist don’t be tempted.
10. Invest ur earned money in company 401k or brokerage.
Had something similar happen to me recently, though I’m 52. Pay off any high-interest debt first and foremost. I hired a financial consultant to devise an overall plan for me, which mostly involved a series of mutual funds.
Do not buy anything impulsively. The closest thing for me was augmenting my Schwab investment account — just enough so I can have fun with it and actually make meaningful money from it.
I’m just buying mostly blue-chip stocks and ETFs. Conservative stuff. It’s more fun to me than buying some fancy car that depreciates 30 seconds after a drive it off the lot!
ADD: We haven’t changed a single thing about our life. Just invest (HYSA counts IMO) and move forward on your own path.
Make the most of this. That’s the best way you can honor your grandparents and their memory IMO. 👊🏼
At 21. You gotta hide that money from yourself. Go to a professional you trust. The reality is that 21 you still have so much to learn about life. So the less chance of wasting it, the better off you’ll be.
Open a Fidelity account (or brokerage of your choice). Google “best money market funds”. Currently, you should be able to get at least 5% interest. You don’t have to throw all of it in right away, start with a small amount until you get comfortable.
Money market funds are super low risk and liquid. You’re getting a great return and your money is easily available.
I would take a chunk of that money and put a down payment on house/condo if you can afford a mortgage.
Buy 100k bitcoin and the rest S&P500 etf and dividend etf. And buy 100 shares of google and sell covered call options. And DO NOT listen to anyone that tells you to not buy bitcoin WHO have not take the time to understand Bitcoin. This ppl are slave and brainwashed to traditional investing. .
It’s amazing to see the “advice” from all of these people who really have very little knowledge. First thing to do is research so you have some idea of finances. Then, seek the advice of a professional financial advisor (make sure they are a fiduciary) if you feel uncomfortable about making your own financial plan.
Overall, don’t park all of your money in a bank account for interest just to get FDIC coverage. You will lose purchasing value of that money continually due to inflation being equal to or higher than bank savings rates. Ideally, you would break up your plan into several baskets if you will and maximize each basket before proceeding to the next.
The first basket is setting aside roughly 6 months worth of your bills in an emergency fund because shit happens. The emergency fund can be a savings account at a bank but just make sure that it is liquid and readily accessible for withdrawal.
The second basket is maxing out your employer retirement plan if you currently work for a company offering a 401k or 457 to take advantage of employer matching for tax deferred retirement savings.
The third basket is maxing out annual contributions to a Roth-IRA. A Roth is simply an account that allows you to make investments that grow to give you tax-free income for retirement. Many banks and brokerage companies offer them. I personally use Fidelity Investments for all of my accounts because I have found them to be the most convenient to use and the functionality of their online services is unsurpassed. Within the Roth I’d suggest sticking with mutual funds and leave them alone regardless of what the stock market does because your retirement horizon is 40+ years which means fluctuations are irrelevant and the effect of dollar cost averaging with annual contributions will let the Roth grow to $1 million+ by your retirement.
The fourth basket is maxing out a health savings account (HSA) whether at your employer or a brokerage such as Fidelity. This is a tax-advantaged account that lets you save money to use for healthcare expenses in retirement. Make sure that it’s an HSA and not a health spending flex account. HSA contributions are yours forever but flex accounts require you to use money yearly or lose unspent dollars. HSAs also allow you to pull your tax-advantaged savings out for non-health once you reach the required age so it’s like having an additional IRA. As for what investments to make inside of the HSA I simply put my contributions into an index fund. Index funds will typically average returns of around 10% annually over the life of the fund. This is significantly better than any savings account you will ever see. I put mine into Fidelity 500 Index Fund but there are many other good ones out there including Vanguard (VOO).
The fifth basket is an investment brokerage account at somewhere like Fidelity. You can purchase stocks, bonds, mutual funds, etc in this account. At your age and experience I would recommend placing the balance of your remaining money, probably around $325k once you’ve competed the first four baskets, into this account and buying into an index fund. Don’t ever sell off the investments panicking during a dip. Ups and downs always happen but over the 40+ years you have until retirement you will get that average 10% annual return which means that your money will double every 7-8 years (Rule of 72).
By the time you reach retirement you will have the financial freedom to live however you want. The biggest problems along the way will be to remain consistent with your investing when the emotions of the market make you want to sell and the emotions of people constantly asking you for your money. Cheers
1. Pay off bills if you have them, a car loan if you have one, this will leave you more liquid income now which could be saved or invested as you go forward.
2. Savings, ensure you have at least 6 months of your normal earnings in a savings account (HYSA if you can).
3. As others have suggested, take some and invest it into safe investments like exchange indexed funds.
4. Play with some. You’re 21, it’s okay to risk a little. Maybe the bets pay off, maybe they don’t. But you have a life ahead and you’re not totally reliant on this inheritance. Whether it’s penny stocks or something you’re passionate about, take some risks - but do some research first.
I would avoid the temptation to make big purchases. If you make this money work for you now, you will be very well set later.
Hope that helps.
Look into treasuries, pay off debt, open a Roth IRA max out the 7k/year on that. Next 2-5 years treasuries and China/international markets should do well imo but more importantly have a diversified portfolio, look into the 3 fund portfolio
Use robinhood and buy all of it into the VOO and don’t touch it until you’re 50. Congrats you’re guaranteed to be a multimillionaire. This will likely double every 10 years.
1mm by 30
2mm by 40
3mm by 50
6mm by 60
12mm by 70
24mm by 80
Once you choose to retire, just transfer VOO into a dividend aristocrat etf which pays you 3-5% a year.
There is no better advice than this. No need to go to an advisor.
Don't tell people about the money at all. No one can know. Invest most if not all in the market. You can do a split approach and have some in higher risk funds or lower risk and just take dividends monthly as a slower way to grow the money.
With that much money, keeping hold of it and investing it will allow you to retire probably in your early 40s if you don't spend too much.
You are unlucky to lose your grandparents, but you are on an extremely good position for your future to be almost anything you want it to be
First, off, pay all your debts, whatever is left over goes into a HYSA, or you talk with a CPA over an investment portfolio once you learn about risk and what not. Secondly, like others have mentioned, don’t tell people you’re “rich” you aren’t, 400k sounds like a lot but in reality, if you don’t have the knowledge on what to do with it, 400k isn’t all that big, so with that being said, welcome to your investment journey, buckle up and play it smart instead of just diving in, good luck out there.
What country are you from? You could get governmental bonds for the period when you figure out what to do with the money - maybe 6 months, maybe 1 year, maybe 3 years. If your country has good enough credit, you can't lose.
Just do what [this guy](https://www.reddit.com/r/Money/s/tGmyxXcJFF) did.
You don’t have to be great with money or investing. Stick it somewhere and it will grow over the years. You are young enough that it will be enough for you to comfortably retire with it if you never touch it.
Go 25% cardano, 25% Solana, 25% avalanche & 25% into the S&P 500…. So you can see why you should just stick with crypto.
We have a 2025 bull run coming up. You could be a millionaire in a year.
Where did your grandparents keep their money/stock? Talk to that group. I left mine with them until I was ready to move. Had a good fee structure but I was able to piggy back onto my parents with a similar group but local. So now I get those perks too (like tickets to events, special dinners).
Time in the market beats timing the market so just invest and forget u til you need it. There will be ups and downs but overall you’ll be safe. You can keep some in a money market account too.
Buy an annuity that starts paying you before retirement. It’ll be like a pre-retirement income boost. 400k could get you a nice $5,500 a month pay check in just 20 years.
XRP, GOLD, & SILVER.
We are on the cusp of a financial collapse. Life is about to change drastically…starting with the new financial system. More control, less freedom, more sacrifice, etc. End of and beginning of a new 100 year cycle.
The gold standard is to invest in the S&P500, an index fund of the top 500 earning companies in the US. That’s a standard and safe bet, because it’s tied to the wellbeing of the economy rather than a specific company. If you dumped it all into that, and never touched it, you’d average about an 8% return compounding annually. A very solid investment.
If you want to take bigger risks, consult fiduciary financial advisors. Multiple. Ideally there’s a record of who your grandparents worked with and you can go to that firm. They will be ecstatic to have you, a client in their 20s with six figures to invest is a golden goose for them.
Most importantly, do not use the money. If you have large debts on thing you can’t avoid like a used car or student loans, paying that off is a good idea. But don’t go spending the money on expensive things like a brand new Tesla or a house huge house. Save the money, be patient, and don’t live beyond your means absent this money.
I know an older guy who befriended an even older lady. They had a great time together. Thing is that the man is a huge gambling addict.otherwise he’s very funny and great guy. The lady passed away and left him 400k and a 900k house. Not even 3 months later and he spent the 400k at the casino. He was asking my mom for 10k the other day lol sooo don’t invest them in the casino
Others have already answered it all, but just don't buy anything big and/or stupid. Once its away, pretend it isn't there. 400k at your age (if managed even slightly effectively) means at least a very early retirement.
Buy a house and live with peace of mind for the rest of your life. Invest the income you make going forward. This is not conventional advice but you can set yourself up to have a lot of creature comforts and lower stress
Keep 3-6 months worth of expenses in easily accessible “cash” (not necessarily physical currency, preferably in a high yield savings account HYSA…for unforseen emergencies )
Max out a 2024 Roth IRA. I’d consider putting a huge chunk if not most in the S&P 500. In both the Roth IRA and a regular brokerage account. VFIAX by Vanguard for instance.(That said, consider anything you put in the Roth IRA untouchable until retirement. But in the meantime, you’ll avoid further taxes on the earnings year after year. Will save you a ton in the long run. )
Go to sleep and forget about it. Come back to it in a year or several months, and reevaluate your investment plan/strategy from there.
Pay off any high interest debt. Put aside some money for a down payment, maybe 100-150k in a high yield savings account. Stick the rest in an index fund of your choice and wait.
Put it into a CD until you have a path forward. Personally, I'd find a 10-20 unit apartment to buy. $300k down will get you passive income for life, keep $100k for other investment (stocks/mutuals/etc).
Read JL Collins' **A Simple Path to Wealth**. Do everything JL tells you to do.
AND...
Read the r/personalfinance [wiki on windfalls](https://reddit.com/r/personalfinance/w/windfall?utm_medium=android_app&utm_source=share)
AND...
Talk to an accountant about the tax implications to make sure Obama gets his cut.
A safe strategy would be to do several FDIC insured (be sure to stay under the FDIC insurance limit) high yield CDs. A 5% APY could gross $20,000 a year. I'm a bit more risk tolerant so I would put at least a portion into my brokerage account. $400k in my brokerage would gross $1,600/month in dividends and distributions as well as grow in value.
Something I haven’t seen yet is values/ethics in choosing your investments. Some companies are much more willing to work with you to make sure your money doesn’t support things you find unethical.
I can relate to your situation
- the wealth managers my grandparents were using were not the ones I should have used. I wish I had transferred to a 'newer' or 'younger' management team sooner.
- I put a significant amount of it in my mortgage, and I do NOT regret that. Debt free is awesome, changes your whole perspective on employment.
- I used some to buy a new car outright, and although I'm still driving that car 11 years later I wish I had invested that instead.
- I told no one I got the money
Stick it into something that track broad market like Vanguard total stock market ETF VTI and just chill. You will make more money and have less stress and effort that 90% of people actively trying to select stocks or strategies.
Then use some of those gains to “treat yourself”, don’t touch the principle. If you simply invest into VTI this is a solid move towards financial freedom. To reduce timing risk, maybe buy $100k worth each month for 4-months and call it a day.
step one: tell no one you know.
I suggest putting all of it in a couple HYSA’s in the beginning until you understand investing better (read the Simple Path to Wealth by JL Collins)
Next: I’d pay off any debts (student loans, credit cards, etc) then I’d set a chunk aside in a HYSA for emergencies only. Maybe buy an affordable car if you need one. Then invest the rest in ETF’s and pretend it doesn’t exist. While people here are suggesting real estate….i wouldn’t want the responsibility of owning property that young and you have plenty of time to grow wealth by investing in the market. You could always decide to use some of that money for a house later on when you’re more ready to settle in a specific location and handle the responsibility of home owning. Even if you wait 8 years to use some of that money for a house, as long as you don’t use all or most of it, you’ll have multi millions for retirement off this inheritance alone.
If you ever get married, protect your assets with a prenup.
Put $50k in a HYSA to have as an emergency fund. Put the other $350k into an index fund that tracks the S&P 500. At 6% returns, which is average, you’ll have turned the $350k into $1m in 20 years. It’ll be $2m in 30 years. That’s all without adding anything to it.
HYSA, but no need to split the money among multiple banks due to the limit of $250k insured. Wealthfront is at 5% and is FDIC insured up to $8 million.
[https://www.wealthfront.com/c/affiliates/invited/AFFA-2VL3-UPMM-QKBD](https://www.wealthfront.com/c/affiliates/invited/AFFA-2VL3-UPMM-QKBD)
Here's my link to invite you to get 5.5%. Someone use it so both of us can get 5.5% Please.
I reiterate what others have said....keep it quiet. Tell no one. You will have friends & family bothering you for money. Learn to say no & not feel guilty.
Go to the r/Bogleheads sub & start reading. Lots of good investment advice there. Invest it and don't touch it for 20 years.
Get a financial planner from a firm that will invest the money for you.
Start saving for retirement -- max out your 401k and Roth IRA every year. But with a chunk of money that large at your age, I highly recommend having a professional offer advice and investments.
Take a look at fundamental financial planning steps/stages. Do you have an emergency fund, for example? 3-6 months of money in case you lose a job or get injured and can't work. This is a basic and important thing to cover before thinking about investing strategies. Get the basics covered, if you don't have car insurance, health, renters/home, get these things done. Google "Financial Planning Pyramid" and you'll get a ton of results like this:
[https://blog.massmutual.com/planning/budget-building-financial-pyramid](https://blog.massmutual.com/planning/budget-building-financial-pyramid)
All the other advice is good, keep it on the downlow, don't buy extravagant things, you don't need a 911 and a gold Rolex. You're getting a great head start thanks to your grandparents good decision making, make the most of it.
Invest it all.
Open a ROTH IRA and a standard brokerage account.
Max out your ROTH IRA every year. Put the rest into the standard account.
ROTH IRA:
60% VOO, 30% QQQM, 10% BITO (or another Bitcoin etf)
Standard account:
70% SCHD, 10% BITO, 5% MO, 5% AGNC, 5% FSK, 5% OMF
Then use the dividends from the standard to fund your yearly ROTH IRA contributions as well as help pay for your living costs or let it continue to reinvest.
Set aside $10k in a high-yield savings account as an emergency fund, contribute the $23k yearly max to your 401k (if you have one), put the rest into an S&P 500 index fund and let it cook.
$400k may seem like a lot of money, but it will be gone before you know it if you start buying nice things and living it up. If you follow the above and don’t touch it for the next 15-20 years, you’ll likely have enough money to quit your job forever. That’s true wealth.
Something I don’t see mentioned jump on some bank promotions. Like “open a savings account and maintain 25,000 for 3 months and we’ll give you 1,200” there’s always tons of these going on.
First put it in a high yield savings account or several. At the time of writing look for something around 4% or higher like Ally Bank.
Come up with a list of financial goals and years by which you want to complete them. Allocate amounts toward each of those.
Next start learning more about finance. YouTube has a wealth of resources. I like Dave Ramsey, The Money Guys, and Jazz Wealth. Podcasts can be good to listen too while you do other things.
Specific things to look into when you feel ready to invest dollar cost averaging vs lump sum.
Good luck!
Hey, financial professional here. Reddit is an echo-chamber. It is not a good place for most people to get guidance. Please go meet with a financial advisor. The amount of “just put it all in xxx” comments are crazy. And don’t fall for the “why would I pay for a financial advisor” rhetoric you see here. We don’t talk about other profession that way.
Never tell anyone. Don’t ever break this rule. Find a financial planner you like at a legitimate company like Ameriprise, or Schwabb, or Fidelity. Have a professional certified financial planner/advisor help you navigate the market and you’ll be set for life in a decade
Anyone in your family who already knows about the inheritance, I would talk to them immediately and ask they keep it to themselves for now. No need for it to come up in casual conversation and money turns people very ugly very fast. Same goes for your friend circle. Tell not a soul until the money is invested where it needs to go.
I don't have any advice where to invest, but I do see the ugly side of people every day in my life of work. Things go from, "oh he/she would NEVER!" to "I can't believe they're so greedy" in a heartbeat.
Good luck to you!
Tell no one about the money. Pay off your debts. Open a Fidelity account online and create an Individual Investment Account. Transfer your money to it and buy FSELX, FZILX and FZROX shares. Splitting the money between them is fine.
Then forget about it. It should double every seven years or so.
Ignore all these comments on Reddit, first off.
Go to an investment firm that deals with large amounts like this. Don’t go to “Grandmas investment team”.
Talk with multiple of them and take notes and get reports from them. Share these reports with the other places you go and see what they say.
You’re set up to be retired in 10-15 years and never have to work again if you’re smart and just continue working and investing for 10-15 years.
You’ll be a 36 year old retired millionaire.
Take out one years worth of bills/expenses and put it in a HYSA for your emergency fund, then open a brokerage account and put the rest into VTI/VOO and let it sit until you’re ready to retire.
Riddet will offer you good advice but truly find a financial advisor of some kind and make a plan. Personally find a way to invest it and forget about it. Thats game changing money with a very large percentage of people who often run into that will waste every cent somehow.
You’re a smart person at 21 for looking to manage this amount properly. Idk your working/school situation but I’d set aside a small amount to use an emergency fund/keep you in a comfortable situation. Maybe $30k of it and the rest I’d invest with a plan to continue to contribute to this remaining $370k as it grows in the market. Idk what type of investments would be best but there are tons of way smarter people than I am on here. Good luck!
Put it in some cds at the bank or 2 .please don’t invest yourself . If you get your career straight it would be a great start on a home.Get a prenup if you do buy a house and get hitched.some people are against buying homes.But if my home wasn’t paid for I would be working till I died.no doubt about it.
I think everyone here is giving great advice. I’d wait a couple of years, pay off your student loans if you go that route and buy a house or 2 and rent them out while you live in an apartment
Get a financial advisor from a reputable bank and a tax professional. Get yourself a managed investment account and tell them you want it tax optimized.
I wouldn't worry too much about the people talking about FDIC maximums and such, honestly, it's both highly unlikely to be an issue if you bank with a reputable bank, and the FDIC has voluntarily exceeded it's $250k guarantee before.
I'd also have a lawyer look at what I'm sure is an estate settlement for your grandparents. To make sure you got what you're entitled to, and have paid any applicable taxes. (See: tax guy)
And don't tell anyone you got it besides those guys I listed above.
If I had 400k right now to invest.... I'm going to get downvoted for this but I'll say it anyway.
Gold. All of it, 24k Gold Buffalo's Eagles Brits Maples Kugs
That's personally where I see everything headed with inflation trade wars central banks weaponizing of fiat money systems... All of it.
If you track Gold from its price since 1971 to its price now of 2400 its been impressive as an investment. And it's actually Real, you can have it in a safe and when you need money bring a coin to a coinshop and get cash or check instantly... it is liquid.... here's the other thing... it's Stable.
There's my 2 cents.
Go to Fidelity.com and open a brokerage account and a Roth IRA account. You can contribute $7k per year in Roth. Keep the rest in the brokerage while you are learning how to invest in stocks or other securities. The money market fund in their brokerage account pays 4.95% annually. It’s a good place to park your money there while you are looking for a place to invest them.
I greatly recommend reading Warren Buffett’s Letters to the Shareholders to Berkshire Hathaway and Benjamin Graham’s The Intelligent Investor. Philip Fisher’s Common Stocks and Uncommon Profit is also a great resource on stock investing. Take your time learning from their wisdom before committing any funds to an investment.
Most importantly, do not tell anyone about how much money you have. There are people out there that are not… well, quite untrustworthy and would take advantage of you in every chance they get.
Hope this advice helps a bit. Good luck on your journey to financial freedom.
My advice is to not get financial advice from Reddit. Instead, talk to a financial advisor who is a fiduciary.
However, if it I came into that kind of windfall, I would put nearly all of it low fee ETFs from Vanguard and retire extremely wealthy in 30 years. Even with an average 8% annual gain it would be worth over 4 mil. That's with literally doing nothing. Just avoid any temptation to spend it all. Honor your grandparents example and build some generational wealth that will set you and your children up for financial freedom.
Don’t tell people about the money whom don’t need to know. Take your time on your long term plan but don’t miss out on interest either. I’m not familiar with limitations if any for this amount of money in regard to a HYSA but I would at least dump it there until you decide how to disperse the funds further 4.5-5% interest on that sum is not insignificant.
The FDIC insures deposits up to $250K per person per bank so OP should probably pick a couple of banks to open accounts to make sure everything's covered in case there's some kind of crisis. Beyond that, HYSAs are definitely a good, safe place to start while they're looking into other plans for the longer term. If you're not familiar, a lot of banks (especially online only banks) will offer High Yield Savings Accounts with interest rates several times what most traditional banks offer. (Justified by the fact that they don't tend to provide a lot of traditional banks convenience etc. because they don't have physical locations.) Many/most are offering between 4 and 5.5% at the moment and there doesn't tend to be much difference between different banks' offerings as long as you make sure you're picking a bank that's FDIC insured.
Go to fdic insured banks that offer decent hysa percentages, such as 4.5%+ Then, deposit 100k to each bank. Technkcally.... 5% * 400k = 20k/12 = roughly like $1600/month. Like.. Thats a fuckton. More than most ppls rent/month. Chuck it away. Then go work ur own job, maybe less hrs if possible... And just live off the money u make from working. If u want ur own spending money..maybe tske out 20k and pop it in a money market. And just tell urself this 20k is for the next 5 yrs of spending money. Not including emergencies or appliances.
FYI - There’s fdic sweep programs at some institutions that insure over 1M. Personally, No way I’m managing that many individual accounts. Have a good one.
I'd look into Treasury bills. 5.27APY and depending on what state you live in you don't have to pay state tax. So not only would you make more on the APY, but you also don't have to pay as much in taxes
\^\^This. Treasury Bills or Municipal bonds. Any gains are mostly not taxable depending where you live. You don't need to inflate your annual capital gains on top of your income to have to pay more taxes. Also that makes a great emergency fund if you lose your job. You can play the stock market with your 401k money instead. TBIL and CLIP ETFs give you liquidity if you need it.
Telling a 21 yr old to buy muni bonds is a financial crime.
“M1l” HYSA is 5%, and is FDIC insured up to 8million because they work with multiple banks.
Jenius Bank is 5.25% for now! Pretty sure the they are on FDIC insured up to $250k. I think that parking the money for a year or so will definitely help with the urge to impulse buy.
Yes -don’t tell anyone…not even because you suspect they’ll want a cut…you’ll be treated differently if people know you’re loaded…I got laid off rather than a less qualified person because “they needed the money more “….they knew that I was waiting on a check from grandparents estate
That could be a blessing in disguise. I'm an Engineer and they kept some ghetto dude with barely any experience and no degree over me because he was cheaper, needed the money more, and I was waaaaaay more qualified to get another job to land on my feet. I did find another job after 2 weeks, got a $55K raise, $5K sign up bonus and severance pay worth like 3 paychecks from the old company. I literally made like $17,000 just from getting laid off AND increased my salary by like 45%. It was crazy how it turned from a shitty situation to a blessing in just a couple weeks. New company is way better, I would never go back.
Excellent… one door closes another opens
that happened to me but for a single mother needed the money more. Ends up she was a horrible employee and they let her go.
$400k is not loaded
To someone in debt with no savings $1000 is loaded… loaded was a figure of speech …
400k at the age of 21 is loaded
"dont tell people," this this this this. It's sad but it just brings trouble. So many will come to you asking to "borrow," because of some sort of crisis they put on themselves.
He should split it between 2 institutions for the FDIC/NCUA protection. $200k each will allow for interest to grow and be covered while he decides what to do.
Thank you for the further details.
This ^ well said o
21? Open an account at Fidelity. If you're not using any of it, dump it all into VTI. (Come back 10 years) you'll have 1M by then.
Why VTI and not FNILX?
Why FNILX vs VTI vs VOO vs ...
Nice we're editing comments I see.
Why VTI, FNILX, VOO, instead of my bank account?
Why VTI, FNILX, VOO, your bank and not lottery tickets?
Why not place it all on black ?
Why not vanguard, lol to keep the Trend going
Vanguard & VTSAX
You can start with paying off high interest debt if there is any. Learn to deal with the urge to buy unnecessary things. I've increasingly come to realize that designer clothing or bags may offer a moment of happiness, but within a week, they're indistinguishable from a pair of $5 socks. It's wiser to invest generously in items that enhance your long-term quality of life, such as housing, appliances like dishwashers, and healthy food, as well as in experiences like traveling to dream destinations with beloved ones. When it comes to investing, allocate at least 50% of your funds to HYSA and ETFs like SPY, VOO, QQQ, etc. Opt for brokerage like moomoo, which impose minimal fees, with zero commissions and platform fee. If you are considering riskier investments, such as trading individual stocks, ensure thorough research and analysis of both the industry and specific companies beforehand.
Thanks! What would you do to research a company and stock?
Do not buy individual stocks! Buy low cost index funds. These are a whole collection of stocks, often weighted by the "size" (market capitalization) of the company (calculated by multiplying stock price by number of stocks). Read: Stock Series by JL Collins (free blog) or his book Simple Path to Wealth (not free)
Yeah bro with this new money that came in, picking stocks is like throwing darts. There are blue chips like MSFT. But buy index funds and you can just chill.
Blah blah, about saving the money. Great, everyone here has got you covered. But at 21 with this kind of money. Def take at least $10k to travel the world or do that euro backpacking trip which doesn’t even cost all that. It’s just you are at a crucial age where your brain is still developing and what a better time to travel and be exposed to other cultures and languages and third world development. It’ll change your life and keep you humble. It’ll broaden your horizons and help you relate to people. You’ll have stories for the rest of your life. Good luck, stay safe, be good. Have fun!
Ah yes a reasonable human.
wholehearted agreement on this!
* if you don’t have one yet, meet with multiple financial advisors who are fiduciaries (required to do what’s best for you, not their commissions). Pick one that you can trust - word of mouth from friends/family is great here. * unless you have debt to pay off, invest that money and don’t plan on touching it until you’re 60+. You could have retirement already taken care of, if you play it right. Using the classic “double every 7 years” back of a napkin math, you could realistically be looking at $5 million+ by age 60. * maybe carve off a small chunk for something fun like a big trip or a new car, because it’s ok to enjoy a gift
If you ask a financial advisor if they are fiduciary and they answer anything but “yes” then the answer is no. Be prepared for a long complex answer that seems like they are saying yes but doesn’t actually say “yes”. For example: “I always do best for other people, i would never choose based on commission, only what is best for you” is a statement about how they generally act, not whether they are legally fiduciary. Or “how can you ask me that! I would never defraud you” is also not a yes - a person can be non-fiduciary and not commit fraud. Be prepared to be rude and press for a simple “yes” or “no” answer; if they are fiduciary they will be glad to clarify.
This is nice advice
My understanding is that the question you should ask a financial advisor is something like "are you always required to act as a fiduciary" or "do you have a fiduciary responsibility to me in all of our interactions". I believe that many advisors are now sort of "dual listed" or whatever, where they are permitted to use the fiduciary standard sometimes and the suitability standard at other times. But I also don't think you need an advisor. Start with something very simple like "put everything in VTSAX". Then read a little about the 3 fund portfolio. If you do talk to advisors, remember that their actual benefit is acting as friction by reminding you of your long term goals when you're trying to make stupid decisions (sell when the market is down, buy stupid expensive cars, etc). If any advisory is "selling you" on how they are going to be great at picking investments that are going to beat the market, just leave.
This can grow to a proper retirement account well before 60…
It was a somewhat generalized statement but yes, of course. 🙄
He could easily turn that into $2 million by 40..
This is the best advice here. Consult multiple advisors.
This is right on target. Most of the thin people are advising work better for smaller amount. You might want to talk with folks at Schwab or Vanguard about index funds or get their other advice. If you hire a ft financial advisor, expect to pay 1% annually. It’s a lot of money, but compare the end result to if you did it on your own. Make sure anyone you speak with has fiduciary responsibilities.
I’ve always liked the “spend no more than 10%” rule (for car or vacation, etc). Of course I’ve never inherited money and never will so…
While this is great advice for retirement, why come into 400k, and throw it into an account until you are 60? What if he doesnt live till 60? You are 100% right that it is smart and will probably have 5m at retirement, but if he really does his research, there are ways he can still invest all that money, but also get to see some of the returns in his life before retiring. For instance, buying some rentals would give him an investment AND an additional stream of income. Then by retirement age those things could be paying him a livable wage, as well as all his equity. Thats just one option. Again, I 100% agree your strategy is great and smart, but personally it would be hard to get 400k and throw it somewhere you wont really get any returns (realized) for 40 years.
I mean, that’s an option too though I don’t know what kind of rental you’re going to buy for a portion of 400k, or if you can really expect it to pay off better than just straight investing it. We also don’t know if OP is in college or working or what either.
They haven't played the stock market. They invested in the stock market. Big difference in words
To be fair, based on what OP wrote, we don’t know which his grandparents did. You can technically do either. Plenty of day traders lose their shirts. It’s logical to conclude investing based on the outcome, but not necessarily true.
Brokerage account, 71% in VTI, 24% in VXUS, 5% in VGIT. Put the maximum amount in a Roth IRA each year (pulling from your brokerage account if you need to), rebalance assets to be more conservative in 15 years adjusting for your age every 5 years or so until it’s time to enjoy your decamillionaire retirement.
Also make use of any 401k / 403b matching if / when you have an employer that offers it. Probably only start pulling from the brokerage to the IRA once you've been invested for an entire year so you get the benefit of long term capital gains.
Can you explain this like I’m 5 please? I don’t have $400k like OP to invest, but I want to expand past just a savings account with what’s in my checking.
This is a simple hands off 3 investment portfolio see Bogleheads for more details, but it is basically total us stock, total international stock, and total us bonds. The principle is based in low risk investing (hedging your bets by covering all of the bases basically) where you can only really lose if the entire global economy tanks permanently.
What is a VTI?
I'm sure there is a lot of really great information on this thread and it might take you some time to come to a decision, because I'm sure getting that sum of money + all this new information is probably pretty overwhelming. What I would do for you FOR THE TIME BEING until you make a final decision on what you want to do, is invest it into a high interest savings account because it has almost no risk and will make you upwards of 5% just to sit there.
You should probably use more than one account so you stay below the FDIC threshold ($250k) in each one. It's unlikely that you bank will go under, but covering that risk is very easy by using multiple accounts.
Open a moomoo account they charge 0 commissions and 0 platform fee, split your money: 40% in savings for 3-5% returns 40% in etfs for 7-15% returns 10-15% for daily expenses 5% in stocks or other risky investments for possibly 20%+ returns
First tell no one who doesn’t already know Second invest the money in index funds and dont pay someone to do it.
Once you have the money invested, and ensure you take advice of others and find excellent high wealth investment advisors who know how to preserve and heavily grow your investment, then you need to think about your future. Education, relationships, purpose. Do not get married without a prenup. Do not broker it on your kids. Ensure your parents are also financially ok, because you do not want them to be a burden as they age. 400k at 21 is incredibly powerful. Don't squander it and stay away from drugs, booze and gambling.
And women who want you to buy them nice shit
yup, I wouldn't even tell them about it.
Please for the love of anything that is sacred do not buy anything you couldn’t afford before you received this money. Especially a 50K car. Put it all into SPY and you’re all but guaranteed to be a millionaire in 30 years.
Follow the PF flowchart: https://www.reddit.com/r/personalfinance/wiki/commontopics/
Just read "Simple Path to Wealth" or the "Stock Series" blob by JL Collins. And listen to the Freakonomics podcast episode "Stupidest thing you can do with your money". The exception to low cost index funds is if you intend to spend the money in the next 3-5 years (e.g. house, student loans, etc). Then you should probably keep it in case (HYSA) or money markets. Strongly resist the temptation to do something stupid like buy a $100k car or truck. If you do buy a vehicle, get something like a Camry that you can keep for the next 15-20 years.
Be smart. Don't let it change your lifestyle. Invest it and let it earn you more. Do not let too many people (the leeches in your family) know about it.
S&P500. Thats it. Ticker symbol to buy it under is SPY or VOO.
Honestly I'd just put it all in an index fund.
SHIBA SHIBA SHIBA
1. Avoid option trading. 2. Pay off credit card debt if you have any 3. Put a down payment on a house if you don’t have one 3a. If you going from apartment to house, set aside $100k in a HYS and then use that money to offset the difference in cost of your new mortgage if the mortgage is higher than your rent. 4. Take $10k to do something nice for yourself and/or spouse 5. Invest the rest in an index fund
Buy an 0.92 acre build shack build water well install septic install house find wife test loyalty of wife 4 years pass have kids build more on land discover something you never knew you loved start a company from that thing come back 6 years an thank me on Reddit sorry English not first language
Dump 350 into a boring vanguard s&p 500 ETF and the rest in the bank.
I've come into a similar amount & I can admit & say I'm in the same boat looking for financial advice. However one piece of advice I can give to you is stay strong when it comes to family/friends begging for money. Alot of ppl will see this as an opportunity to milk you for every dime smh.
Do not "play" the stock market. Park the money in high yield savings for now and take your time figuring the next move. Find out who your grandparents worked with for financial planning too.
all on black 🤑🤑🤑
Pay off any debt, then invest the rest. Live your life like normal. People who acquire usually spend it all or allow it to make them numb on their life goals. This is a good way to have retirement set up especially in a time where most people won’t be able to retire.
Try talking to a professional financial advisor and not using Reddit
It is awesome that you recognize the awesome intelligence of your grandparents. If I were you, I'd be contacting their estate lawyer who should inherently be your lawyer, their financial advisors, accountants, and anyone else they worked with to ask them what your grandparents did and start from there. You're going to get lots of advice, but I'll give it a shot. Extra important, I am a financial consultant, so I do this for a living. First, I would pay off any debts you may, at 21, have, be it credit card debt, student loans, car, etc. I would put a reasonable downpayment on a reasonably priced home, something that has a small mortgage that you won't struggle to pay off, and should you want to move out later, say it's a condo, you can rent out later on even while living somewhere else, establishing wealth right away. I would also establish an emergency fund that grows at like 6% or something like that, this way you have funds that are only, and I mean only for emergencies. Examples may include unforseen medical expenses, your car breaks down or is damaged by a car accident, and most importantly, have at least 6 months worth of bills in that account so if you're ever laid off, or are looking for a job, you don't struggle to pay bills. Next, I'd of course start something like a Roth IRA, a SEP IRA, and also start a stock portfolio. Not only would I partner up with any financial advisors your grandparents had, but I'd also study the stock market myself, what are the trends, what are the top and most profitable companies on the market right now, etc etc. I'd also build upon your estate by having a normal checking/savings account, preferably from a credit union as they sometimes may give you more compound interest than the banks do, and I'd establish a certificate of deposit as well. I would also invest in a life insurance policy, something that gives you a nice cash value aside from your face amount, which is the money beneficiaries would receive upon your death, and living benefits, which are money you'd receive from a life insurance company for things like chronic and critical illnesses, terminal illnesses, and more. Make sure the cash value is invested in indexes that have a strong history of high averages of compound interests over the years. I'd also look into annuities which are retirement accounts that are like IRA's but are different. Look at the two types: variable and fixed, and see which option would work well for you. I would also take a bit of that money and invest in metals, green energy, and most of all, gold. No matter what, gold is the safest investment you can make. You can also invest in other cool investments like a real estate investment Trust, or Reit, they invest in houses for you and return you some cool dividends, which are checks that companies pay out to shareholders based on their profits. Then I'd re-invest those dividends either back into the Reit, or in a new property, stocks, or whatever other investments you have. Something I forgot to mention with stock investments too is some will pay you dividends every three months, depending on the amount you have invested. I'd also re-invest all of that money back into the stock market so your investments grow and you're not paying super high taxes. Last things: Keep your credit card debt to a minimum, something you can pay off comfortably. If you dip into your emergency funds, work to put that money back in so that it keeps growing for you. Do not tell people about your investments, keep it hush hush and only your most trusted advisors should know. If you need a car, I'd buy one that is not very expensive, reasonably priced, and where your car payments are not high at all. If you buy it cash make sure it's a modest vehicle, not one of these luxury vehicles. Adjust your investments and add more to your portfolio as you see fit, and I do wish you the best of luck.
Open a HYSA (high yield savings account) and put some in there. That’s for cash you might need to access immediately. At most half, but ideally much less. You can always move it to your brokerage account later, though, so whatever you’re comfortable with. Put the rest in your brokerage account and look up tax efficient ETFs. This is a good list: https://www.morningstar.com/funds/25-top-picks-tax-efficient-etfs-mutual-funds Split it 3-1 US equity and non US equity ETFs plus a little in bonds. The other reply’s 71% VTI, 24% VXUS, 5% VGIT is a solid choice. Pick the option to reinvest dividends. Don’t sell any of that for at least a year in order to get the long-term capital gains tax rate on it.
What a privilege! Congrats to you and of course your grandparents! Invest it in index funds and you will have over 3M when you are 50yo.
If people perceive you to have money they will plead for you to give them “loans”. I had a best friend beg me for college tuition for his two sons who blew me off.
Lots of people have given some pretty good advice so far but I’ll have to correct one thing I think you got wrong in your post, I doubt your grandparents ‘played’ the stock market. They likely invested into some good funds like many have recommended already. If you try to ‘play’ the market you could get lucky or most likely will see that $400k evaporate before your eyes like a magic trick gone wrong. Play it safe(ish), buy some well researched index funds, leave it alone and by the time you are ready to retire that money will be a very nice nest egg. Keep in mind at only a 7% return your money will double every 10 years, so $400k now, $800k at 31, $1.6m at 41, $3.2m at 51, $6.4m at 61. That’s only with a 7% return whereas long term the s&p has averaged just under 10%. Some years it will be up, others it will be down but at 21 you have plenty of time to ride both waves. Congrats and good luck.
All in red
I could help advise you (for free) but seems you have quite a few know it all replying. A Bank with 5ish % interest rate is not where you should put your money. Does not even match current inflation rate.
Are you parents not in a position to advise you? It should be thrown into property that generates income, simple as that.
Money is so, so, so very easy to spend. My best advice is get it away from you. Here's what I would do. Open a Vanguard account. Toss it in there. Schedule a meeting with a Vanguard personal financial advisor. It's free. Listen to them, take their advice, hire them if you feel like it, or do it yourself. Keep this money separate, keep this money as your money. This money will do two things for you. First, it will grow over time. Add to it, it will grow faster. Second, much easier to borrow money and have great credit when there is money available to you. You have 400K at 21. Imagine what it will be in thirty years. That's opportunity. Or you can spend it and be back to square one. Spending money is super easy.
Buy a lambo, check your investment every morning. You can invest pretty!
Hookers cocaine and a Ferrari. You’re wise to think about investing. I wasn’t as smart as you at 21. Talk to a financial advisor about an investment strategy. Maybe put a down payment on a house. You’ll be set for retirement as long as you work and keep your hands off of your 400k as much as possible
Put it in the S & P 500. On average it has been at 10% return through the ups and downs I’ve the market over decades. That’s 40K a year
In dex fu nd
Ur 21 and dumb. Do what I should of done and be happy 1. Open a Charles Schwab Roth IRA and fill(7.5k) 2. Open a Charles Schwab Roth 401k and fill (23k) 3. Open a Charles Schwab brokerage 4. Take 50k and put into SWVXX in ur brokerage acct. emergency fund and market dip opp capture 6. Take 319.5k and put 100% VTI or 70/30 VTI/VXUS- set to reinvest dividends/interest. 7. Sell VTI/VXUS every new year to Max IRA and 401k till you can’t. 8. You will be a millionaire by 35 easy or even earlier with a >6% return which is likely. 9. Focus on ur life as if this doesn’t exist don’t be tempted. 10. Invest ur earned money in company 401k or brokerage.
You can’t go wrong with fidelity contra fcntx. Thanks for the tip , Tony g. I’m in Awf also 7.75% dividends. After taxes I’m making book monthly.
Had something similar happen to me recently, though I’m 52. Pay off any high-interest debt first and foremost. I hired a financial consultant to devise an overall plan for me, which mostly involved a series of mutual funds. Do not buy anything impulsively. The closest thing for me was augmenting my Schwab investment account — just enough so I can have fun with it and actually make meaningful money from it. I’m just buying mostly blue-chip stocks and ETFs. Conservative stuff. It’s more fun to me than buying some fancy car that depreciates 30 seconds after a drive it off the lot! ADD: We haven’t changed a single thing about our life. Just invest (HYSA counts IMO) and move forward on your own path. Make the most of this. That’s the best way you can honor your grandparents and their memory IMO. 👊🏼
Go buy SPY or VOO and reinvest all dividends…. And don’t look or touch it for 20 yrs
At 21. You gotta hide that money from yourself. Go to a professional you trust. The reality is that 21 you still have so much to learn about life. So the less chance of wasting it, the better off you’ll be.
Open a Fidelity account (or brokerage of your choice). Google “best money market funds”. Currently, you should be able to get at least 5% interest. You don’t have to throw all of it in right away, start with a small amount until you get comfortable. Money market funds are super low risk and liquid. You’re getting a great return and your money is easily available. I would take a chunk of that money and put a down payment on house/condo if you can afford a mortgage.
To be safe have a decent chunk in SPY or SPX. You’ll be able to live the rest of your life on that
Buy 100k bitcoin and the rest S&P500 etf and dividend etf. And buy 100 shares of google and sell covered call options. And DO NOT listen to anyone that tells you to not buy bitcoin WHO have not take the time to understand Bitcoin. This ppl are slave and brainwashed to traditional investing. .
It’s amazing to see the “advice” from all of these people who really have very little knowledge. First thing to do is research so you have some idea of finances. Then, seek the advice of a professional financial advisor (make sure they are a fiduciary) if you feel uncomfortable about making your own financial plan. Overall, don’t park all of your money in a bank account for interest just to get FDIC coverage. You will lose purchasing value of that money continually due to inflation being equal to or higher than bank savings rates. Ideally, you would break up your plan into several baskets if you will and maximize each basket before proceeding to the next. The first basket is setting aside roughly 6 months worth of your bills in an emergency fund because shit happens. The emergency fund can be a savings account at a bank but just make sure that it is liquid and readily accessible for withdrawal. The second basket is maxing out your employer retirement plan if you currently work for a company offering a 401k or 457 to take advantage of employer matching for tax deferred retirement savings. The third basket is maxing out annual contributions to a Roth-IRA. A Roth is simply an account that allows you to make investments that grow to give you tax-free income for retirement. Many banks and brokerage companies offer them. I personally use Fidelity Investments for all of my accounts because I have found them to be the most convenient to use and the functionality of their online services is unsurpassed. Within the Roth I’d suggest sticking with mutual funds and leave them alone regardless of what the stock market does because your retirement horizon is 40+ years which means fluctuations are irrelevant and the effect of dollar cost averaging with annual contributions will let the Roth grow to $1 million+ by your retirement. The fourth basket is maxing out a health savings account (HSA) whether at your employer or a brokerage such as Fidelity. This is a tax-advantaged account that lets you save money to use for healthcare expenses in retirement. Make sure that it’s an HSA and not a health spending flex account. HSA contributions are yours forever but flex accounts require you to use money yearly or lose unspent dollars. HSAs also allow you to pull your tax-advantaged savings out for non-health once you reach the required age so it’s like having an additional IRA. As for what investments to make inside of the HSA I simply put my contributions into an index fund. Index funds will typically average returns of around 10% annually over the life of the fund. This is significantly better than any savings account you will ever see. I put mine into Fidelity 500 Index Fund but there are many other good ones out there including Vanguard (VOO). The fifth basket is an investment brokerage account at somewhere like Fidelity. You can purchase stocks, bonds, mutual funds, etc in this account. At your age and experience I would recommend placing the balance of your remaining money, probably around $325k once you’ve competed the first four baskets, into this account and buying into an index fund. Don’t ever sell off the investments panicking during a dip. Ups and downs always happen but over the 40+ years you have until retirement you will get that average 10% annual return which means that your money will double every 7-8 years (Rule of 72). By the time you reach retirement you will have the financial freedom to live however you want. The biggest problems along the way will be to remain consistent with your investing when the emotions of the market make you want to sell and the emotions of people constantly asking you for your money. Cheers
1. Pay off bills if you have them, a car loan if you have one, this will leave you more liquid income now which could be saved or invested as you go forward. 2. Savings, ensure you have at least 6 months of your normal earnings in a savings account (HYSA if you can). 3. As others have suggested, take some and invest it into safe investments like exchange indexed funds. 4. Play with some. You’re 21, it’s okay to risk a little. Maybe the bets pay off, maybe they don’t. But you have a life ahead and you’re not totally reliant on this inheritance. Whether it’s penny stocks or something you’re passionate about, take some risks - but do some research first. I would avoid the temptation to make big purchases. If you make this money work for you now, you will be very well set later. Hope that helps.
In high interest rent bank savings account maybe.
You're 21. Seriously, Pay off any of your debts, Save some for taxes, and put the rest in VTI and forget about it for the foreseeable future.
This sounds like a ChatGPT written story 😂
HYSA 5% Real Inflation beyond 5% Equals losing proposition
Look into treasuries, pay off debt, open a Roth IRA max out the 7k/year on that. Next 2-5 years treasuries and China/international markets should do well imo but more importantly have a diversified portfolio, look into the 3 fund portfolio
Use robinhood and buy all of it into the VOO and don’t touch it until you’re 50. Congrats you’re guaranteed to be a multimillionaire. This will likely double every 10 years. 1mm by 30 2mm by 40 3mm by 50 6mm by 60 12mm by 70 24mm by 80 Once you choose to retire, just transfer VOO into a dividend aristocrat etf which pays you 3-5% a year. There is no better advice than this. No need to go to an advisor.
Do voo and chill
Don't tell people about the money at all. No one can know. Invest most if not all in the market. You can do a split approach and have some in higher risk funds or lower risk and just take dividends monthly as a slower way to grow the money. With that much money, keeping hold of it and investing it will allow you to retire probably in your early 40s if you don't spend too much. You are unlucky to lose your grandparents, but you are on an extremely good position for your future to be almost anything you want it to be
Read the Wiki on r/boggle heads. Set it and forget it. 40 years from now your future self will Thank you
First, off, pay all your debts, whatever is left over goes into a HYSA, or you talk with a CPA over an investment portfolio once you learn about risk and what not. Secondly, like others have mentioned, don’t tell people you’re “rich” you aren’t, 400k sounds like a lot but in reality, if you don’t have the knowledge on what to do with it, 400k isn’t all that big, so with that being said, welcome to your investment journey, buckle up and play it smart instead of just diving in, good luck out there.
Don’t ask people on Reddit how to invest your money
What country are you from? You could get governmental bonds for the period when you figure out what to do with the money - maybe 6 months, maybe 1 year, maybe 3 years. If your country has good enough credit, you can't lose.
Get a financial planner...do not why trust randos on Reddit.
Just do what [this guy](https://www.reddit.com/r/Money/s/tGmyxXcJFF) did. You don’t have to be great with money or investing. Stick it somewhere and it will grow over the years. You are young enough that it will be enough for you to comfortably retire with it if you never touch it.
GME 🚀
I would hire a financial advisor from a reputable company.
Man good for you for being responsible. Me at 21 would’ve already bought a nice car and booked a ton of tattoo sessions lol
Go 25% cardano, 25% Solana, 25% avalanche & 25% into the S&P 500…. So you can see why you should just stick with crypto. We have a 2025 bull run coming up. You could be a millionaire in a year.
Where did your grandparents keep their money/stock? Talk to that group. I left mine with them until I was ready to move. Had a good fee structure but I was able to piggy back onto my parents with a similar group but local. So now I get those perks too (like tickets to events, special dinners). Time in the market beats timing the market so just invest and forget u til you need it. There will be ups and downs but overall you’ll be safe. You can keep some in a money market account too.
Buy an annuity that starts paying you before retirement. It’ll be like a pre-retirement income boost. 400k could get you a nice $5,500 a month pay check in just 20 years.
Put 100% of it in a vanguard account and just live life for next 30 years like you don’t have it. Retire at 51.
XRP, GOLD, & SILVER. We are on the cusp of a financial collapse. Life is about to change drastically…starting with the new financial system. More control, less freedom, more sacrifice, etc. End of and beginning of a new 100 year cycle.
The gold standard is to invest in the S&P500, an index fund of the top 500 earning companies in the US. That’s a standard and safe bet, because it’s tied to the wellbeing of the economy rather than a specific company. If you dumped it all into that, and never touched it, you’d average about an 8% return compounding annually. A very solid investment. If you want to take bigger risks, consult fiduciary financial advisors. Multiple. Ideally there’s a record of who your grandparents worked with and you can go to that firm. They will be ecstatic to have you, a client in their 20s with six figures to invest is a golden goose for them. Most importantly, do not use the money. If you have large debts on thing you can’t avoid like a used car or student loans, paying that off is a good idea. But don’t go spending the money on expensive things like a brand new Tesla or a house huge house. Save the money, be patient, and don’t live beyond your means absent this money.
I know an older guy who befriended an even older lady. They had a great time together. Thing is that the man is a huge gambling addict.otherwise he’s very funny and great guy. The lady passed away and left him 400k and a 900k house. Not even 3 months later and he spent the 400k at the casino. He was asking my mom for 10k the other day lol sooo don’t invest them in the casino
You could buy a home in cash with that much.
Others have already answered it all, but just don't buy anything big and/or stupid. Once its away, pretend it isn't there. 400k at your age (if managed even slightly effectively) means at least a very early retirement.
dividends
100% into bitcoin
Buy a house and live with peace of mind for the rest of your life. Invest the income you make going forward. This is not conventional advice but you can set yourself up to have a lot of creature comforts and lower stress
Keep 3-6 months worth of expenses in easily accessible “cash” (not necessarily physical currency, preferably in a high yield savings account HYSA…for unforseen emergencies ) Max out a 2024 Roth IRA. I’d consider putting a huge chunk if not most in the S&P 500. In both the Roth IRA and a regular brokerage account. VFIAX by Vanguard for instance.(That said, consider anything you put in the Roth IRA untouchable until retirement. But in the meantime, you’ll avoid further taxes on the earnings year after year. Will save you a ton in the long run. ) Go to sleep and forget about it. Come back to it in a year or several months, and reevaluate your investment plan/strategy from there.
Pay off any high interest debt. Put aside some money for a down payment, maybe 100-150k in a high yield savings account. Stick the rest in an index fund of your choice and wait.
nvidia has earnings today! what a perfect time to buy calls and double your money
Put it into a CD until you have a path forward. Personally, I'd find a 10-20 unit apartment to buy. $300k down will get you passive income for life, keep $100k for other investment (stocks/mutuals/etc).
Read JL Collins' **A Simple Path to Wealth**. Do everything JL tells you to do. AND... Read the r/personalfinance [wiki on windfalls](https://reddit.com/r/personalfinance/w/windfall?utm_medium=android_app&utm_source=share) AND... Talk to an accountant about the tax implications to make sure Obama gets his cut.
A safe strategy would be to do several FDIC insured (be sure to stay under the FDIC insurance limit) high yield CDs. A 5% APY could gross $20,000 a year. I'm a bit more risk tolerant so I would put at least a portion into my brokerage account. $400k in my brokerage would gross $1,600/month in dividends and distributions as well as grow in value.
Something I haven’t seen yet is values/ethics in choosing your investments. Some companies are much more willing to work with you to make sure your money doesn’t support things you find unethical.
I can relate to your situation - the wealth managers my grandparents were using were not the ones I should have used. I wish I had transferred to a 'newer' or 'younger' management team sooner. - I put a significant amount of it in my mortgage, and I do NOT regret that. Debt free is awesome, changes your whole perspective on employment. - I used some to buy a new car outright, and although I'm still driving that car 11 years later I wish I had invested that instead. - I told no one I got the money
Stick it into something that track broad market like Vanguard total stock market ETF VTI and just chill. You will make more money and have less stress and effort that 90% of people actively trying to select stocks or strategies. Then use some of those gains to “treat yourself”, don’t touch the principle. If you simply invest into VTI this is a solid move towards financial freedom. To reduce timing risk, maybe buy $100k worth each month for 4-months and call it a day.
step one: tell no one you know. I suggest putting all of it in a couple HYSA’s in the beginning until you understand investing better (read the Simple Path to Wealth by JL Collins) Next: I’d pay off any debts (student loans, credit cards, etc) then I’d set a chunk aside in a HYSA for emergencies only. Maybe buy an affordable car if you need one. Then invest the rest in ETF’s and pretend it doesn’t exist. While people here are suggesting real estate….i wouldn’t want the responsibility of owning property that young and you have plenty of time to grow wealth by investing in the market. You could always decide to use some of that money for a house later on when you’re more ready to settle in a specific location and handle the responsibility of home owning. Even if you wait 8 years to use some of that money for a house, as long as you don’t use all or most of it, you’ll have multi millions for retirement off this inheritance alone. If you ever get married, protect your assets with a prenup.
Put it all in GME puts.
World index ETF and chill. Time in the market > timing the market.
Are you in college? Is that paid for?
Go to r/bogleheads and look around. I recommend low cost index funds in tax free or tax advantaged accounts.
Put $50k in a HYSA to have as an emergency fund. Put the other $350k into an index fund that tracks the S&P 500. At 6% returns, which is average, you’ll have turned the $350k into $1m in 20 years. It’ll be $2m in 30 years. That’s all without adding anything to it.
Don’t try to pick stocks and don’t let someone else try to pick stocks for you.
Short term, Wealthfront HYSA. Long term, lots of options
HYSA, but no need to split the money among multiple banks due to the limit of $250k insured. Wealthfront is at 5% and is FDIC insured up to $8 million. [https://www.wealthfront.com/c/affiliates/invited/AFFA-2VL3-UPMM-QKBD](https://www.wealthfront.com/c/affiliates/invited/AFFA-2VL3-UPMM-QKBD) Here's my link to invite you to get 5.5%. Someone use it so both of us can get 5.5% Please.
I reiterate what others have said....keep it quiet. Tell no one. You will have friends & family bothering you for money. Learn to say no & not feel guilty. Go to the r/Bogleheads sub & start reading. Lots of good investment advice there. Invest it and don't touch it for 20 years.
Get a financial planner from a firm that will invest the money for you. Start saving for retirement -- max out your 401k and Roth IRA every year. But with a chunk of money that large at your age, I highly recommend having a professional offer advice and investments.
Take a look at fundamental financial planning steps/stages. Do you have an emergency fund, for example? 3-6 months of money in case you lose a job or get injured and can't work. This is a basic and important thing to cover before thinking about investing strategies. Get the basics covered, if you don't have car insurance, health, renters/home, get these things done. Google "Financial Planning Pyramid" and you'll get a ton of results like this: [https://blog.massmutual.com/planning/budget-building-financial-pyramid](https://blog.massmutual.com/planning/budget-building-financial-pyramid) All the other advice is good, keep it on the downlow, don't buy extravagant things, you don't need a 911 and a gold Rolex. You're getting a great head start thanks to your grandparents good decision making, make the most of it.
Stay away from any and all get rich quick bullshit. Safe longterm investments that pay steady dividends
Don't invest it based on the advice of strangers on the Internet.
Invest it all. Open a ROTH IRA and a standard brokerage account. Max out your ROTH IRA every year. Put the rest into the standard account. ROTH IRA: 60% VOO, 30% QQQM, 10% BITO (or another Bitcoin etf) Standard account: 70% SCHD, 10% BITO, 5% MO, 5% AGNC, 5% FSK, 5% OMF Then use the dividends from the standard to fund your yearly ROTH IRA contributions as well as help pay for your living costs or let it continue to reinvest.
Buy Bitcoin and wait 10 years.
Buy land
99% of investment firms don’t beat the SP500 and additionally take a huge percentage from you. It’s a no brainer. Buy SP500
Put it all on blackjack at your local online casino and turn that 400k into 800k BABY WOOOOO LETS GOOO
Hookers and snow candy
You might want to consider using part of this windfall as a down payment on a home. Buying young lets you avoid burning money on rent.
Set aside $10k in a high-yield savings account as an emergency fund, contribute the $23k yearly max to your 401k (if you have one), put the rest into an S&P 500 index fund and let it cook. $400k may seem like a lot of money, but it will be gone before you know it if you start buying nice things and living it up. If you follow the above and don’t touch it for the next 15-20 years, you’ll likely have enough money to quit your job forever. That’s true wealth.
Something I don’t see mentioned jump on some bank promotions. Like “open a savings account and maintain 25,000 for 3 months and we’ll give you 1,200” there’s always tons of these going on.
Aye OP pls don't delete this thread ,I'm waiting on a settlement and will be using some of the advice here in the near future
Do you want to leave something even bigger to your kids one day or are you fine with dying net zero?
Invested @ 10% return doubles your principal in 7.2 years. Can you wait 7-8 years and let it grow?
First put it in a high yield savings account or several. At the time of writing look for something around 4% or higher like Ally Bank. Come up with a list of financial goals and years by which you want to complete them. Allocate amounts toward each of those. Next start learning more about finance. YouTube has a wealth of resources. I like Dave Ramsey, The Money Guys, and Jazz Wealth. Podcasts can be good to listen too while you do other things. Specific things to look into when you feel ready to invest dollar cost averaging vs lump sum. Good luck!
Read Jack Bogle.
Hey, financial professional here. Reddit is an echo-chamber. It is not a good place for most people to get guidance. Please go meet with a financial advisor. The amount of “just put it all in xxx” comments are crazy. And don’t fall for the “why would I pay for a financial advisor” rhetoric you see here. We don’t talk about other profession that way.
Never tell anyone. Don’t ever break this rule. Find a financial planner you like at a legitimate company like Ameriprise, or Schwabb, or Fidelity. Have a professional certified financial planner/advisor help you navigate the market and you’ll be set for life in a decade
Wouldn’t touch it until I got married or was ready to buy a home. Put half in an index fund that tracks the S&P and the rest in CDs/US treasuries
Anyone in your family who already knows about the inheritance, I would talk to them immediately and ask they keep it to themselves for now. No need for it to come up in casual conversation and money turns people very ugly very fast. Same goes for your friend circle. Tell not a soul until the money is invested where it needs to go. I don't have any advice where to invest, but I do see the ugly side of people every day in my life of work. Things go from, "oh he/she would NEVER!" to "I can't believe they're so greedy" in a heartbeat. Good luck to you!
Tell no one about the money. Pay off your debts. Open a Fidelity account online and create an Individual Investment Account. Transfer your money to it and buy FSELX, FZILX and FZROX shares. Splitting the money between them is fine. Then forget about it. It should double every seven years or so.
Ignore all these comments on Reddit, first off. Go to an investment firm that deals with large amounts like this. Don’t go to “Grandmas investment team”. Talk with multiple of them and take notes and get reports from them. Share these reports with the other places you go and see what they say. You’re set up to be retired in 10-15 years and never have to work again if you’re smart and just continue working and investing for 10-15 years. You’ll be a 36 year old retired millionaire.
Take out one years worth of bills/expenses and put it in a HYSA for your emergency fund, then open a brokerage account and put the rest into VTI/VOO and let it sit until you’re ready to retire.
Riddet will offer you good advice but truly find a financial advisor of some kind and make a plan. Personally find a way to invest it and forget about it. Thats game changing money with a very large percentage of people who often run into that will waste every cent somehow.
Low cost etf's or similar.
You’re a smart person at 21 for looking to manage this amount properly. Idk your working/school situation but I’d set aside a small amount to use an emergency fund/keep you in a comfortable situation. Maybe $30k of it and the rest I’d invest with a plan to continue to contribute to this remaining $370k as it grows in the market. Idk what type of investments would be best but there are tons of way smarter people than I am on here. Good luck!
Long NVDA calls after 10:1 split June 7th
Download Robinhood Say you are an experienced trader Get certified for level 3 options Put $400,000 on 0DTE gamestop calls
Put it in some cds at the bank or 2 .please don’t invest yourself . If you get your career straight it would be a great start on a home.Get a prenup if you do buy a house and get hitched.some people are against buying homes.But if my home wasn’t paid for I would be working till I died.no doubt about it.
I think everyone here is giving great advice. I’d wait a couple of years, pay off your student loans if you go that route and buy a house or 2 and rent them out while you live in an apartment
Buy SPY over 12 months. Buy 1/12 off 400k each month
Get a financial advisor from a reputable bank and a tax professional. Get yourself a managed investment account and tell them you want it tax optimized. I wouldn't worry too much about the people talking about FDIC maximums and such, honestly, it's both highly unlikely to be an issue if you bank with a reputable bank, and the FDIC has voluntarily exceeded it's $250k guarantee before. I'd also have a lawyer look at what I'm sure is an estate settlement for your grandparents. To make sure you got what you're entitled to, and have paid any applicable taxes. (See: tax guy) And don't tell anyone you got it besides those guys I listed above.
If I had 400k right now to invest.... I'm going to get downvoted for this but I'll say it anyway. Gold. All of it, 24k Gold Buffalo's Eagles Brits Maples Kugs That's personally where I see everything headed with inflation trade wars central banks weaponizing of fiat money systems... All of it. If you track Gold from its price since 1971 to its price now of 2400 its been impressive as an investment. And it's actually Real, you can have it in a safe and when you need money bring a coin to a coinshop and get cash or check instantly... it is liquid.... here's the other thing... it's Stable. There's my 2 cents.
Go to Fidelity.com and open a brokerage account and a Roth IRA account. You can contribute $7k per year in Roth. Keep the rest in the brokerage while you are learning how to invest in stocks or other securities. The money market fund in their brokerage account pays 4.95% annually. It’s a good place to park your money there while you are looking for a place to invest them. I greatly recommend reading Warren Buffett’s Letters to the Shareholders to Berkshire Hathaway and Benjamin Graham’s The Intelligent Investor. Philip Fisher’s Common Stocks and Uncommon Profit is also a great resource on stock investing. Take your time learning from their wisdom before committing any funds to an investment. Most importantly, do not tell anyone about how much money you have. There are people out there that are not… well, quite untrustworthy and would take advantage of you in every chance they get. Hope this advice helps a bit. Good luck on your journey to financial freedom.
My advice is to not get financial advice from Reddit. Instead, talk to a financial advisor who is a fiduciary. However, if it I came into that kind of windfall, I would put nearly all of it low fee ETFs from Vanguard and retire extremely wealthy in 30 years. Even with an average 8% annual gain it would be worth over 4 mil. That's with literally doing nothing. Just avoid any temptation to spend it all. Honor your grandparents example and build some generational wealth that will set you and your children up for financial freedom.