Actually, her ROI was about 20,000% given she spent $100 on tix. You can extract the equity as you need the cash and make more with the cash. You'd also come out ahead as your borrowing would be tax destructible. Using cash isn't. Tell me what's not overvalued and I will Not necessarily put it all in the one company but I'd happily dump it all in VASGX and/or QVE.
If this lady had no income than best would be to get gold and sell it all, to fund her life. However if she earns average income than keeping the house and using the equity for negative gearing or other investments would be the best course of action. End of the day who have heard of someone (other than SELLER) who have majority of their assets in gold and become rich? People like to believe the world is collapsing around them, but that is wishful thinking, people have being saying that before WW1, the depression, WW2, the Cold War, the gfc. In fact people have being proclaiming the end of the world as we know it since the before the Babylonians. I'm not saying gold is a bad investment, I currently hold gold but it's a tiny percentage. In fact saying to someone even if it is not someone we know, have most of your asset in gold is like saying have all your assets in bitcoins, Tesla or Apple inc. it's is silly This just my pint of view
We have been in this Gold and silver game together for nearly 6-7 year here (just in SS, some maybe longer) and the return on these is not even worth to mentioned at all..... my humble 2c
RSL Art Union ticket buyer here (changed after Boystown went to "Your Town", ie boys muscled out by equalists, or more likely feminists who can't organise a Girlstown) Anyway... RSL Art Union real estate valuation seems very high FWIW. It is a good proxy of the RE market though. Most times, the choice is between a spacious SE Qld property and a sardine can in middle ring Sydney or Melbourne, eg Rozelle or Camberwell. Very recently this too has changed. The Qld property for the last few lotteries is an apartment or multiple apartments, mostly on the GC - the last on Kirra Beach. Yes - a 3br apartment for 2 million kangaroo dollars. Also, the prize includes retail priced furniture and presumably the price of the interior design consultant(s). Bullion on the other hand is single issue and fungible. Is the spread smaller? My guess is yes for bullion. A question. Is it better to take the 2 million in gold, sell it and then buy RE? Probably yes, given the RSL Art Union valuer calculations for the RE in their raffles. Bottom line, RSL Art Union proceeds go to veterans and they publish examples. That is tops imo.
Easy, you take the bullion/cash (does she actually get bullion?) and buy 5 x $400k apartments. Or 3-4 properties and have some spending money. Having all your $2M ties up in one apartment is not a smart move. And if you go to sell it you will immediately get hit with various fees to do so.
Yep, you'd be a fool to take the apartment and have all your eggs in that one basket. And good luck changing your mind in a years time and finding someone with $2M willing to buy it. Take the cash (which gold basically is) and buy several properties if that's what you want. And I doubt they'd actually physically hand her $2M in gold bullion, it's most likely a $2M gold account at Perth Mint or some other repository. Would be trivial to convert into cash at any time. Imagine if you had $2M in cash right now, would you but that one $2M apartment? Of course you wouldn't. Take the cash! Having said that, many people are utterly clueless with managing their money. It's likely to be just frittered and diluted away. Especially if you have 6 kids, and if some are independent age, she might be very tempted to "help them out", and bingo the money will be gone in short order.
You guys really are short of a few quid up-stairs! You keep thinking that cash and houses are assets. Water, trees and good soil produce long term assets especially if what you buy is a ...long way from a capital city. Buy arable land with permanent water, grow fruit trees and vines when you are young and reap the reward wehen this world turns to shite. Buy land that will grow Walnut trees! Have you looked at the land in war zones? Capital cities suck! Sure...make a few bucks on a hot market but for the long term invest in land that has permanent water on it. If you have water you can "Grow" soil! If you don't have water you have a nothing.
We live in the real world, not some Mad Max prepper fantasy land. If that's what you want to do though then more power to you.
Either choice suck cause they don't answer the key issue... diversification. So take the gold, keep 10% gold, convert 20% to silver, buy a $700k apartment to rent out, buy some good defensive blue chip shares, keep some cash handy for expenses, take a holiday and buy some premium champagne.
I actually know one of their daughters really well, so I can provide a follow up if they are okay with me discussing it. Honestly, the family are rather wealthy even though they have only the 1 income. I'd say they have some rather solid financial advisors already and they'll either take the house and sell it after next summer or something, or they'll take the bullion and immediately liquidate most of it. I do agree with the arable land suggestion. Not in a pepper sense, but it is going to be in short supply in the next 10 years. Buy something on the NSW-VIC border area, or somewhere fairly south and just lease the land for now.
$75K for 2Mill is a pathetic return. Taking the house would loose commission fees when selling it. So I would take the gold , sell it and buy 10 x $200K properties here in Hobart, Tasmania, giving you roughly $150K per annum in rent. Yes you have to minus the rates etc, but they are all tax deductable. What an income for the rest of your life.
I'd take the gold wait a bit longer till it goes higher then sell most of it, buy property or properties elsewhere, where the prices aren't exhorbitant. Rent them out. Hold on to the rest of the gold