Throwaway for anonymity reasons.
TLDR: I'm 39 years old, married, with 2 middle school age kids. About to have $15MM in cash and want to invest it and live off the interest until I die. What should I do?
Full story: After graduating from college (2002), I went to work at the company my father founded in the 80s. In 2014, my father informed me he was retiring and gave me the option to purchase the company using a seller promissory note. I bought the company from him and have been making my monthly payments to him since then.
After taking over, I've increased sales, bought out competitors, improved efficiency and have tripled EBITDA. Personally, I've paid off my personal home mortgage and put all my savings and dividends into a Vanguard Target Index Fund and two 529 plans for my kids' college.
Earlier this month, I received an offer from a PE firm that would allow me to pay off what's left of my father's note and all the other debt owed. After paying everyone and capital gains taxes, I would net about $15MM. Even though I'm young to retire, I've decided to sell and live off the interest generated by that lump sum. Assuming a 4% interest and 50% fed+state income tax rate on the interest income, I would net $300K/year, more than enough to support a very comfortable lifestyle for me and my family.
So my questions:
- What am I failing to consider in this entire plan? Where are my blind spots?
- What fixed income options should I be researching? I'm thinking AAA bonds or tax free munis. Are there other options that can give me what I'm looking for?
Submitted November 27, 2019 at 08:11PM by throwitaway09878 https://ift.tt/2sgY3XI
