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Author: kahunacfa Big funky green star, 20000 posts Top Favorite Fools Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 15349  
Subject: Re: Just sold home, all that's left of net worth Date: 5/16/2012 12:36 AM
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Hello Fools!

I bought my house with cash from the proceeds from the sale of my last business so there was no mortgage on the property. This is all I have left of my liquidity and want to make the right decision for what to do with it. Can I get everyones opinion here as to how/what to do with the money? Are there any Financial Planners or Financial Advisors in this forum? I'd love to hear your two cents as well.

As this is all I have left after spending the millions before it, I really don't want to screw this up.

This is my plan:

(1) Take the proceeds from the sale of my home, lets say it was $1,000,000 and take 50% of it and take an aggressive investment approach of investing 75% in stocks and 25% in bonds/short-term assets. This would be my retirement account. I am 33 and plan to retire at 55. I'd probably also throw 10% of it in an Index Fund like the S&P 500.

(2) Take the other 50% and keep it liquid by putting it in a high-yield short-term asset account like a Money Market.

(3) Live off my income and pretend the money isn't there

Any advice? On top of it, I'm a new investor so I'm trying learn over night as I go since the money is already sitting in my account.
- alissaknight | Date: 5/14/2012 12:47:34 AM | Number: 15265

First-of-all: 1. I am an experienced investor, an investment professional from 1974 - present. 2. I have never managed individual investor's funds except my own.

Consider: 1. Buying shares of companies that pay good dividends and which have dividend yields of at least 3% or more. Most of the large Pharmaceutical companies fit that mold as do many "Blue-Chip Industrial companies such as Emmerson Electric, Honeywell, 3M Corporation, Hospital Corporation of America and almost all telephone and electric utility companies. 2. Invest or consider investing with a low cost high quality Fund company such as the Vanguard Family of Funds: http://www.Vanguard.com. 3. Do NOT buy all at once. 4. Educate yourself about investments. Read: 1.The Intelligent Investor by Benjurmin Graham, 2. One-Up On Wall Street by Peter Lynch, 3. Do NOT make any investment that you do not fully understand before you buy it. 4. Consider subscribing to one of TMF's Premium Services such as "Rule Your Retirement" or "Stock Advisor". 5. In order to be properly diversified, you should own about 10 - 15 different companies in different industries. Look for Investment Clubs in your area. You might be able to find them through: http://www.BetterInvesting.org. There they also have a good magazine the features a stock and company to study each month in their magazine.

Most of all go slow, learn, be conservative and consider Fee Only Investment Advisors, if you decide you want to or need to hire one.

Kahuna, CFA
Investment Professional
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