The Money Mustache Community
Learning, Sharing, and Teaching => Ask a Mustachian => Topic started by: Freddie on June 24, 2017, 08:48:26 AM
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Anyone want to share what he/she would do with 2000 shares of XOM held directly (i.e., not in a qualified account), assuming you'd like to have the money aid the transition from full-time work to part-time work? Options, obviously, include (1) hold for now (dividends = approx. $1,500 per quarter), (2) use the money to buy other "traditional" investments, and (3) use the money to buy rental property or aid the purchase of a business or side-hustle. There would be some capital gains tax upon sale, but nothing too dramatic. I know the person's particular circumstances (most of which are not provided here) impact the decision, but I'd like to know what the board would do. Thanks a lot.
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It would depend on just how big the capital gains were and what percentage of my portfolio it was. If under 5%, I'd just hold the shares. If above that, I'd diversify into VTI, VIG, or VWELX
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Personally, I'd be selling them tomorrow. When the money settles, I'd transfer it to my checking account, send in $6500 to Fidelity to fund my Roth for the year and then use the rest for the kids' tuition payments.
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Given the uncertainty with the energy and oil out there, I would sell them immediately.
As a matter of fact, I did just that back in December. I had around 200 shares of XOM that were gifted to me back in the mid-90s. I sold them around $90/share, and the money has been happily growing as VTSAX while XOM declined by $10/share.
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...assuming you'd like to have the money aid the transition from full-time work to part-time work?
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There would be some capital gains tax upon sale, but nothing too dramatic.
If by "aid" you mean "pay essentially all expenses not covered by part-time work until a Roth pipeline starts producing or age 59.5 happens", and
if by "nothing too dramatic" you mean less than $10K capital gain on the ~$164000 gross proceeds, then
I'd sell it all and put the money into something very safe, e.g., one of The Best Online Savings Accounts in June 2017 (http://www.magnifymoney.com/blog/earning-interest/best-online-savings-accounts275921001).
If you meant something else, please advise....