What should I invest $1m in?

Hi All,

I have no debt. Own PPOR $1.6m and earn around $100k per annum.
I have $1m - $2m to invest and wanted your thoughts on what I could invest
The primary goal would be income etc

Thanks

 

Age? Retirement age? Goals? Current portfolio? Risk appetite? Etc

• Salary sacrifice & bring forward contributions to super may be of some value if you can forego the income in the short term.

• Active or passive share trading/index funds.
• Listed/unlisted property trusts
• Direct property

 

cash or borrowings?
Any non-deductible debt?
goal is vague.

 

If primary goal is income, look for dividend-paying stocks where the dividend growth aims to outpace inflation. RBA targets inflation between 2% and 3% so the general aim is that the growth in Dividend per Share outpaces inflation. Fortunately there are dividend investments with a good track-record of growth.

Australian Dividend Aristocrats on the ASX | Capitalistic Man

In particular look at stocks such as SOL, BKW and listed investment companies like BKI, MLT, ARG, AFI. All have built-in diversification.

$1M-$2M is a big sum to invest so look into strategies such as dollar-cost averaging, which is easing your money into investments:

• What’s better: Dollar-cost averaging or lump-sum investing? | Sharesight
  
• What Is Dollar Cost Averaging, & How Does It Work? | Canstar

Also read the book Motivated Money.

Motivated Money | Knowledge to make informed investment decisions

Then start following the Peter Thornhill threads which get quite technical.

You can also mix it up by investing in index funds.

 

I have no debt. Own PPOR $1.6m and earn around $100k per annum.
I have $1m - $2m to invest and wanted your thoughts on what I could invest
The primary goal would be income etc

MORE INFOR FOR YOU
I am 60 years old with 45 year old partner
Self Employed earning $100k plus per annum
No Debt at all
$500k in Bank Stocks
$1.5m cash earning nothing
Want to build a passive income stream so kids can choose what they want to do in life....

 

As a general guide you would want to invest in an asset that grows in value - potentially one that pays income, though this is not necessarily needed.
If you have that much cash you could probably return about $100k pa in income/growth potentially. Carefully consider ownership structure and funding of this - which you should get legal advice on.

As to what to invest in, that is something you would need financial advice on.

 

Do u know anyone I can talk too?

 

about which?

 

That's a dangerous thing to aim for. The answer if you give them enough may be...."nothing".

Maybe rephrase the sentence to be "Want to build a passive income stream so I can choose what I want to do in life.

That aside, I would plonk the lot on a mix of dividend paying blue chip stocks and LICs/ETFs. Perhaps a 20/50/30 split.

 

I have a testimonial trust for them that will be used for their assets to allow MY KIDS and NOT ME to have a life they want.....I dont need anything

 

Testamentary Trust?

 

yep that one

 

Frankly @Richard , you've just come here to humble brag about all your money and your sexy young wife and lucky family, and now I'm going to go and cry in the corner.


but well done sir.

 

Sorry I do not mean to make anyone feel bad.
I have made heaps of money and lost heaps of money....in fact I probably should be worth triple what I have
Hence why I am reaching out for advice

ALSO NO ONE IS JUDGED BY THEIR MONEY BUT WHAT THEY ARE AS A PERSON...........

 

Hi Richard,
Thanks for posting! You should get some good ideas from the crowd here.

Where is your cash right now? What you can do immediately while you further plan what to do is to get the best possible interest. I sold our former PPOR some months ago so had to work out a plan for the proceeds. In the interim I put the money in high interest accounts, with these aims:

- Get the best interest possible
- Take advantage as much as possible of the $250k government guarantee in these strange and uncertain times
- Have the money readily available

At the moment these are the options I'm using:
Macquarie Bank: 1.2% first 250k, .95% after
AMP: .85%
HSBC: .85% (requires deposit of $300 per month)

I did have an account with Xinja, but they're gone now.

All of these accounts could be opened on-line just using your passport or driver's licence number. Transfers in and out have been quick and easy.

With $1.5M in cash you should be getting $41 per day using the above options which is a lot better that nothing!

Once this is done then plan what comes next - do the suggested reading about dividend paying stocks, LICs etc.

 

great idea....thx

 

just my arrogant opinion:
Why give kids fish when you can teach them to fish.
I would talk to my kids and say "I have some money I would like to invest 100k max, what you think would be good?"
Ask them to do more research and come back with details and numbers.
Then offer to invest with them.
Kids says "This biz/house/wateva is great!" Ok kid I put the deposit, you pay the rest.

 

Reminds me of a quote:
give the kids enough, to help them achieve something
don't give them so much, that they will do nothing

 

Because my kids deserve more than living in this corrupt financial system.....I have taught them how to use the system so they will be fine. They like anyone just need starting capital to take any pressure off them. And remember the wealthy always get richer not poorer.....knowledge is wisdom

 

Richard, What is your super situation? You could consider making a non-concessional contribution. $100k per year, or up to $300k using the bring forward rule. Personally I keep a separate super account for non-concessional contributions, to stop the tax and tax free components getting too scrambled. Keeping the contributions in separate accounts won't benefit you, but makes it a bit easier to do a withdraw/re-contribute exercise to maximise the tax free parts. You won't benefit from this but adult children will.
As it is already January if you do go down the super contribution path you could do $100k now and then $300k in July (i.e. next financial year), rather than $300k now.
You could also make contributions into your children's super, it might be 40 years before they retire but say a $50k contribution now could make a huge difference to their retirement...

*not advice, just some ideas to explore further*