Financial Investment Question

[Sadaiyappan]

Hi, my father was hit by a drunk driver and was killed. My mother got a lot of money in life insurance. She is 58. What is the best way to invest her money?

 

[Cogman]

Hookers and blow

 

[TuxDave]

Is she depending on this money to survive and therefore risk tolerance is very low? Probably just set up a life/term annuity account with some financial institution to make sure she will have a steady flow of money.

 

[darkxshade]

Please translate "a lot" into a numerical value and then maybe we can give you a more informed sarcastic answer.

 

[nickbits]

Bonds or low risk assets. Too old to be in stocks IMHO.

 

[Sadaiyappan]

She is going to be collecting his pension, he was a state engineer. So she is not dependent on the money.

 

[Printer Bandit]

sorry about your dad.

 

[AtlantaBob]

I'm sorry to hear that. I would go and see a fee-based financial adviser (e.g. they charge you by the hour or a flat fee, like a lawyer would) and they don't have any commissions or anything that would make them steer your mom towards a particular investment that wouldn't be right for her. You didn't say what "a lot" is, but I imagine that an up-front investment of $1,500 - $2,000 or less for an adviser wouldn't make a big dent in it.

The adviser would probably suggest a mix of some conservative investments (possibly bonds (although they have been very variable lately), dividend-paying stocks, and annuities) and some growth investments (regular stock mutual funds) as well as something in cash/money markets. A good financial adviser will apply general principals to your mom's unique situation (e.g. her perspectives on risk, growth, etc.).

Of course, it should go without saying that she should pay down debt (if any), especially credit cards, and perhaps her mortgage.

You might want to check on Dave Ramsey's website for his Endorsed Local Providers -- I've had some family members go to folks he recommends, and they were pretty happy.

Good luck.

 

[Jassi]

Sorry to hear about your father. I don't have the answer for you but you shouldn't rely on message boards for direct advice on investments. I will echo AtlantaBob and suggest that your family consult a professional. Also, be really careful of scammers. There are people that prey on people going through such tough times, especially since people are more likely to make mistakes if they are still recovering emotionally.

 

[kranky]

Condolences on your dad's passing.

AtlantaBob gave good advice. Your mom needs a financial advisor. The important thing is not to make any significant financial moves until she has met with the advisor.

The advisor will ask your mom what her goals are, what amount of risk she is comfortable with, and what her income needs are before working up a plan. That's because everyone has different needs and goals.

 

[speg]

Bonds, or maybe a pool of dividend paying stocks. Perhaps a combination of both.

 

[edro]

Verizon Wireless!!!

 

[Sclamoz]

drugs

 

[ModerateRepZero]

definitely check with a professional, preferably a licensed financial advisor.

 

[glenn1]

definitely check with a professional, preferably a licensed financial advisor.

Actually, going to just any old "financial advisor" isn't sufficient, you want to go to a Certified Financial Planner instead. The CFP has a fiduciary duty to their clients, whereas only the "suitability" standard applies to most FAs. You want to ensure that the person you hire to watch over your mother's money has solely her interests in mind, not his or his firm's.

 

[Zebo]

Land - they aint making anymore of it and it's cheap right now.

Personally I'd buy O&G properties at auction in Houston but you have to do major due diligence.

 

[Zebo]

Actually, going to just any old "financial advisor" isn't sufficient, you want to go to a Certified Financial Planner instead. The CFP has a fiduciary duty to their clients, whereas only the "suitability" standard applies to most FAs. You want to ensure that the person you hire to watch over your mother's money has solely her interests in mind, not his or his firm's.

This is best to do if you don't feel comfortable investing which is obvious by OPs query.

 

[Regs]

Land - they aint making anymore of it and it's cheap right now.

Personally I'd buy O&G properties at auction in Houston but you have to do major due diligence.

Hire an attorney for a grand per property?

 

[mshan]

I agree with what AtlantaBob says, but there is also no substitute for learning the basics of personal finance and mutual fund investing for yourself:

http://www.amazon.com/Personal-Finan...ecc_rvi_cart_1

http://www.amazon.com/Investing-Dummies-Fifth-Eric-Tyson/dp/0470289651/ref=ntt_at_ep_dpt_1

There also should be no rush to rashly invest all the money at once. You can put it in a quality money market fund (e. g. Vanguard Prime Portfolio), and dollar cost average increments of all the money to be invested over time.

I would also interview at least 3 different financial advisors to see what they say and also to become a better judge of the character, skill, and experience, of the financial advisor you eventually choose.

 

[JS80]

http://www.fatwallet.com/forums/finance/

 

[iGas]

IMHO, short term low risk bonds is a good choice at the moment because the market is very unstable. There are high dividend yield stocks & funds that produce 5~10% return per annum, however they are too risky at the moment, and your mom is nearing retirement age therefore it is not wise to have a high risk portfolio.

Best bet is to seek information from your financial institution/s.

Good luck!

 

[Hacp]

Treasury and CDs.

 

[iGas]

Actually, going to just any old "financial advisor" isn't sufficient, you want to go to a Certified Financial Planner instead. The CFP has a fiduciary duty to their clients, whereas only the "suitability" standard applies to most FAs. You want to ensure that the person you hire to watch over your mother's money has solely her interests in mind, not his or his firm's.

Canada law makers are trying to change all of that because most if not all FP only cares about their own bottom line.

 

[NinjaTech]

Hookers and blow

LMAO ...classic Troll.

...I KNOW I shouldn't encourage them!

 

[tokie]

Is she looking to build up an account for other people to inherit, or does she want short-term returns so she can spend the money?

If short term, just put it in a high interest savings account.

If long term, look for some solid corporate/country bond issues. I saw some recent ones by very stable companies going for 6% interest, which is decent when the stock market is a crapshoot like it is now.