where to invest a couple million

Discussion in 'Hangar Talk' started by FORANE, Feb 22, 2021 at 4:19 PM.

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  1. texasclouds

    texasclouds Cleared for Takeoff

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    Reopen Globe Swift manufacturing, give POA members the original aircraft pricing.
     
  2. Ted

    Ted The pilot formerly known as Twin Engine Ted

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    As the OP has noted, real estate is having issues for him since it's gotten harder to evict people who don't pay rent. Plus you have a physical asset and if it turns out your renters use the place as a meth lab (happened to friends of mine) then that can really cause you problems.

    Starting a business? Well, that involves a lot of risk, not to mention a lot of work (BTDT... more than once). It would work for your phase of life (young, single adult), but that doesn't necessarily go well with retirement.

    Of course, stocks and other investments have all kinds of other risks associated. But a diversified portfolio with a good advisor would be how I'd go.
     
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  3. steingar

    steingar Taxi to Parking

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    How much are the indigent tenants costing? How does that compare to the loss to capital gains? Unless the OP buys more rental units, but then you have the same issues all over again. I think the OP is making a huge mistake, letting his emotions get the best of him vis a vis money.
     
  4. ja_user

    ja_user Pattern Altitude

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    First thing I'd do, is ask a bunch of pilots ;)
     
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  5. Ted

    Ted The pilot formerly known as Twin Engine Ted

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    Yeah, in reading through the advice on here I see some good advice, and a lot of advice from people who clearly have no idea WTF they're talking about.
     
  6. TCABM

    TCABM Pattern Altitude

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    Self storage place. Build, don’t buy.
     
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  7. Checkout_my_Six

    Checkout_my_Six Touchdown! Greaser!

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    But, He could make a small fortune in aviation.....starting with a large one. lol ;)
     
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  8. PaulS

    PaulS Touchdown! Greaser!

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    Bitcoin, only half kidding, I would put some in and now is a good time, it's down right now, but no more than you can afford to lose.

    Real estate is a great investment, but I can certainly see the downside of owning apartments now. It's a perfect storm against the landlord right now, and it's not going to get better soon. Getting deadbeats out is pretty much impossible plus I imagine some great tenants are having issues also. So cash flow has to be bad. Of course while cash flow is down, there is no relief from taxes and other bills. If the OP has the sale then I would probably go for it.

    There are ways to stay in real estate via REITs there are some good ones out there.

    I agree with Ted here, starting a business is a great dream, but it is a vortex, especially if it is successful, and can easily suck you into servitude toward the business. The more successful the business, the more difficult it becomes to extract yourself from it. Definitely not something to delve into if you want to retire, unless it's a hobby type business like repairing watches or shoveling snow occasionally.

    I second finding a good advisor and building a diversified portfolio. And bitcoin, lol, you have to do that yourself.
     
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  9. Ted

    Ted The pilot formerly known as Twin Engine Ted

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    The more I think about starting a business, the harder it is for me to convince myself it would be a good idea. I'd work more than I currently do and have a lot more stress and responsibility all for maybe making more money, maybe making less, maybe losing it all. Hard for me to convince myself that's worth investing $1M in (not that I'm in that position anyway) vs. some kind of other investment that I may lose, but at least I don't have to work on every day.
     
  10. Checkout_my_Six

    Checkout_my_Six Touchdown! Greaser!

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    ya but.....everything is on sale today. :D
     
  11. jsstevens

    jsstevens Final Approach PoA Supporter

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    Can you honestly think of any threads on here that statement wouldn't apply to?
     
  12. Ted

    Ted The pilot formerly known as Twin Engine Ted

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    You speak the truth, my friend.
     
  13. NealRomeoGolf

    NealRomeoGolf Pattern Altitude

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    High dividend stock and enjoy the quarterly payments. There are investing services that will help you find different ones to pick so you get a monthly check. I have two 7.5% dividend stocks that I enjoy the quarterly check from. Easy money.
     
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  14. PaulS

    PaulS Touchdown! Greaser!

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    It can be tough unless you have something like the next facebook, or tesla and can fund it. Your kids are still pretty young from what I can tell, give it a few years, maybe one will get the entrepreneurial bug (along with a good idea) then you can partner with them, they work, you fund and share in the profits.

    My son has the bug, and he has a bunch of good ideas, the problem is he is in a job in SF where they are paying him so much it's not worth the risk to leave. I think in about 5 years he'll be set and venture off.
     
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  15. Ted

    Ted The pilot formerly known as Twin Engine Ted

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    I certainly see that happening. My son is very interested and has lots of ideas. We'll see.
     
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  16. catmandu

    catmandu Cleared for Takeoff PoA Supporter

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    Not slow, young. Pop culture reference from the days of cellulose acetate.

     
  17. NealRomeoGolf

    NealRomeoGolf Pattern Altitude

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    Let me know when you need a flying CFO. :D
     
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  18. FORANE

    FORANE En-Route

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    My commercial re broker always said never buy a self storage and never build a laundromat.
    Too much work either way.
     
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  19. NealRomeoGolf

    NealRomeoGolf Pattern Altitude

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    Which is why you instead buy EXR and let them do the work. Unfortunately their massive growth has slowed. If you invested 10 years ago you'd be a happy camper.
     
  20. steingar

    steingar Taxi to Parking

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    I've been a landlord in the past. Have you?

    All that's happened is the OP's costs have gone up a bit. My guess is functionally they haven't gone up much, it's always been tough to get rid of deadbeat tenants. I could be wrong, I suspect the 'rona has made a lot more deadbeat tenants, though I can hardly blame the tenants for their vagrancy. Even if that impinges costs more, it is temporary in nature and likely to affect the whole rental industry. There are now lots of low wage earners out of work, and they aren't easily dislodged. So if the OP sells out his apartments he's going to face the same problem no matter where he goes.

    Were he just looking to retire the hit from capital gains might be worth it to get the money out, but that doesn't seem to be the case from what he wrote. I'd ride out the bad times, but I'm not in the biz.
     
    Last edited: Feb 23, 2021 at 12:16 PM
  21. Half Fast

    Half Fast Final Approach

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    Stop being so conventional. Be different from the masses.

    Matthew chapter 19:

    21 Jesus said to him, “If you want to be perfect, go, sell what you have and give to the poor, and you will have treasure in heaven; and come, follow Me.”
     
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  22. steingar

    steingar Taxi to Parking

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    Jesus was obviously not a landlord.
     
  23. FORANE

    FORANE En-Route

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    We've had that experience as well. I'll say that being a licensed certified meth cleaner is lucrative. it cost us around 5k for one afternoon of his work. At the time there were only about 13 guys licensed to do it in all of Tennessee.
     
  24. Ted

    Ted The pilot formerly known as Twin Engine Ted

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    In the case of our friends, it was bad enough that they had to strip out most of the interior of the house. It was a lot of work, they lost a bunch of money that they could never get back.
     
  25. RyanB

    RyanB Administrator Management Council Member PoA Supporter

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    Yes! My BIL owns a few of these. A very good investment!
     
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  26. FORANE

    FORANE En-Route

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    And insurance won't cover it either...
     
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  27. weilke

    weilke Touchdown! Greaser!

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    Other apartments. Commercial properties. Farmland. Owned as a shareholder in a larger entity. Turn X apartments in socialist wonderland into into Y% of a multi-family development in some place with contract laws.
     
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  28. 455 Bravo Uniform

    455 Bravo Uniform En-Route

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    On the real-estate theme, if you like the cash flow - 1031 into more real-estate, consider higher end condos or student housing (yeah, they get heavy wear, but parents co-sign and you can rent for 9-10 months for full 12 month in some places).

    My best rentals were nicer homes 4/2.5/2 with cheaper than market rents that incentivized the renter to stay for years, pay on time, and essentially leave me alone. Low turnover, low vacancy, lower expenses and hassle. Severe background checks and selectivity a must.
     
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  29. weilke

    weilke Touchdown! Greaser!

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    The other end of the spectrum are concrete block section 8 multi-family units. Tiled and linoleum floors with the most basic appliances the agency allows. Painted washable walls, no laundry. Government pays the rent on time. Must-have is a manager and a handyman in between you and the tenants who only deal with some nondescriptly named LLCs as recipient of the checks.
     
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  30. bflynn

    bflynn Final Approach

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    Defense contractors, initially.

    If anyone has too much money, I'd like to see someone produce a certificated, all aluminum version of the long EZ.
     
  31. PaulS

    PaulS Touchdown! Greaser!

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    What makes you think he was talking about you?
     
  32. FORANE

    FORANE En-Route

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    We have had this almost exactly. One of the best changes we made was to non-renew the mod-rehab contracts with housing. Housing tenants didn't have any deposit to speak of, and the damage to the units was significant. Also housing paid rates below market.
     
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  33. wsuffa

    wsuffa Touchdown! Greaser!

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    It's gotten harde and harder to start one, and the government is still so used to traditional employment that I don't expect it to get any better soon. And yes, I work with a lot of entrepreneurs.
     
  34. Checkout_my_Six

    Checkout_my_Six Touchdown! Greaser!

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  35. optionizerSS

    optionizerSS Pre-Flight

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    I like the self storage idea. Considered building one on property that I sold last year.

    But as far as 10-20% on stocks? A few good mutual funds should get you at least 10%. The way the market has been 20% isn't that hard. But yeah there are risks. I got about 35% on mine last year. I have it split up into about 4 or 5 different funds but mine are a little on the aggressive side. You could get into something with a little less risk and should still be able to get 10%. Call a few brokers. Schwab, TD Ameritrade, etc. Call them and see what they offer. They have managed accounts that they will set up and manage or you can manage it yourself. My daughter is a financial advisor for Northwest Mutual. This is the kind of stuff she does. You would call her and get ideas then let them manage your accounts. Not saying to call my daughter but find someone local to you and talk to them.
     
  36. Ted

    Ted The pilot formerly known as Twin Engine Ted

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    If I were going to start another business, it would probably be a one-man operation, and probably just something I enjoy doing. Opening an auto repair/upgrade/customizing shop comes to mind.
     
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  37. ktup-flyer

    ktup-flyer En-Route

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    Buy a nursing home. No shortage of old people
     
  38. wsuffa

    wsuffa Touchdown! Greaser!

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    Or a funeral home. No shortage of people dying to get in.
     
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  39. MuseChaser

    MuseChaser Pattern Altitude

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    There is in NYS now....
     
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  40. Daleandee

    Daleandee Line Up and Wait

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    Have you never read - (John 14.2)?
     
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