What would you do with 1m cash?

Discussion in 'Money Management & Banking' started by Gavin Ng, 26th May, 2017.

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  1. Gavin Ng

    Gavin Ng Well-Known Member

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    Really enjoyed the "easiest way to make $1m from property" thread so a bit of a Friday mood post.

    How would you invest if you have $1m?
     
    Gavin Ng, 26th May, 2017
    #1
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  2. 158

    158 Well-Known Member

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    Hookers, Coke and alcohol, then waste the rest.

    pinkboy
     
    158, 26th May, 2017
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  3. wylie

    wylie Moderator Staff Member

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    Depends on so many things, and each answer will be different because each person's circumstances are different.

    For me, I would either pay off our debts or sit it against our debts to improve our cashflow.

    Or I'd look at putting what I could into super.
     
    wylie, 26th May, 2017
    #3
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  4. Ace in the Hole

    Ace in the Hole Well-Known Member

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    He only said 1 mil, there will be nothing left to waste.
     
    Ace in the Hole, 26th May, 2017
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  5. Gavin Ng

    Gavin Ng Well-Known Member

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    Gen y or x? :D
     
    Gavin Ng, 26th May, 2017
    #5
  6. hammer

    hammer Well-Known Member

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    step 1 = Pay off PPOR

    step 2 = Go on a cracking holiday

    Get a deposit for an IP.

    step 3 = get some advice on structure then buy a bunch of LICs and ETF's with the leftovers...

    Then get back to work....
     
    hammer, 26th May, 2017
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  7. Ed Barton

    Ed Barton Well-Known Member

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    Buy a boat, pay for a wedding and buy some more scratchie tickets.
     
    Ed Barton, 26th May, 2017
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  8. wombat777

    wombat777 Well-Known Member

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    Pay off the PPOR, deposit for a development, invest the rest in shares.
     
    wombat777, 26th May, 2017
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  9. Joshwaaaa

    Joshwaaaa Well-Known Member

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    pay off ppor including doing the planned KDR we want to do
    buy that boat I've been telling myself I will buy "one day" for the last 16 years

    probably still have $400-500k left over so would have to think long and hard about the rest but would be invested somewhere somehow
     
    Joshwaaaa, 26th May, 2017
    #9
  10. willair

    willair Well-Known Member Premium Member

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    Buy a new set of JBL'S speakers for the P-C turn up the music ,then open a commsec account and have the appearance of inconsistency..

     
    willair, 26th May, 2017
    #10
  11. pjames

    pjames Well-Known Member

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    click my name and select send pm, I will respond with a time and date to pick you up in a limo with a nice brand new briefcase, a bottle of champagne and a few other things.

    if I was to do something more serious then it would just be spreading the money in various investments from property, shares, high interest accounts and business investments.
     
    pjames, 26th May, 2017
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  12. datto

    datto Well-Known Member

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    Just throw it straight in the bank and keep working hard as if nothing has happened.

    Review the situation after 6 months when the haze has cleared.
     
    datto, 26th May, 2017
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  13. datto

    datto Well-Known Member

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    So fish hooks for a spot of fishing.

    Some Coca-Cola.

    Tooheys New?
     
    datto, 26th May, 2017
    #13
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  14. Perthguy

    Perthguy Well-Known Member

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    My answer is very boring sorry. I would pay @Terry_w to set up a discretionary trust with a company beneficiary of the discretionary trust. I would be director and shareholder of the company. I would loan the discretionary trust the $1,000,000 and use the funds to buy 4 LICs split roughly $250k each. @Terry_w would have to show me how it all works, but basically the dividends flow to the company, building up franking credits. When I am ready to start drawing down I can take $95,000 pa and pay no tax (assuming no other income). I don't understand how to reinvest the dividends so the amount of shares in the trust compounds over time but I am prepared to spend the cash to find out! ;)

    Tax Tip 147: How to Earn $95,000 pa and pay No Tax
     
    Perthguy, 26th May, 2017
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  15. wylie

    wylie Moderator Staff Member

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    I like this answer @Perthguy. I don't understand LICs and I haven't had time to read the very loooooong thread to even start.

    But I'd love to know how LICs sit in the risk categories compared to other investments.
     
    wylie, 26th May, 2017
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  16. Perthguy

    Perthguy Well-Known Member

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    For me, relatively low risk, moderate return.
     
    Perthguy, 26th May, 2017
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  17. wylie

    wylie Moderator Staff Member

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    Thanks @Perthguy. If I have $350k to put into my superannuation or to put into an LIC, is the LIC similar to putting it into superannuation.

    At present, my super is earning FYTD half balance (diversified growth) at 9.7% and half (aggressive) at 12.6%.

    Over the past five years this was 7.75% and 8.50%.

    I wonder if I'm better to stick with what I have and add to it. I'm not looking for financial advice, but I'd be trying to learn about LICs and the risks and benefits over what I already understand reasonably well with my super account.

    We could place some or all of our super into pension mode and draw minimum 4% per year to provide an income stream, and hopefully the underlying asset would continue to grow.

    What benefit do LICs have over super? Are they just shares held in another type of account? Are they just as risky as having a spread of shares within superannuation? Just as risky as if I choose some shares directly?

    I will read the thread and will be asking our accountant about this but firstly I'll read the LIC thread to try to wrap my head around it.
     
    wylie, 26th May, 2017
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  18. Perthguy

    Perthguy Well-Known Member

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    Personally I don't think that an LIC would return this much. If you were going to invest the money through super, you would need to seek professional advice about contribution caps.

    In my case, the income from LICs can be accessed now, whereas I won't be able to access the income from super for 20 years.

    So, if I was to invest the $1 million through super, I would not be able to retire for 20 years. If I was to invest the $1 million in LICs with the proper structure, I could retire in 5 years if I wanted to (because of my other investments).

    All things being equal, you would be getting a higher return through super and a more tax effective structure. That said, there is the $1.6 million cap for super balances to consider (to maintain that level of tax effectiveness).

    It's not straightforward and depends on how old you are as to which will be more effective.

    Hope this helps.
     
    Perthguy, 26th May, 2017
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  19. chylld

    chylld Well-Known Member

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    debt recycle -> VAS, VGAD, WHF, ARG -> retire :)
     
    chylld, 26th May, 2017
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  20. neK

    neK Well-Known Member

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    Buy my 5 mums a mustang each
    Have 5 dream weddings with each of my 5 brides
    And buy 5 boats.
     
    neK, 26th May, 2017
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