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Message
1
Posted on 8/25/15 at 12:44 pm to bbap
I'll take the 5 mil now.
No guarantees in life, so i sure as shite am not going to trust someone to continue to give me a little over a million a year for 5 years.
No guarantees in life, so i sure as shite am not going to trust someone to continue to give me a little over a million a year for 5 years.
Posted on 8/25/15 at 12:44 pm to Phil A Sheo
quote:How?
Would be able to double or triple that in 5 years
Posted on 8/25/15 at 12:44 pm to Random LSU Hero
quote:
5 now and let me build it up to more than 7.5
And just how would you do this ?
You would be more likely to turn 5 Million into 3
Posted on 8/25/15 at 12:44 pm to Phil A Sheo
You guys should start a hedge fund with those bold statements.
Posted on 8/25/15 at 12:46 pm to bbap
I'd take the $7.5... I could easily live comfortably off of $100K and invest the other $1.4M each year... in the end I have $7M working for me to live comfortably... could I turn that into a retirement sum? Absolutely.
Posted on 8/25/15 at 12:46 pm to The Mick
That's a close call. My rough math says that with an initial investment of 5 million to reach 7.5 million after 5 years you would need about 8.5% annual return.
Of course if you were taking 7.5 over time you would also be investing that making the return needed on the 5 million option to be even greater than 8.5 just to keep pace, making the 7.5 look more and more like the better option unless you think you could beat a pretty ambitious annual return.
On the flip side there is the assurance that you get all 5 million if you take it now. If you spread it out you could be dead and not ever get it.
I'm relatively young, I might actually take the 7.5 million over 5 years. If it was spread out much longer, I think I would take the 5 million though.
Of course if you were taking 7.5 over time you would also be investing that making the return needed on the 5 million option to be even greater than 8.5 just to keep pace, making the 7.5 look more and more like the better option unless you think you could beat a pretty ambitious annual return.
On the flip side there is the assurance that you get all 5 million if you take it now. If you spread it out you could be dead and not ever get it.
I'm relatively young, I might actually take the 7.5 million over 5 years. If it was spread out much longer, I think I would take the 5 million though.
This post was edited on 8/25/15 at 12:49 pm
Posted on 8/25/15 at 12:47 pm to The Mick
Tax-free?
The present value of $7.5 million spread out over 5 years with a 8% discount rate is $6.24M. Even with a 20% discount rate, the PV is still $4.988M.
I assumed a payment of $1.25M today, then $1.25M every year for the next 5 years.
The present value of $7.5 million spread out over 5 years with a 8% discount rate is $6.24M. Even with a 20% discount rate, the PV is still $4.988M.
I assumed a payment of $1.25M today, then $1.25M every year for the next 5 years.
Posted on 8/25/15 at 12:47 pm to TeddyPadillac
quote:
I'll take the 5 mil now.
No guarantees in life, so i sure as shite am not going to trust someone to continue to give me a little over a million a year for 5 years.
That's the only logical reason for taking the 5. I'd be nervous about actually seeing that 7.5 in it's entirety as well.
Posted on 8/25/15 at 12:47 pm to The Mick
Present value of $7.5 million in 5 years is more than $5 million today.
Only uncertainty is tax policy.
Only uncertainty is tax policy.
Posted on 8/25/15 at 12:47 pm to TeddyPadillac
quote:
No guarantees in life
I love that in his hypothetical, the pretend $5M is guaranteed, but the pretend $7.5M is too risky.
This post was edited on 8/25/15 at 12:48 pm
Posted on 8/25/15 at 12:48 pm to Phil A Sheo
This post was edited on 8/25/15 at 12:51 pm
Posted on 8/25/15 at 12:48 pm to Jakesonaplane
quote:
5 now and let me build it up to more than 7.5
always love this response
Typically made by someone wanting to sound smarter than everyone else, but really has no idea how he'd actually go about doing this.
TAX FREE MUNICIPAL BONDS
This post was edited on 8/25/15 at 12:49 pm
Posted on 8/25/15 at 12:49 pm to slackster
nm... misunderstood you
This post was edited on 8/25/15 at 12:50 pm
Posted on 8/25/15 at 12:51 pm to The Mick
quote:
$5 MILL in one check today
Nothing is guaranteed in life, including tomorrow.
Posted on 8/25/15 at 12:51 pm to The Mick
5 now
Posted on 8/25/15 at 12:53 pm to TheAlmightySmash
quote:
Do you mind investing my 401(k) for me then?
I will. Give me access to all your accounts and power of attorney.
Posted on 8/25/15 at 12:53 pm to The Mick
normally I would say 7.5 over five years but I may consider the 5 million immediately right now. I only say that because there is a good bit of potential for some serious buying opportunities in the stock market depending on how this "correction" goes.
Posted on 8/25/15 at 12:53 pm to jrodLSUke
quote:
A potential 50% return on investment would be good enough all by itself. A guaranteed return like that should not even be debated.
Taxes on capital gains over a certain amount are almost certainly going to skyrocket after the next election if a lib gets elected so that is the main reason I would take it now.
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