Turboslacker
Recycles dryer sheets
- Joined
- Jan 3, 2014
- Messages
- 277
Help others spontaneously and meaningfully
Sent from my iPad using Early Retirement Forum
Sent from my iPad using Early Retirement Forum
Today we received a windfall lump sum of approx. 650k. This represents a roughly 12% boost to our investible assets.
We've been retired 2 years and are currently 45 and 44. Our current WR before the lump sum is about 3.25% and this provides enough for our lifestyle.
We're wondering if we should just plow it into our portfolio or if we should do something special with it. So my question to all of you is, what would you do with a windfall that represented 12% of YOUR portfolio (not necessarily what should we do with ours though that is welcome too!)?
If all of the millionaires on this forum departed, you'd hear nothing but echos and questions going unanswered effectively from all the millionaire wannabees.I don't understand. If you have this much money why are you even messing around on this forum? How could you ever run out of money? Just askin...
You have received similar thoughts from others. I would select a non-profit and provide them a guaranteed stream of funds, $15k+ per year , for 3 to 5 years which you will generate in a very low risk investment. Select a non-profit program that is meaningful to you. And, take the time to not only to provide the funds but invest your time, supporting the use of the funds. Capital type investments allow you to clearly see your funds at work. Paying for programs also works as long as the money goes to programs vs. overhead. Your personal involvement will help direct the program funds.
The OP indicated they were likely to trigger the AMT which would hit their ability to take a fully tax deductible deduction on his Sch D/AMT form.If the windfall would push my estate into taxable territory, I would probably get rid of it to what I felt was a deserving person(s) or cause.
I'm debating with this same thought right now. It goes against my nature to pay that much extra for a slightly more comfortable seat and better food. On the other hand, it wouldn't change anything else in my lifestyle. My grandkids just inherit a little less.First, I would never again fly less than business class. That's a big deal in my book.
I'm debating with this same thought right now. It goes against my nature to pay that much extra for a slightly more comfortable seat and better food. On the other hand, it wouldn't change anything else in my lifestyle. My grandkids just inherit a little less.
The OP indicated they were likely to trigger the AMT which would hit their ability to take a fully tax deductible deduction on his Sch D/AMT form.
I've become very cynical about a number of charities I used to have a high opinion of. An even cursory look at their finances can show a high percentage of their budget going to fund raising and administration fees. People hear "non-profit" and just naturally think of dedicated people working to further their mission. Unfortunately, that's not the case in many situations.
So my recommendation to OP is if you're going to have some fun with the money or give it away, it's better to do it earlier rather than later, because once you get used to see that bigger number on the spreadsheet, you will be reluctant to see the number go down.
One thing I noticed about getting a windfall is how quickly one gets used to the new "number". It's similar to getting a raise---you might be happy for a few weeks, but before long you mentally adjust to that new number and that becomes the baseline.
It's the same thing with getting a windfall. It took me about a year to get used to the idea of having the extra money, but once I mentally adjusted to the new "baseline" number, I became much more reluctant to do much of the planned spending that I thought I would do with this extra money. In other words, the LBYM mentality kicks in.
So my recommendation to OP is if you're going to have some fun with the money or give it away, it's better to do it earlier rather than later, because once you get used to see that bigger number on the spreadsheet, you will be reluctant to see the number go down.
I actually increased my frugality because it made things more real and less fantasy... This increased frugality also helped move the ER date closer since it drove my spending numbers down...
Rather than spending the $$ we ended up saving more.
In the case of excess funds, music therapy/palliative care, is an area of interest I would explore. I have not been to a film this year, but am anticipating the arrival of Alive Inside at local theaters.Thanks to all for the great ideas and interesting comments! Keep them coming!
In my case - getting a windfall (inheritance) moved my ER date closer by about 2 years. It was added to my nest egg and allowed me to reach the goal sooner. I actually increased my frugality because it made things more real and less fantasy... This increased frugality also helped move the ER date closer since it drove my spending numbers down...
Rather than spending the $$ we ended up saving more.