Just got a life insurance settlement, need a good investment plan

Ezra it sounds like your in a great position
definetly dont refi your house
keep Reading your books but it will only get you so far
Join a prop firm find someone smart and learn through hands on exp
go slow dont put all your eggs into it leave your self some room to fail a few times.
You never know you might find trading more of a learning experience then school.
Take a break from school give trading a year if it doesnt work out you still got 100 grand left and can continue on with school.
 
Quote from Ezra Fitch:

I'm in my late twenties and am finishing up college and then going to grad school. I received a life insurance settlement, and after buying a car, a townhome for $185k and paying off debts I have about $175k left. I don't know anything about investing but have been reading every book I can get my hands on. At first I thought it would be best to invest for income doing a 65% bonds, 20% money market, 15% stocks, in order to help with living expenses until I finish school, while preserving my capital, and then when I start working, change my investment portfolio to accumulate growth. However, many people told me I should set aside money for living expenses and tuition for the next few years (which would be at least 75k) and invest the 100k right now for growth. Others say I should do that, but refinance on the house and add that to the investment. What would you do?
More...


since you have at least 3 years of higher education ahead of you, I would suggest you concentrate on that. Before you do anything foolish, park the money in the CD for a year. With current 5.25% rate you should get around $9,000 at the end of the year, which translates to around $750 a month. That amount should help you live a financial stress free life while in college. Repeat this scenario for the next 3 years, finish your MA and then if you enjoy learninggo go for PhD ( ths way if nothing else, you could require people in your workplace to address you "doctor"). If not then try to invest the money for a higher than CD rates. You are a young fella, enjoy your college years, concentrate on your studies. Have fun! You are only young once! :D :D :D
 
You're not going to retire wealthy at all with 60% in bonds. The bond market will be shit for the next 5-10 years in my opinion. I say go for 60% stocks and 40% in money market or some kind of dividend paying instruments. Try earning 15% or more a year by picking either select stocks or high quality mutual funds with decent track records. For the most part, the average advisor you find is going to park your money for you in some mediocre funds or money market, so I would avoid them like the plague.

You could try to max out a 401k of your own choosing for tax purposes so you dont get taxed as much. So I suggest keeping a job or finding a part time job so you can save up your earnings tax free and parlay that into an early retirement.

Think freedom 40. (I assume you are late 20s)
 
Quote from Ezra Fitch:

I'm in my late twenties and am finishing up college and then going to grad school. I recieved a life insurance settlement, and after buying a car, a townhome for $185k and paying off debts I have about $175k left. I don't know anything about investing but have been reading every book I can get my hands on. At first I thought it would be best to invest for income doing a 65% bonds, 20% money market, 15% stocks, in order to help with living expenses until I finish school, while preserving my capital, and then when I start working, change my investment portfolio to accumulate growth. However, many people told me I should set aside money for living expenses and tuition for the next few years (which would be at least 75k) and invest the 100k right now for growth. Others say I should do that, but refinance on the house and add that to the investment. What would you do?
More...

STAY AWAY FROM LEVERAGED TRADING. YOU CAN LOSE YOUR MONEY QUITE FAST. LISTEN TO NO ONE WHO ENCOURAGES THIS. FEW WILL EVER MAKE MONEY DOING THIS.
 
Good plan you have.

Why not forget grad school for now and focus on getting a job with a reputable trading firm.

If your living expenses are so scaled down, you can probably live on that interest for a long time.

Use this as a fantastic opportunity. Many, if not all, of the traders on this site (and many who are not ) would love to have the ability to learn how to trade in this scenario.

Or, do whatever else you want with your life. You will have achieved what true wealthy people have done: living offthe interest. Regardless of if your living on the slight, it's still freedom and the ability to make choices.

Spend your excess time learning how to make more money. Then you can increase your lifestyle, become a philanthropist, or whatever your choose.

My suggestion for trading is that I believe it has the most income potential over the longest period of time.
 
You must log in or register to reply here.
Back
Top