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Residual income of around $10K per year on that $100K I am going to inherit. Is this an insane expectation?
Yes, 10k income on a 100k investment is absolutely insane.
Quote:
Originally Posted by Kavalier
Should I expect a reasonable return on that of aroooooooound $2K? 3K? 5K? or more?
2K to 3K--As safe as anything gets in this world. 4K is kind of the sweet spot. Not 100% safe, but more than 90% safe. 5K still reasonably safe but shaky, especially if you want this money to last and keep growing for you the rest of your life.
These amounts I'm giving also assume you adjust upward every year according to the Consumer Price Index. And they assume you're at least 50% invested in stocks, with the rest in investment grade bonds.
Quote:
Originally Posted by Kavalier
Are there just way too many variables for you to speculate as to what I could want to make as it pertains to:
Well no one can predict the future. But a lot of research has been done on this subject, and based on over 100 years of investment return data, they've found that 4% with annual increases for the Consumer Price Index is a conservative, but not quite bullet proof way to go if you invest at least 50% to 75% in stocks. If you get more conservative than that, your portfolio is actually more likely to fail. Think of bonds and CDs right now. Many investment grade bonds or CDs don't even pay 2% right now. So if you take out 3% a year, you're gonna be in trouble.
Quote:
Originally Posted by Kavalier
RISK? (how much I am willing to risk with that inheritance?)
Most people suck at assessing risk. Taking no risk at all is actually risky. Keeping it all in investment grade bonds or CDs or savings accounts doesn't even allow your money to keep up with the inflation rate.
Quote:
Originally Posted by Kavalier
Lastly, I HATE speculations/stocks/the stock market. I don't know very much about it, no, but thought of a small group of international bankers getting their jollies off of a 90 percent earth population in a state of permanent serfdom makes me sick.
Honestly, you're giving yourself away as a total financial illiterate here. In one breath you admit you don't know anything and in the next you're talking sh*t about stuff you have no clue about, but talking as if you do. Do you want to learn or just talk out of your butt?
Quote:
Originally Posted by Kavalier
That's just a personal thing. I've read a book or two on that subject and have seen enough funny business as it pertains to "speculations" and the manipulation that clearly occurs (in my mind) and how easily they manipulate the lives of the working/middle class Westerners.
Dude, everything is manipulated. You can't get away from it. Unless you're going to go live alone in a cave, you can't avoid corruption and manipulation in all kinds in all human systems (financial, political, education, etc.)
Quote:
Originally Posted by Kavalier
I realize in this world that $100K is not very much, and next to nothing comparable to the way some people live.
Correct. At the same time, it can grow to a tidy sum over time if you can invest it and resist touching it for even a few years and then take out just a small percentage every year, say 3%, plus annual inflation adjustments. In most scenarios, you'd end up with much more money (in inflation adjusted terms) than you started with after 30 years. So that means you'd be able to slowly upgrade your standard of living over time.
For example, at a fairly conservative 6% rate of return, 100k grows to 133K after 5 years and 179K after 10 years, 320K after 20 years, and 574K after 30 years.
Quote:
Originally Posted by Kavalier
I think I am frugal. If I can turn that $100K into a residual income for even a "studio" over my head until I decide my next move in life (possibly going to school, or marrying, or just looking for a better job), then that would be a blessing beyond words.
If you mean "studio apartment" money--No. Not even in a cheap area, but maybe I'm wrong. Can you get a studio apartment for $325 a month anywhere? I don't think so. The amount you're talking about will throw off enough safe income to pay for your groceries--that's it. If you don't touch it, maybe in 20 years it'll be enough to pay the rent on a small apartment.
Quote:
Originally Posted by Kavalier
My parents were good people - they weren't drug addicts or alcoholics or have infidelities to each other - they never drank or smoked or cursed and my father never treated women as objects or with dirty words or looked at them poorly.
They were good. They both worked hard and gave 30+ years each to their respective companies. They were honorable people who had a deep Christian faith.
I do not want to waste what they gave me; I would like to be smart and prudent and sound with that sum of inheritance.
Good on you for doing your best to honor your parents by not being a wastrel That's a good start.
You really need to learn the basics of how stock and bond markets work.
Long story short. Stocks are ownership pieces of corporations. Typical very long term returns have been about 9.5% since the 1920s. Bonds are debt issued by corporations or government entities who want to borrow money. They are safer, but as a result, have lower returns. Long term returns since the 1920s are about 5.5%. Currently, interest rates are very low, so you should expect something more like 3% for bonds over the next decade. Stocks are harder to predict, but even the more optimistic people are assuming something like 6% to 7% over the next decade.
In any given year stocks / bonds will fluctuate in value. The stock market can fluctuate pretty wildly. Bonds are more boring. Most people should own some bonds to calm their nerves when stocks are crashing.
The thing is, you don't have to speculate (i.e. buy and sell all the time). You don't even have to pick your own stocks or bonds. They now have these things called index funds. An index fund just buys the whole market, or whole segments of the market. So there are index funds that buy all the stocks in the stock market. And there are index funds that buy all the bonds in the bond market. If you put the two together, you can get decent long term returns. You WILL have losing years and should expect such. But over the last 100+ years, the winning years have more than made up for the losing years--by far (and despite all the manipulation that exists).
With your 100K, you could buy a mutual fund like Vanguard Balanced Index. It's comprised of 60% stocks (all the stocks in the stock market) and 40% bonds (all the investment grade bonds in the bond market). The thing about investing is that successful investing is BOOOOOOOORRRRRING. Boring, but not too boring. You don't want it all in CDs or investment grade bonds that barely keep up with inflation--if they even do that.
Anyway, you could call Vanguard Funds today and just invest the money in Vanguard Balanced Index. It's returned more than 7% annualized over the last 10-15 year periods. But as I said, it probably won't do as well of the next 10 years due to low interest rates on bonds and high prices on stocks right now. But 5%-6% returns seem like a reasonable assumption for the next decade, although it will vary a lot from year to year. That's just the nature of the beast.
You can call Vanguard Funds right now to get started:
Another thing...To be honest, I would recommend you find a better paying job first and let that money grow--and keep adding to it. 100K, even if you let it grow for 30 years without touching it, probably won't be enough to fund a decent retirement in 30 years. But adding even a modest amount of money to it over time, say $200 to $300 a month, can do wonders for you over time. Even if you can't do that right way, you could make it a goal.
Last edited by mysticaltyger; 06-16-2018 at 10:10 PM..
You've gotten a lot of good advice here, although some of it seems contradictory on the surface of things (but mostly isn't).
The hard part for us is we don't know you, your skills, your personality, your aptitudes, your willingness and tolerance for certain things. Because there are pros and cons to any choice you make--no matter what.
For instance, no way in hell I would ever be a landlord. I hate fixing things. I would hate screening tenants. I would hate evicting them (and if you are a landlord long enough, you WILL have to do this). I hate dealing with contractors. Just.....no.
And that doesn't even include the skills of knowing what the local real estate market is like in your area, what the local real estate rental market is like in your area, what local real estate laws are, what the state and federal tax laws related to real estate are, etc.
To me, it would be easier just to put it in a fund like Vanguard Balanced Index, and just keep adding money to it. That seems so much easier, lower stress, and can potentially earn equally good returns over time (although no one can know for sure). But other people find the ups and downs of the investment markets stressful. My answer is for them to not check their accounts except maybe once a year, if that. But some people just can't resist checking or moving their money around (they almost always shouldn't), even if they know they don't plan on using the money for a decade or more.
Others have suggested putting the money in high yield savings or CDs. That's a good choice for the short run. Keep it in a CD for a year while you figure things out. But, you definitely don't want to leave it in CDs or savings accounts forever. Those are short term vehicles.
As others have also said, you really shouldn't be spending any of this money on consumption items (food, clothes, eating out, vacations, etc) unless you're in a true emergency and you absolutely have no other options (and you have to be brutally honest with yourself about that). Even buying a house or condo with it for yourself to live in, although perhaps a good use for the money, should be viewed as more of an expense than an investment--because the house you live in still doesn't put cash in your pocket. There are still property taxes, maintenance, furnishings, insurance, repairs, etc.
Maybe you'll want to take some of this money and invest it in yourself in classes that can earn you more money. Of course, once again, you gotta be careful with that, too. Education usually pays off, but not always. You have to be smart and realistic about it.
Maybe you'll leave this money in a CD or high yield savings account or CD for a year and, while you're doing your day job, you learn about real estate at night. You research the local real estate market, talk to people in the business, etc. You take a full year to really learn all aspects of what it's like to be a landlord.
I think this is still one of the best blog series' on real estate that I have found (at least for the basics):
Paula Pant at www.affordanything.com is pretty good for more advanced topics on real estate. But with real estate, you really have to know and understand the local market. so these resources are still just starting points.
With stocks and bonds, it's more about just understanding that these markets go up and down and that it's normal--despite the fact that the media acts like it's a new thing every time the stock market falls by more than 10% from its highs--(Hint: it's not). For me that's easier. It doesn't take a lot of research or effort to buy a mutual fund like Vanguard Balanced Index, or the Vanguard 500 Stock Index Fund (which, by the way, is all stocks and no bonds...better returns over long periods, but bigger ups and downs).. But it does take a lot of psychological fortitude to tune out the media BS on the stock market. For some people that's hard.
Anyway, I hope this was helpful rather than confusing.
For the short term, I think 2 things are clearly wise choices:
1. DON'T SPEND THE MONEY ON CONSUMPTION ITEMS!
2. Put it in a savings account or CD for up to a year to LEARN about ALL your options first. Don't rush into anything.
A reputable web site like Mr. Money Mustache can help you get your arms around topics like the stock market as well as more philosophical issues around spending and what actually makes people happy (Hint: once the very basics are taken care of, more stuff adds little or nothing to your happiness).
Dave Ramsey (author of The Total Money Makeover) also gives a solid overall blueprint on how to handle money with a Christian slant (Although his investment advice is lousy. You don't need one of his "preferred advisors" to invest in overpriced mutual funds for you. You can learn to do that yourself.) Despite the different slant, 80% of what he says is similar to what Mr. Money Mustache says.
So really take the time to study, read, and learn and make the decision(s) that are the best fit for you.
Last edited by mysticaltyger; 06-16-2018 at 11:12 PM..
Just don't be like my ex-best friend, whose grandma died and left him $140,000. He asked my dad what to do with it as far as investing, which to my dad was kind of laughable because it's just not enough money to be concerned about. Like stash it away somewhere and forget about it, just like fumbling said. Seriously. Put it in an index fund, like it never happened, and consider it retirement savings.
My ex-best friend decided it was time to stop working, live the retired life, and start dining out with his 300 pound girlfriend (this is relevant because she could eat A TON!) on a regular basis, like daily. I am the kind of person who hates to see anyone I care about make bad decisions because it pains me, like I want to help them, but you realize in life you cannot do more than just provide advice. You can't MAKE people be smarter or make better decisions. So I watched as he squandered all of this money, frittered it away bit by bit, faster than I could have imagined. He was renting an apartment and I think it was about 3.5 years later, he had run through all of the money, because he wasn't making ANYTHING. I urged him to put the money aside, or use a small portion of it to go back to school (really smart guy, extremely intelligent actually, a scary good programmer, Web designer, photographer, the guy has so many talents it's amazing and I hired him over the years for all of those jobs) to get the proper certifications that could help him advance to some real money. This was a big moment for him. I also told him whatever you do, make sure you're not spending off the top with no income. If you have $140K and your expenses exceed your income by $1K per month, that money is going to last a really long time, even though it's not sustainable. If you're spending $4K per month and taking in $0 that money is going to be gone so fast you won't know what hit you.
Sure enough, he lost all of the money, spent everything on just cost of living, nothing to show for it except for living like a playboy or retiree for the better part of 4 years. Even though the guy is a loser, I still feel bad for him that he just wasted all of the money like that.
Don't be paralyzed by inaction I think is the best lesson for you. Maybe I'm speaking out of my butt, but I think at various times we have ALL been paralyzed temporarily by inaction. Even when it's completely inconsequential. "Oh man, I don't know, what should I do Friday night, uhhh... I can't decide. My friends are going out. But I want to watch a movie with my GF. On the other hand, I really wanted to catch up on my reading. Hmmm..." Pretty soon Friday night comes and goes, and you never did decide what to do, so you did nothing. It's much better to just pick something, even the worst thing, and go with it, because at least you did something. I think my friend sat around trying to decide what to do for so long, he literally ran through the money.
I'll give you another example, this isn't to scare you, just to make you aware of what happens to lots of people. My sister up until recently had a horrible conception of money, my dad called her "Paris Hilton of the North" because she just couldn't grasp how to spend her money, how to manage it, what things should cost, just clueless. She has become way better, and I am proud of her, so this isn't to diss her but it's a cautionary tale. We started at the same point, with the same financial situation, and over the years she constantly rented, even though she owned a condo, but she didn't want to live there, so she paid rent and these HOA dues / mortgage for that place, and wasn't actively managing it, finding another renter for it, etc. My dad had to bail her out, buy the place at a discount (so she lost money), and my dad rented it out. He made good money, he sold it for a profit, because that's what he does. My sister lost money on it, flushed more money down the drain in rent, went on various vacations, blew money on eating out and drinking, and who knows where the rest went. Literally, who knows.
During that period of time I went from the same value of condo (20% down, so $75K or so in equity) to downsizing to a place 3 times cheaper (just $128K), because I could pay all cash for it and it cut my monthly expenses by more than $2,000, and I moved again to a place not much more expensive with my GF and I paid all cash for that, too, while keeping the previous condo and renting it out. I watched my monthly expenses carefully, we rarely went out to eat, we went to see movies on $5 Tuesdays if we went out at all, and I tracked every expense on an app. I lived like I was the poorest person I knew, even though I was the richest by far, because I wanted a better tomorrow not a better today. I even sold off a bunch of old collectibles and worked my butt off growing my company, so that I could keep growing my wealth. Eventually I sold both condos, the two cheapies I owned free and clear, and bought a luxury condo downtown with a mortgage and a large downpayment to keep the mortgage small. Two years later, I sold that condo for $125K profit, tax free, because it was a primary residence and you don't pay taxes for a gain below $200K if you lived there at least two years. I now own my (cheaper) house, about $625K, almost free and clear (by year's end). That was largely done through years of frugal living, wise investing at the right times on real estate and in the right places, and always living well below my means. My sister is renting and has little in the bank. Same starting point, much different results, and I own two nice cars too, an SUV and a sports car, she owns a very old and run down car she actually bought 50% of from me (my mom's old car that we inherited upon her death) for $1,000.
How you choose to manage your money will impact what kind of lifestyle you lead many years down the road. If you spend your money on real estate, the odds are you will have an appreciating asset, even if the real estate only appreciates in line with inflation, at least the money is there. If you spend your money on anything cost-of-living related, it's simply gone, flushed down the toilet. A necessary evil, yes, but keep your expenses low and your income higher, and save for the future.
I don't think I have ever lived close to outside of my means. I was always trying to set myself up for down the road. The $2,300 compact car lasted me 10 years, for example and I only put a starter and alternator in it all that time.
That's the type of person I am. The last daily driver I bought was a similar car in flawless condition, for $1200 and I have another I paid for about $1500 that runs flawless.
I was always trying to shoot for the bigger picture because I saw all sorts of people around me just blowing through their paychecks every weekend.
(I WILL RESPOND TO THE OTHER POSTS TOMORROW. thanks to you all for your words. K)
I don't think I have ever lived close to outside of my means. I was always trying to set myself up for down the road. The $2,300 compact car lasted me 10 years, for example and I only put a starter and alternator in it all that time.
That's the type of person I am. The last daily driver I bought was a similar car in flawless condition, for $1200 and I have another I paid for about $1500 that runs flawless.
I was always trying to shoot for the bigger picture because I saw all sorts of people around me just blowing through their paychecks every weekend.
(I WILL RESPOND TO THE OTHER POSTS TOMORROW. thanks to you all for your words. K)
Stop in at your bank first and open those CD's.
Settle that question.
THEN explore learning about investments as a hobby as the CD's mature...
while focusing on job #1: stabilizing and improving your EARNED income situation.
Don't even consider actually investing until you've done this improving and stabilizing
and (AND!) have enough earned income to fund retirement accounts with your own money.
I suspect that once you do learn the various things that so many here seem able to cite
off the cuff... you'll discover that most of that cash should be kept as an 'emergency fund'
and maybe never get "invested" into anything more than very safe CD's or T-billes, etc.
Last edited by MrRational; 06-17-2018 at 08:59 AM..
OP, take a look at trade schools and see if there is something you think you could do and that would make a living. You could invest in yourself, learn a job skill that pays a living wage
I recomend HVAC. Heating, vent, and air conditioning, the work is in high demand, pays well, isn't too heavy or dirty.
Truck driving if you like to drive. Cheap for the school to get a license.
Plumbing pays well. It can be a bit dirty and you have to be strong enough to break open rusted pipe fittings, but that isn't super strength.
Electrician pays well, work is not heavy, it can be dangerous if you aren't careful, but safe if you pay attention.
Other than that, at your income level, you could live just about anywhere. Pick a place where real estate is cheap and pay cash for a house. Then you always have a place to live and just need to earn enough money for food, utilities, insurance. Look someplace a bit warmer to save winter heat bills. Alabama, Louisiana, gulf states. There are low wage type jobs every where and you are doing some business online which can be done from anywhere. There is no reason you can't move to someplace cheaper. Even just a less expensive town in the state you are already in.
Last edited by oregonwoodsmoke; 06-17-2018 at 10:11 AM..
Put it in a trust fund, where it will be safe. You seem to be working yourself into a nervous anxiety panic attack over losing the money.
I am in a panic over it. I hate money. I think this stems back to an incident back around 2003 when I was 23 and basically lost $10K in one night. I had saved $15K at that point. Without going into specifics the Gov't got $4K out of that incident. It was grotesque but I did deserve it.
Though I saw it before that. Friends that treated money like it was to be thrown around, and wasted.
Moreover, I've seen how the working man really gets the shaft in this country. I had a friend rack up a $70K bill at a hospital - he got out of it because he was "indigent". My mother, on the other hand, similarly got a $70K bill for a medical condition she had no control over, and even though she retired in a railroad pension (which are very good), she still was on the hook for $7K of it.
I hate the way the system is rigged and the working/middle-class man gets it, and the upper- and lower-classes skate.
So yes I am in a nervous wreck over it and I am panicking and whatnot. Not many people I can talk to about it.
Another option my BIL just told me was I could take the $100K and put it into a low payment mortgage on a townhouse or something...it's just another option, I guess.
Another option is I could rent out my sister's townhouse which she and that BIL own now and make decisions down the road.
Put it in a trust fund, where it will be safe. You seem to be working yourself into a nervous anxiety panic attack over losing the money.
Quote:
Originally Posted by mysticaltyger
Yes, 10k income on a 100k investment is absolutely insane.
2K to 3K--As safe as anything gets in this world. 4K is kind of the sweet spot. Not 100% safe, but more than 90% safe. 5K still reasonably safe but shaky, especially if you want this money to last and keep growing for you the rest of your life.
These amounts I'm giving also assume you adjust upward every year according to the Consumer Price Index. And they assume you're at least 50% invested in stocks, with the rest in investment grade bonds.
Well no one can predict the future. But a lot of research has been done on this subject, and based on over 100 years of investment return data, they've found that 4% with annual increases for the Consumer Price Index is a conservative, but not quite bullet proof way to go if you invest at least 50% to 75% in stocks. If you get more conservative than that, your portfolio is actually more likely to fail. Think of bonds and CDs right now. Many investment grade bonds or CDs don't even pay 2% right now. So if you take out 3% a year, you're gonna be in trouble.
Most people suck at assessing risk. Taking no risk at all is actually risky. Keeping it all in investment grade bonds or CDs or savings accounts doesn't even allow your money to keep up with the inflation rate.
Honestly, you're giving yourself away as a total financial illiterate here. In one breath you admit you don't know anything and in the next you're talking sh*t about stuff you have no clue about, but talking as if you do. Do you want to learn or just talk out of your butt?
Dude, everything is manipulated. You can't get away from it. Unless you're going to go live alone in a cave, you can't avoid corruption and manipulation in all kinds in all human systems (financial, political, education, etc.)
Correct. At the same time, it can grow to a tidy sum over time if you can invest it and resist touching it for even a few years and then take out just a small percentage every year, say 3%, plus annual inflation adjustments. In most scenarios, you'd end up with much more money (in inflation adjusted terms) than you started with after 30 years. So that means you'd be able to slowly upgrade your standard of living over time.
For example, at a fairly conservative 6% rate of return, 100k grows to 133K after 5 years and 179K after 10 years, 320K after 20 years, and 574K after 30 years.
If you mean "studio apartment" money--No. Not even in a cheap area, but maybe I'm wrong. Can you get a studio apartment for $325 a month anywhere? I don't think so. The amount you're talking about will throw off enough safe income to pay for your groceries--that's it. If you don't touch it, maybe in 20 years it'll be enough to pay the rent on a small apartment.
Good on you for doing your best to honor your parents by not being a wastrel That's a good start.
You really need to learn the basics of how stock and bond markets work.
Long story short. Stocks are ownership pieces of corporations. Typical very long term returns have been about 9.5% since the 1920s. Bonds are debt issued by corporations or government entities who want to borrow money. They are safer, but as a result, have lower returns. Long term returns since the 1920s are about 5.5%. Currently, interest rates are very low, so you should expect something more like 3% for bonds over the next decade. Stocks are harder to predict, but even the more optimistic people are assuming something like 6% to 7% over the next decade.
In any given year stocks / bonds will fluctuate in value. The stock market can fluctuate pretty wildly. Bonds are more boring. Most people should own some bonds to calm their nerves when stocks are crashing.
The thing is, you don't have to speculate (i.e. buy and sell all the time). You don't even have to pick your own stocks or bonds. They now have these things called index funds. An index fund just buys the whole market, or whole segments of the market. So there are index funds that buy all the stocks in the stock market. And there are index funds that buy all the bonds in the bond market. If you put the two together, you can get decent long term returns. You WILL have losing years and should expect such. But over the last 100+ years, the winning years have more than made up for the losing years--by far (and despite all the manipulation that exists).
With your 100K, you could buy a mutual fund like Vanguard Balanced Index. It's comprised of 60% stocks (all the stocks in the stock market) and 40% bonds (all the investment grade bonds in the bond market). The thing about investing is that successful investing is BOOOOOOOORRRRRING. Boring, but not too boring. You don't want it all in CDs or investment grade bonds that barely keep up with inflation--if they even do that.
Anyway, you could call Vanguard Funds today and just invest the money in Vanguard Balanced Index. It's returned more than 7% annualized over the last 10-15 year periods. But as I said, it probably won't do as well of the next 10 years due to low interest rates on bonds and high prices on stocks right now. But 5%-6% returns seem like a reasonable assumption for the next decade, although it will vary a lot from year to year. That's just the nature of the beast.
You can call Vanguard Funds right now to get started:
Another thing...To be honest, I would recommend you find a better paying job first and let that money grow--and keep adding to it. 100K, even if you let it grow for 30 years without touching it, probably won't be enough to fund a decent retirement in 30 years. But adding even a modest amount of money to it over time, say $200 to $300 a month, can do wonders for you over time. Even if you can't do that right way, you could make it a goal.
Quote:
Originally Posted by mysticaltyger
You've gotten a lot of good advice here, although some of it seems contradictory on the surface of things (but mostly isn't).
The hard part for us is we don't know you, your skills, your personality, your aptitudes, your willingness and tolerance for certain things. Because there are pros and cons to any choice you make--no matter what.
For instance, no way in hell I would ever be a landlord. I hate fixing things. I would hate screening tenants. I would hate evicting them (and if you are a landlord long enough, you WILL have to do this). I hate dealing with contractors. Just.....no.
And that doesn't even include the skills of knowing what the local real estate market is like in your area, what the local real estate rental market is like in your area, what local real estate laws are, what the state and federal tax laws related to real estate are, etc.
To me, it would be easier just to put it in a fund like Vanguard Balanced Index, and just keep adding money to it. That seems so much easier, lower stress, and can potentially earn equally good returns over time (although no one can know for sure). But other people find the ups and downs of the investment markets stressful. My answer is for them to not check their accounts except maybe once a year, if that. But some people just can't resist checking or moving their money around (they almost always shouldn't), even if they know they don't plan on using the money for a decade or more.
Others have suggested putting the money in high yield savings or CDs. That's a good choice for the short run. Keep it in a CD for a year while you figure things out. But, you definitely don't want to leave it in CDs or savings accounts forever. Those are short term vehicles.
As others have also said, you really shouldn't be spending any of this money on consumption items (food, clothes, eating out, vacations, etc) unless you're in a true emergency and you absolutely have no other options (and you have to be brutally honest with yourself about that). Even buying a house or condo with it for yourself to live in, although perhaps a good use for the money, should be viewed as more of an expense than an investment--because the house you live in still doesn't put cash in your pocket. There are still property taxes, maintenance, furnishings, insurance, repairs, etc.
Maybe you'll want to take some of this money and invest it in yourself in classes that can earn you more money. Of course, once again, you gotta be careful with that, too. Education usually pays off, but not always. You have to be smart and realistic about it.
Maybe you'll leave this money in a CD or high yield savings account or CD for a year and, while you're doing your day job, you learn about real estate at night. You research the local real estate market, talk to people in the business, etc. You take a full year to really learn all aspects of what it's like to be a landlord.
I think this is still one of the best blog series' on real estate that I have found (at least for the basics):
Paula Pant at www.affordanything.com is pretty good for more advanced topics on real estate. But with real estate, you really have to know and understand the local market. so these resources are still just starting points.
With stocks and bonds, it's more about just understanding that these markets go up and down and that it's normal--despite the fact that the media acts like it's a new thing every time the stock market falls by more than 10% from its highs--(Hint: it's not). For me that's easier. It doesn't take a lot of research or effort to buy a mutual fund like Vanguard Balanced Index, or the Vanguard 500 Stock Index Fund (which, by the way, is all stocks and no bonds...better returns over long periods, but bigger ups and downs).. But it does take a lot of psychological fortitude to tune out the media BS on the stock market. For some people that's hard.
Anyway, I hope this was helpful rather than confusing.
For the short term, I think 2 things are clearly wise choices:
1. DON'T SPEND THE MONEY ON CONSUMPTION ITEMS!
2. Put it in a savings account or CD for up to a year to LEARN about ALL your options first. Don't rush into anything.
A reputable web site like Mr. Money Mustache can help you get your arms around topics like the stock market as well as more philosophical issues around spending and what actually makes people happy (Hint: once the very basics are taken care of, more stuff adds little or nothing to your happiness).
Dave Ramsey (author of The Total Money Makeover) also gives a solid overall blueprint on how to handle money with a Christian slant (Although his investment advice is lousy. You don't need one of his "preferred advisors" to invest in overpriced mutual funds for you. You can learn to do that yourself.) Despite the different slant, 80% of what he says is similar to what Mr. Money Mustache says.
So really take the time to study, read, and learn and make the decision(s) that are the best fit for you.
Quote:
Originally Posted by MrRational
Stop in at your bank first and open those CD's.
Settle that question.
THEN explore learning about investments as a hobby as the CD's mature...
while focusing on job #1: stabilizing and improving your EARNED income situation.
Don't even consider actually investing until you've done this improving and stabilizing
and (AND!) have enough earned income to fund retirement accounts with your own money.
I suspect that once you do learn the various things that so many here seem able to cite
off the cuff... you'll discover that most of that cash should be kept as an 'emergency fund'
and maybe never get "invested" into anything more than very safe CD's or T-billes, etc.
I read all of your posts and appreciate the time and effort you put into them. Lots of information here.
My siblings and I are going to see my dad's financial adviser tomorrow afternoon to see what some options are...
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That's a good start. 
