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7,000 Shares of Apple… WWYD

Apple Shares
Apple Shares

If you inherited 7,000 shares of Apple, what would you do?

This is a question A user on Reddit asked the community when he recently inherited 7,000 shares of Apple from his grandfather. Check out the MarketWatch article. Before diving into this post, I would like to express my sincere condolences for the original poster. I would also warn any of my readers before looking up the original Reddit post as there is some strong language in the original post and subsequent comments.

Apple is currently sitting at $498.90 a share. Inheriting 7,000 shares gives him a value of $3,492,300. That’s definitely something to work with. This Reddit user get’s many suggestions and comments on what he should do with his newly found riches. Let me share what I would do if I came into this type of inheritance.

What do I do with these shares?

First, I would cash out most of it except for about $250k (roughly 501 shares). I would keep this large sum as Apple is still a great company and a dominant force in the Tech industry. Since this is inheritance, I should only be taxed on what I’ve gained since inheriting the shares. This means I will pay very minimal taxes if the value goes up before selling it.

After the sale, I would have around $3.25 million. The name of the game is diversity. Spread the wealth. I would put at least $250k-$500k into a few high yield savings accounts as a safety net.

Investing at least $1.5 million in real estate (rental properties) would be my next move. This money would be used for several down payments on single family, multi-family and commercial properties. I would take out mortgages and leverage my debt service to the income I would make from the rental units.

I would invest the last $1-1.5 million in the stock market. Investing mostly in blue chip dividend paying stocks, index funds, and maybe a few REITs. I will already have a bunch of real estate, so maybe no REITs and just other dividend paying stocks.

Related: 6 Ways to Invest in Real Estate

Here is the income I would have just by letting my money work for me.

Having $500k in the savings account you are making roughly $10,000 a year from a 2% rate.

If you do well with your real estate investments and manage your debt service well, you can get around a 25% return. This would be between $250k – $375k a year.

And with that last $1.5 million, let’s say you are averaging a 5% dividend yield, that will give you another $75k a year.

Conclusion

With investing your money properly, you can make close to $460k a year to let that money work for you. I would donate at least 10% of my earnings per year so roughly $46k. As I’ve said on my podcast, I believe it’s important to give back. This is what I would do personally as you don’t want to have all of your eggs in one basket.

Sound off in the comments and let me know what you would do if you inherited 7,000 shares of Apple.

Mike Cavaggioni
Mike Cavaggioni

Mike Cavaggioni is an Active Duty Officer in the U.S. Navy, Real Estate Agent, and Real Estate Investor located in Honolulu, HI. He is the founder of Average Joe Finances and host of the Average Joe Finances Podcast. He is the CEO and founder of Compass REI Properties, LLC; a rental property company in Virginia. Mike owns real estate in Hawaii and Virginia and is building a community for people to come together to learn and build their wealth.

2 thoughts on “7,000 Shares of Apple… WWYD

  1. I know exactly what I would do because something similar actually happened to me. I inherited a seven figure portfolio that had a large chunk of Walmart stock in it. I sold every share immediately, I don’t believe in stock picking. Was it smart? My diversified portfolio has basically matched Walmart with much less risk, so I think it was.

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