# You've got $100,000 What do you do next?



## Mike Finley (Apr 28, 2004)

Okay, it's the end of the first quarter 2008. You look at your books and you have $100,000 net profit. It's sitting in your bank account, cold hard cash...

... what would you do with it?


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## john elliott (Oct 23, 2005)

Stay in the home improvement business until it was all gone.

John


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## TimelessQuality (Sep 23, 2007)

john elliott said:


> Stay in the home improvement business until it was all gone.
> 
> John


:laughing::laughing:


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## buildenterprise (Dec 4, 2007)

At this point I would restructure as an LLC, hire a capable foreman and helper, and devote most of my time to selling. As it is right now, I do it all so I don't have the time to market myself as much as I should.

Thanks for getting me thinking, I need to make some changes around here.....


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## Joasis (Mar 28, 2006)

There are still some speculative building projects here that would work...so I know what I would do with it. Carry it over and loose it in taxes and inflation.


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## JonM (Nov 1, 2007)

Buy a second tank full of gasoline....:clap:


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## Bone Saw (Feb 13, 2006)

install grab bars in your rentals, then buy a hybrid


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## mickeyco (May 13, 2006)

Send it to MickeyCo Charities.

New estimating motorcycle for the "company",







business trips and stuff like that.




.


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## ruskent (Jun 20, 2005)

Man i guess there is money in bathrooms!!!


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## Mike Finley (Apr 28, 2004)

john elliott said:


> Stay in the home improvement business until it was all gone.
> 
> John


:laughing: That's funny, that reminds me of the old saying that the best way to make a small fortune in business -- is to start with a large one. 

Okay, so a couple would reinvest in the business. I think it's really good that those who say they would reinvest into the business know exactly what they would do. I've always had the problem of it seems when I don't have the money I know exactly what I would do if I had it, and then when I do have it, it's almost impossible to actually figure out exactly where to spend it to best advantage. I know where I want to end up, the problem I have is all the decisions along the way.

So you have $25K, $50K, 100K... some of the choices I could think of --

Give yourself a raise?
Give employees a raise?
Hire a secretary/receptionist/bookkeeper.. etc..?
Restructure and reorganize?
Reduce debt?
Take spend it on yourself and your family?
Spend it on more advertising that you already do?
Spend it on new advertising to see what works?
Buy a new truck or a couple?
Buy more tools?
Expand into another related line of work?
Hire more people or a whole nother crew?
Just sit back and take a breather knowing you've got time to breathe now?
Hire an accountant finally?
Take some time off?
Put some aside for a rainy day fund for the company?
Finally get a professional website or update your existing one?
Get your paperwork in order, hire an attorney?

and of course a company estimating motorcycle :thumbup:

What else?


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## MAD Renovations (Nov 18, 2007)

Just a thought but why not just keep doing what you have been doing to here.... The money will always take care of itself and now it will be there when those unexpected things come up..... Not knowing what to do with profit is a nice problem to have..... I would just forget about and keep going. When the time comes you will know what to do with it.

Cheers


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## rbsremodeling (Nov 12, 2007)

Mike

Not sure of your set up, I would take some money and buy a commercial building for my operation instead of renting. Commercial buildings here are worth a fortune. Nice retirement assest to have in 20-30 years?

Use some of the space for my showroom and rent the rest of the building out and have revenue coming.

Second thing would be some more advertising. TV ads and some local talk shows maybe sponser your own radio segment.


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## Bill (Mar 30, 2006)

Me? I would have to say I have someone elses books!


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## mickeyco (May 13, 2006)

If you don't have a shop or own your shop, buy one or build one, make sure it's not in a TIF district, lots of land, building only as big as needed for tax purposes, preferably in an area that will increase in value long term, send remaining money to MickeyCo Charities. 


.


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## Mike Finley (Apr 28, 2004)

I certainly have to agree with getting your own building and owning it. Nothing I can think of that would pay off better in every single way then that. Problem out here is that's a million dollar or more investment.

I'm looking at getting some warehouse/storage space, even thinking of buying one of these you own it storage "condos". If you have never seen them, they are sort of like this : http://www.garagetown.com/

I just cringe at paying rent if you can own.


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## ruskent (Jun 20, 2005)

I would invest in my companies infrastructure: building, secertary, managers.

I think what makes owning a small business so hard is that you always need more people, equipment etc to get to the next level. But often, you can not afford those things until you are at the next level.


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## Joasis (Mar 28, 2006)

I would build rentals, or rehab for the "loft" style apartments. Real estate here is still strong, and not going down, so new construction would be my only option, if I had the extra cash, which I do not after last year's weather.


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## ChillaWatt (Apr 2, 2006)

Good question. Lots of factors to consider though. Your age, are you married, children? Do you have a stock portfolio? How investment savy are you? Are you risky, I would think so, your in the construction business.

Several people have mentioned investing in your own business. Real estate is usually the smartest investment, for the small business owner, especially come tax time. I know we're talking about real estate as an asset to your business, but I have to mention a bit on real estate in regards to the recent mortgage implosion. It's funny to see everyone selling their houses off because of the decline in property values, etc. They act as if our economy has never been cyclical, and that the market will never change. Well, it always changes and it always comes back strong. We saw it in the late 70s-early 80s, we saw it in the early 90s, and we're seeing it now; although I'm still waiting for it to recover.  Today it's a buyer's market. We have, in California(NorCal at least) guided tours of foreclosed houses. Where you can drink wine while you travel to listed foreclosures, house-hunting, in an SUV limo. What a way to spend your Sunday. 

Back on point, if you don't already have one, start a Roth IRA. It's also good for taxes, but it has it's limits. US Treasury bonds are one of the safest investments, even today with our de-valued dollar. If you wanna invest in the stock market excellent choices are gold and natural resources like oil and gas...ofcourse. Ever hear of the 28 day T-bill? Paying around 5% today.

I recently heard news that I was inheriting a windfall of money from some Nigerian prince...millions. Just have to reply with my social, bank account and routing numbers.

Chilla


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## Fence & Deck (Jan 23, 2006)

Pay down debt accumulated from a brutal winter


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## njcarp (Apr 16, 2007)

Start building in Canada...They have a strong dollar right now


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## J F (Dec 3, 2005)

I don't know...send it to me and I'll come up with something

If this is your situation, I applaud you...I respect the hell out of you from what I've read here over the last couple of years, it's no surprise if you've done well.

J


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## BrianHay (Jun 17, 2007)

Pay off the Hoe and if there were anything left after that an estimating motorcycle sounds good :thumbup:


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## mickeyco (May 13, 2006)

BrianHay said:


> Pay off the Hoe and if there were anything left after that an estimating motorcycle sounds good :thumbup:


After seeing BrianHay's post I'm reminded of the Spyder Hoe, don't know what they cost, but get one, they're really cool. You could use it to clean snow off your driveway and deck, I'm sure it has a few other applications as well. I want one for my rear deck, it'd fit right between the buildings, then hop the fence then its no more deck shoveling for me.

.


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## ruskent (Jun 20, 2005)

BrianHay said:


> Pay off the Hoe and if there were anything left after that an estimating motorcycle sounds good :thumbup:



I think we knew there would be atleast one person spending the money on a ho!:laughing:


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## BattleRidge (Feb 9, 2008)

Start some trading? That much would fetch you 4 grand a quarter in divideds with GE right now....Or I would just build a 4 plex, that will get you an even better return. Actually I would build something bigger then a 4 plex. And probably put it aside for taxes or something, but building your own rental properties is a good way to start making some good residual. Thats my plan. Build a 4 plex, spend about 250k on it but my return will be near 3600 a month.


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## BrianHay (Jun 17, 2007)

I love my Hoe and so do my friends. They love her long shapely legs and the strange positions she can get into, I even let them ride her once in a while. It takes a lot of lube to keep her going but it's worth it :laughing: :jester:


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## vinylguy (Mar 18, 2006)

i would really think and research on how i could make that money earn me money. investmest or maybe something as simple as a high yield cd!


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## Susan Betz (Feb 21, 2007)

vinylguy said:


> i would really think and research on how i could make that money earn me money. investmest or maybe something as simple as a high yield cd!


You can get a corporate account at a brokerage firm, if you're incorporated. It's a better place to park your cash than a checking account. Think ScotTrade or ETrade, something where the commissions don't completely deflate any financial gain. You can do 30-day CDs if you've got a cushion that month, and the buy is in increments of $1000, not the $10K or $25K the banks want for a high-yield account on longer terms.


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## Sir Mixalot (Jan 6, 2008)

Pay off anything that you are paying intrest on. :thumbsup:


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## send_it_all (Apr 10, 2007)

Create, or add to the I.R.A.....The account, not the group.


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## plazaman (Apr 17, 2005)

downpayment on rental property. id wouldnt invest too much in residential. in my opinion, theres only so far you can go with residential.


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## ruskent (Jun 20, 2005)

Two words: Vegas and Blackjack! I figure it I have a 100k net profit in the bank, someone made a mistake! So I better hit the tables before the luck runs out!


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## MattCoops (Apr 7, 2006)

If I had $100k I'd do my best to turn it into $5million: 
How to turn $100,000 into $5,000,000
I'm a capitalist pig!


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## Kent Whitten (Mar 24, 2006)

Sir Mixalot said:


> Pay off anything that you are paying interest on. :thumbsup:


I second that.

That's not enough money for me to retire to Mexico yet. Buy your own building...I don't know, I've got enough crap I don't use as it is. I'd have a bigger building full of crap.


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## mikec (Jan 2, 2007)

I'd come on here and in a subtle way say " ha ha suckers i made 100k net this quarter":whistling


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## BMAN (Aug 21, 2006)

I would get a shop and a sexratary for sure!


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## WarnerConstInc. (Jan 30, 2008)

buy one of everything from the new Festool Catalouge. Lots of hookers, and maybe uhhhhh Divorce... Just dont tell her about the loot. Invest invest invest, come up with a new product and get Billy Mays to sell it on tv for you.


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## ChillaWatt (Apr 2, 2006)

Everyone wants to be a comedian today :laughing:

Seriously, if you donate to a charity it's 100% tax deductible. And there's plenty of eager charities in this thread. :laughing:


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## Ed the Roofer (Dec 12, 2006)

Well, only because of the tax consequences caming up, here is what I would do if it were my excess funds. I would, without hesitation, donate them to my buddy Mike Finley.

On the flipside, if the shoe were on the other foot,

I am sure he would reciprocate likewise to Ed The Roofer.

Ed





P.S. J/K

With the down market in housing right now, I would get one or two underpriced properties and see them double the investment in 5 years or less.

Ed


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## wallmaxx (Jun 18, 2007)

Call Dave Ramsey and ask for advise. I like his straight talk...cash is KING!!


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## Danno6102 (May 31, 2007)

Pay off my trailer & buy a truck that can actually pull it. 

If I had employees, a nice bonus to them would be awesome! I am my only employee so I guess a bonus to me would be pretty awesome too! All about giving back. After all, those employees are the ones who helped you get that $100,000 in the bank.


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## Double-A (Jul 3, 2006)

I think the thing to do is to make sure all the bases you think are covered are covered.
Three months of liquid capital reserves.
 Pay down any debt.
 Three more months of invested capital reserves.
 Establish retirement accounts/programs for employees.
 Establish/reestablish/grow the business's credit line.
 Grow the business's profit center via training, tools, software, consulting, etc.
 Establish educational endowment fund for employees/spouses/children.
Once those things are taken care of then I start looking outside the company for opportunities.
 Seek charitable association with local community organizations.
 Endow a local little league team or an after school program.
 Endow a local community college's vocational/technical department for business education.
I've sorta ranked these in order of importance, but this is personal preference once the business bases are covered.


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## Mike Finley (Apr 28, 2004)

How come nobody said - lower my prices?


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## mdshunk (Mar 13, 2005)

I didn't' read all the responses, but I say 100K ain't squat, and you need to hold onto it for the lean times to get you through. Hopefully there will be no lean times, but you need capital reserves, for sure. The money doesn't necessarily need to stay as cash, but needs to be placed in some manner that it's easy to draw from or use as collateral for business credit on short notice.


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## SelfContract (Dec 6, 2007)

Let's see. Gas goes from $3 to $4 in a year, a bag of flour from $10 up to $30, gallon of milk from $2 to $4, etc... so *$100K this year = $50K* of last *yester-years*!

Nah, not enough to survive today, not yet any savings tomorrow either!:shutup:


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## Pearce Services (Nov 21, 2005)

I would take a small portion of the money to invest in education.

I would do what ever is needed to get CAPS designation, and promote that in any and all future advertising.

I would send some guys to Schluter School, or host in house training from vendors.

Kevin


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## rch (Aug 21, 2007)

This is actually a pretty easy one...

1. If you don't own a home, buy one. If you have a home mortgage, get rid of it. Lower personal expense = Lower Required Bottom Line = Lower Business Pressure = Better Business Decisions / Lower Prices to get a larger Market Share + Higher pofits through volume. ***DO NOT use it to remove the operating costs of your business. DO NOT raise yoru business operating expense. Your personal comes first, then the business will inherit the benefits...NOT the other way around IN THIS ECONOMY. Right now, cost of living is often highr than cost of doing business given real estate & food costs.

2. If you don't have a mortgage, DIVERSIFY. NOT in the same business! No real Estate, No equipment. What you have now and what you are doing now...works. It produced a healthy net profit. It ain't broke so don't fix it!
invest in another industry. Take it and buy a Subway or similar food franchise...jutt get a good location in a busy town/city. Run it as an absentee owner and net $40-50K a year on your investment. Monitor it via Internet, cash register & video...no big deal...done all the time. Include someone already in that business as a partner. Offer them 5-7% in exchange for education/guidance. When it is successful, you will be bought out at a handsome profit by another franchise owner who will want your location.

If both 1 & 2 don't interest you, then put in in the bank and do nothing. Doing nothing is the safest thing you can do with cash. You will sleep very well knowing that it is there. That, my friend, is priceless.


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## mickeyco (May 13, 2006)

Buy an old heavy car with solid bumpers, bring to a welder and have heavy steel reinforcement welded on, have the car highly insured and start hitting people that drive like a-holes, the ones that stay in the lane that's closed ahead and then race to the front and cut you off.


.


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## Virginia Built (Nov 8, 2007)

farm until the moneys all gone


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## Virginia Built (Nov 8, 2007)

actually i am with stone mountain on this one. 1. paydown debt. 2. buy cheap assets whle the market is bad and all these other guys are having firesales on new-used equipment. 3. look for cheap land and commercial property, there is alot of standing inventory.

or, chill out, buy a chopper and just have sme fun, give some cash to your employess, it buys alot of goodwill.

best wishes and plenty of fishes.

jeff


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## AllAmerican (Nov 17, 2007)

*You are not Donald Trump just yet.*



mdshunk said:


> I didn't' read all the responses, but I say 100K ain't squat, and you need to hold onto it for the lean times to get you through. Hopefully there will be no lean times, but you need capital reserves, for sure. The money doesn't necessarily need to stay as cash, but needs to be placed in some manner that it's easy to draw from or use as collateral for business credit on short notice.


 Agreed. 

Depending on the size of your business this could be a one time anomaly or a typical, expected profit. Don’t make any big plans for this “windfall” until you had this type of performance for 6 straight quarters. I would try to increase this profit by 3 – 5% every quarter. 

I would also consult my CPA and Tax Attorney advise me on investing and asset protection strategies. 

Construction companies have a way of eating money and profits. :furious:


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## GSE (Aug 24, 2007)

Mike Finley said:


> Okay, it's the end of the first quarter 2008. You look at your books and you have $100,000 net profit. It's sitting in your bank account, cold hard cash...
> 
> ... what would you do with it?


 
Invest it in some commercial and residential properties, asset build blus income from property inprovements and repairs, a win win situation and still holding on to the 100K golden chicken so it can produce more eggs.


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## Tricor Brothers (Apr 22, 2008)

*what to do*

i would put a portion into cd's, some into an IRA some into savings and the rest back into the business


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## nap (Jan 27, 2008)

Mike Finley said:


> Okay, it's the end of the first quarter 2008. You look at your books and you have $100,000 net profit. It's sitting in your bank account, cold hard cash...
> 
> ... what would you do with it?


I would get back to work because apparently the bank account is getting light.:w00t:


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## Cisko (Mar 21, 2008)

the oportunity to buy property real cheap is now. depending on your area you could probably find a repo in dire need of some loving that you can fix your self and rent out for positive cash flow and tax benefits. you can never go wrong investing in realestate.


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## Cdat (Apr 18, 2007)

Use half to pay off your high interest debt. Invest the rest. Maybe hold back a few thousand to buy yourself a new toy or two.


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## BirmanBuilders (Aug 24, 2005)

Vegas!!!!


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## Chris G (May 17, 2006)

Have a big sesh!!!


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## Mike Finley (Apr 28, 2004)

:laughing:


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## Iron Sheik (May 6, 2008)

Tricor Brothers said:


> i would put a portion into cd's, some into an IRA some into savings and the rest back into the business


I don't think CDs would be a wise investment. The inflation rate is higher than the return on a CD.

Google would have been a great buy on April 17th. It soared up 20% on the 18th.


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