Ask HN: New to having wealth, how to protect my assets? | Hacker News Reader

Ask HN: New to having wealth, how to protect my assets?

11 pointsSmithalicious13 comments

In the past year I did a short stint doing contracting in the cryptocurrency sector and ended up with what to me is quite a lot of liquid assets (~$50k at the moment though some of that is earmarked for taxes). The current economic climate being what it is, I really don't want to keep that money sitting around (especially not denominated in euros - I'm an EU citizen), but I'm in my mid 20s and have no experience with investing.

How do I manage my money in such a way that I have piece of mind? I won't ask for investment advice directly since people are (understandably) reluctant to give it and taking investment advice from strangers on the internet is (understandably) considered a poor idea, but some leads to get started doing my own research would be very helpful, as this is kind of stressing me out.

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1. Figure out exactly how much you will need to pay in taxes. Set that aside and don't touch it at all. Tax problems are never helpful.

2. Your money should not be sitting around, that you have correct. However, you should take a holistic view of "investment". You need to find what will deliver the highest ROI for you in the near future. I am not convinced that stocks/financial assets are that for a mid 20s person in Europe. Maybe you seriously need to buy a new computer? Maybe you have some sort of surgery you were putting off and can now do? These things take priority over buying some stocks.

3. Building from point 2, if you can earn 50k in a short stint, you have some serious skill/knowledge about some industry(unless you got very lucky). The best thing for you to do is figure out how to make those 50k work for you in your area of expertise, where you have an actual edge. Maybe you know what is the next great shitcoin? Who knows, point is that the last thing you should do is lazily chug those 50k in an etf and let the market do the work.

Figure out what is it that you wanna use the money for.

If you don’t have a home, might be handy to use that as a downpayment. You’ll get some returns from property appreciation over time (though there’s always a chance property prices will go down).

If you don’t have emergency savings that give you enough runway in case you lose your main source of income, consider a low-interest savings account and put enough in there to make you comfortable you can survive (enough to cover 3/6/12 months of living expenses- up to you to figure that out). you’ll have to accept inflation will eat it away, but such is the life in europe. There’s no real financial instrument with good yield and low risk around here.

If you got all that covered, no debts, no short term plans to buy property, I would dollar cost average into some form of investment (e.g. etfs).

IMO DCA is a good strategy right now because the markets are fluctuating a lot and it looks very likely there will be a global recession. You get to take advantage of falling prices to push your avg price down.

Something like buying 1-2k per week should work well, but mind broker fees

Random advice from the internet.

Investing is based on risk and reward.

Risk is the opposite of protection.

Reward is the result of opportunity.

Opportunities are the result of patience.

If you don't know how to invest, don't invest.

Wait for an opportunity you understand.

Good luck.

Addendum: $50k is a lot of money when it is yours. It is not enough to seriously invest using strategies that work for $50million. A person can live comfortably on very safe 1% returns from a $50million vineyard.

I personally am putting my savings, assets etc into Funds. As a Swiss citizen, lot of banks here are offering Funds investing. Some of these funds are index following funds, which I personally consider the lesser evil of all investments. This will not make you richer, but has a good potential to keep you out of trouble and definitely less riskier as stocks or other instruments. So take a look what your bank offers as funds investment opportunities.

Not exactly financial advice, but do you want to stay in Europe ?

If not, that money would be perfect to start a new life elsewhere.

Where can 50k buy you citizenship?

Why would citizenship be required to move to a different country ? I've lived in half a dozen legally in three different continents without ever being a citizen in any of them.

The primary motivations for having a secondary citizenship is reducing your exposure to political risks and giving yourself visa free access to more countries. For example, traveling with a Russian passport is more challenging now than it was before the invasion of Ukraine. Some countries limit issuing visas to Russian citizens. A Russian traveling with a non-Russian passport will have a less frustrating experience in some places.

Not an expert, just sharing some information I’ve seen around on the subject. Do your own research.

I don't understand why this explanation is given to me. I don't need to do any research, I have dual citizenship, plus an EU passport. I am unfortunately an expert in needing a way to get out of "your country" if things in your own country are or become awful.

And citizenship has nothing to do with moving to another country, again. People move to work, to study, to pursue a relationship, and they get a visa to do so, then residency, THEN if wanted or needed, shoot for citizenship.

I was wondering if OP was not happy in Europe, then why not use that money to move elsewhere, I'd consider that an investment, if not a literal one. I wish I had had 50k in my twenties to do it.

Did you get the idea that I'm not happy in Europe? If you did, I'm not sure why, as I am quite happy here - I just don't feel comfortable having large amounts of money sitting around denominated in Euros, as the value of the Euro is rapidly depreciating.

Got it, not happy with the currency at present, nothing to do with the place itself. Disregard my suggestion ! ( And thanks for clarifying. )

Let's say I'm a developer with an EU passport and would like to live and work in a non-EU country, how do I do it? I assume need to find an employer that is happy to sponsor me a work visa (which is a headache for them and makes me less competitive over a local applicant)?

There are all kinds of visas in all kinds of non-EU countries, and all kinds of jobs.

Yes, you do it by researching, finding if there is an employer looking for your profile, a digital nomad program, making friends and contacts during a temporary stay and generally doing everything people do to move to another country -- and most people do it without an enormous comfortable cushion of 50k, without any help at all. The world is big and vast and beautiful and horrible, but certainly there is life outside the EU bubble.

Edit : Not to mention, someone who can make 50k in a "short stint" in their twenties seems like someone an employer anywhere would want.

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