Returns on $100 000 Investment

[Raptorsin7]

What kind of returns can one expect if they have $100 000 of disposable income to invest? And how would you invest the money?

Is there a dramatic difference in having 100k vs 500k to invest?

[puporing]

What do you want to do with it? 

What do you want to create? 

What is meaningful to you?

What would you have wanted to do with 100k when you didn't have 100k?

[Raptorsin7]

1 minute ago, puporing said:

What do you want to do with it? 

What do you want to create? 

What is meaningful to you?

What would you have wanted to do with 100k when you didn't have 100k?

I want to use it to establish a passive income source. Maybe buy a cheap house and rent it or something lie that.

Right now I want to get out of my parents house and travel and go experience some life. I feel like a child and I think going to travel, visit temples/retreats, and just get out and do whatever I want will help me grow up.

[Yarco]

A few thousand dollars a year, not enough to live off of. For the next couple years you might not even earn that in the stock market.

Leveraging it as a down payment and getting a mortgage on a house to rent would probably be best. But you're not going to travel the world and also be a good landlord, especially as a beginner. What happens if your tenant doesn't pay or their toilet breaks and you're in Thailand? And there probably isn't enough margin between the mortgage and the rent you charge to hire a property management company and have any reasonable amount of profit left over. If you're a lazy landlord you're gonna get fucked. Especially if you're lazy when evaluating tenants, but also if you don't have the foresight to save money for replacing big items like furnaces or roofs every 5 - 10 years.

Being a landlord isn't an easy passive income source. It's creating a part time job for yourself.

3 hours ago, Raptorsin7 said:

Is there a dramatic difference in having 100k vs 500k to invest?

Yes a 400% difference  What kind of question is this. You mean in terms of quality of life?

If all it took was 100k in savings to live off passive income, EVERYONE would be retired. Unless you mean 100k of disposable income every year.

Earn your first 100k and then you can worry about how to use it to be lazy. Earning 100k will help you grow up.

Edited June 15, 2022 by Yarco

[Asayake]

I would say, don't invest it all into stocks/crypto. It will be very difficult to make a passive income you can live off of with a 100k investment. Only way to make a quick buck pretty much is trading, but it is more or less gambling. You are playing vs super skilled traders and trading bots. It's literally like trying to win as a noob vs challenger players on League of Legends. If you go into that sort of investing, only do it with small money first or it's likely you'll regret it. It is tempting to invest a lot of money because it seems like a quick way to financial freedom and a solution to a lot of problems. But it is not so easy, actually it's very fucking hard.. 

I think traveling is a really good idea, it won't cost you 100k and it will give you experiences that take you outside of your comfort zone and teaches you a lot about yourself. If you ever visit Europe I would recommend passing by The Budapest Bubble hostel in Budapest. It's a great hostel, best one I lived in during my travels through Europe(Budapest, Prague, Berlin, Amsterdam, Paris). The owner is a super friendly girl named Anna. It has a very welcoming vibe and feels more like living at a friends place rather than a hostel. You can meet other travelers there, most people are pretty open and friendly. And you can get a lot of good tips on things to do in the city from the staff. One day I came home to the hostel in the middle of the night and was so drunk that I passed out vomiting on the toilet. I woke up on a bench with a pillow and a blanket covering me. Someone in the staff had picked me up and put me down in a comfortable sleeping position with a pillow under my head and a blanket over me. That's the vibe of that hostel . Budapest is also a ridiculously beautiful city with a lot of things to see and do. My favorite city I've ever visited together with Amsterdam.

If you live in hostels in Europe and travel by train between the countries you could probably get away with 3k or so for 3 weeks of travel. Those 3k will be a well worth investment. After I came home from my 3 week Europe trip I took the big step and moved away from my parents home. A year later I had a career. I don't want to credit it all to the travels but the travels definitely helped me get out of my comfort zone and open myself up to life, I became a bit more yolo after that and just went for it. That energy didn't last forever but it lasted long enough to have a positive impact on my life.

If you don't want to travel maybe you could buy a tent and some hiking gear and go on an occasional hike alone in nature. I haven't done that but I could imagine that would be a worthwhile investment too, and even cheaper than traveling.

Edited June 15, 2022 by Asayake

[Raptorsin7]

@Asayake Yeah here's what I'm thinking.

I'm going to plan a few retreats in the next few months. Probably a vipassana retreat and maybe some other monasteries that are in BC. 

I'm thinking that a multi detox in a retreat will change my mood and perspective dramatically so then I can figure out my next step from there.

If I don't have a clear plan after the retreats then the next step will be to plan a long vacation, probably through Asia because it's cheaper. I think I have like 10k in savings and I can probably get too like 20-30k in the next few months so hopefully that can last me a year of comfortable travelling.

Then after this I will hopefully get a better sense of what I want to do.

If I had a real investment plan I could probably get anywhere from 100 to 500k from my family to pursue some venture. But i think in my current state I would lose all the money.

[Asayake]

9 minutes ago, Raptorsin7 said:

@Asayake Yeah here's what I'm thinking.

I'm going to plan a few retreats in the next few months. Probably a vipassana retreat and maybe some other monasteries that are in BC. 

I'm thinking that a multi detox in a retreat will change my mood and perspective dramatically so then I can figure out my next step from there.

If I don't have a clear plan after the retreats then the next step will be to plan a long vacation, probably through Asia because it's cheaper. I think I have like 10k in savings and I can probably get too like 20-30k in the next few months so hopefully that can last me a year of comfortable travelling.

Then after this I will hopefully get a better sense of what I want to do.

If I had a real investment plan I could probably get anywhere from 100 to 500k from my family to pursue some venture. But i think in my current state I would lose all the money.

Sounds like an awesome plan man. Even 10k will probably get you very far in Asia, but saving as much as you can before the trip is probably a good idea anyways. I haven't been to Asia myself but I want to go there too at some point. Just the high quality fruit available there makes going there worth in my opinion .. Swedish fruit can kiss my ass!

I'm also looking into vipassana retreats, I was planning to go on a 10 day retreat here now in June but it was full booked for months so I'm waiting to end of summer/beginning of autumn to make it happen now. I think it's an important next step for me as well.

Safe future travels!

[Consept]

Yeah definitely not crypto ?

I think for the investment, property is your best bet just because of the leverage, so if you have 100k you could put down a deposit and make income plus any rise in equity on an asset that is worth 400k while only paying a couple percent on the loan. If you compare that with investing in stock, you'll only get profit on what you directly have, so if you have 100k and it goes up 5% you got 105k but the property could go up the same and then you've got 420k plus rental income.

But there are pros and cons, for example property is very illiquid, meaning its hard to get money out once it's in. Also it's not completely passive you have to look after tenants. (Airbnb could work a little better though). Stock market investment doesn't have these issues. 

My advice though would be to really research property investment, find out what a good deal would look like, look at locations, types of mortgages etc. Once you feel relatively confident you'll want to pull the trigger. The travelling is a great idea in general, I think it might be better to work out the investment situation before you travel though, just so you've got income that can cover it rather than just saving and spending that. Esp if youre family is willing to help you with it. Just to double up on the point - fo your research!

[puporing]

6 hours ago, Consept said:

But there are pros and cons, for example property is very illiquid, meaning its hard to get money out once it's in. Also it's not completely passive you have to look after tenants. (Airbnb could work a little better though). Stock market investment doesn't have these issues. 

Yes, though Airbnb is way more work if you do the short-term stuff and you need someone to be available at all times, unless you got a solid partner who can help you with logistical things when you want to take some time away. 

For travelling lifestyle long and medium term periodic tenants are way better you just need more properties to make any good income from it, and possibly involving a management company or a trusted partner.

Edited June 16, 2022 by puporing

[BipolarGrowth]

Using $100k in the right market along with the BRRRR (Buy, Rehab, Rent, Refinance, Repeat) method of real estate investing could do a lot. My business partner and I bought and renovated our first place for about $55,000 in early 2018. We invested another $20-30k of our own money up until now, but any other costs were covered by using part of the rent to do renovations on new properties. Now we have about $200,000-$250,000 of property with a bit over $4,000 in gross rent coming in each month which will go up as soon as someone moves out as rents have increased here by quite a bit. We have about $80,000 in mortgages right now and roughly $30k cash in the bank. The mortgage cost is only about $550/mo. 
 

Getting started with $100k in other markets might not be the easiest or scale as well just because property values might be much higher creating a more significant barrier to entry. I live and invest in Indiana, USA. The small portion of our profit that I take out each month is enough to pay my entire mortgage on my personal residence. Depending on the market, it might be best to buy a 2-4 unit building and live in it while renting the other units out. This would likely at least cover your costs if not generate profit while giving you your own place away from your parents. This is how a lot of people have compounded their wealth very quickly just starting off. 

[puporing]

@BipolarGrowth LOL thanks for sharing that. I've heard of stories like that here too, someone starting with not much and leapfrogging with refinancing as they go lawl.  

Yeah the market you're in dictates alot of this (not being already overinflated and low-ish vacancy rate).