Best way to utilize money received after business purchase?

Question

I am nearing a transaction for the sale of my business and would like to know some good ideas as to how I should invest at least 65% of it in personal investments.

What are some good websites as to how to learn about Roth IRA, stocks, cds, bonds, etc? I would like to invest some of that 65% into stocks, and I've heard that you should do at least an hour of research on each stock you purchase per week. Is that a good idea?

Any general finance informational website and/or forum/messageboard link would be great.

Answer 1

I too sold my business and have done well investing the proceeds. One of my favorite sources of information regarding stocks is thestreet.com and all of Jim Cramer's books. The subscription to "Tomorrow's News Today" included with my Scottrade account is also very useful.
Peter Lynch's "Beating the Street" is still relevant and strangely "deja-vu-ish" even though it was published in 1992.

To really learn about and understand the full spectrum of investments available and have a general reference, get a copy of "Investments" by Bodie, Kane, and Marcus, it's a college textbook and well worth the $75-$100 through amazon.com.

As far as the one hour rule regarding your stocks. Absolutely good advice and listen to the conference calls.

You may want to consider playing the "Beat The Street" game on the street.com to practice with if you're not familiar with stocks. There's no risk and if you're fortunate you might even win some money. I've come to believe that buy and hold is for suckers, trading stocks is how money is made in the stock market. This game is a good way to test your skills.

For the conservative part of my portfolio I have a Money Market account with ING. The rate of return has been good, it's safe, and I still have access to cash if I really need it.

One of the most intriguing areas that I have invested in is a site called Prosper.com which has consistently performed better than any of my other investment categories, except my home in Hawaii. It's a very cool idea where you can make microloans in increments as little as $50. By spreading your money around you are mitigating losses if a few default.

It's been my experience that anyone that has offered to manage my money for me has not made me any more and usually has performed worse than I have on my own once their fees have been factored in.

Good Luck!

Answer 2

USA answer: First, see if some of the business sale transaction can be turned into a like kind exchnage for the stocks you are interested in. For instance, if you own a coffee shop, part of the purchase price could be shares of Starbucks. That MAY qualify as a like-kind exchange and then you avoid some capital gains tax. This will involve a consultation with an accountant (which should be free).
Next, the secret to stock market success is to get in and not mess around with it (trade, time markets, etc.). Picks some mutual funds that have a lot of stocks in firms you like based on what you think their long term potential is. Put as much as you are willing to lose in stocks and the rest in bonds. You aren't likely to lose in the stock market, but it is a good measure of your risk aversion.
At this point, you can worry about what tax shelter you want - and discuss it with the accountant.

Answer 3

First of all, let me tell you something that is not going to make a lot of sense at first (and maybe never). It is not particularly important which stocks and bonds you buy. What is important is how much money you have in stocks vs. bonds at any given time. What this means for you is that your first priority is to figure out what percentages of your proceeds should be invested in stocks, bonds, and other asset classes. Financial professionals call this "the asset allocation decision".

With that in mind, you should see a financial planner in your area. Look for a "fee-only" planner ("fee-only" means that the planner does not earn commissions on sales of financial products as "commission-only" and "fees-and-commissions" planners do). Here's a good place to start searching:

http://www.cfpboard.org/search/

The planner will be able to recommend (in writing) an asset allocation appropriate for your situation and suggest (again, in writing) some mutual or exchange-traded funds for you to buy. Expect to pay a few hundred dollars for a couple of hours spent with the planner and the preparation of your personal investment policy. You will find that this is in most cases money well spent.

Answer 4

you are able to no longer earn a private income, it has to flow to a pair chritable or non-income corporation. you are able to set up your guy or woman non-income and it is legal to maintain proceeds for earnings and working fees yet you do would desire to income something with it.