What Would You Do With $650,000 Of Tesla Stock?

[Music] brought to you by y refi refinance your defaulted private student loans today at y rei.com Ramsey today's question comes from Chase in Florida my aunt recently reached out to me for advice since I'm considered the financially responsible one in the family she's 37 and we come from a lowincome family she worked at Tesla for 6 years and recently discovered that her old Tesla stock Holdings are now worth $650,000 wo I love it that's great she currently works as a project engineer earning 70,000 a year her monthly rent is only 1,000 bucks and she has $220,000 in debt which will be paid off this year she has retirement Investments but no cash savings she's hesitant to sell the stock because her goal is to let it reach a million dollars before selling she's also concerned about the tax implications if she sells I've explained that this mindset borders on gambling emphasizing the danger of investing in a single stock if you were in her shoes what would you do with $650,000 in Tesla stock wow that's so fun yeah what a great relationship that she comes to him with this big win and ask him what to do and he's saying you've got too much risk here and he's spot on he's so cool I love this and I do agree this does border on gambling waiting for your your single stock to go up you know another 30 something perc so that you can cash out at the right time yeah that scares me yeah you're going to have taxes welcome to making money um sorry but that goes to the territory capital gains but the good news is you know if you if you hold that asset for over a year that would hit the long-term capital gains tax exactly and she's had it over a year she's been there six years yeah so her old Tesla stock so we know it's over a year old so it's going to have long-term capital gain so it'll be at a 15% rate so it's not going to be that bad um you're going to pay probably 100 grand out of this something like that and that's if you cashed it all out at once and you are today and you are so she could be debt free today I 20,000 bucks and go buy a house yeah it's what I would do she's 37 years old she's a renter she has 20,000 in debt this would change her life to cash this out go buy a house that actually goes up in value yeah instead of potentially who knows what's going to happen with Tesla they may continue to go up well I'm not I'm not dissing Tesla but I don't I'm not buying it if you got 600 if you're 37 years old and you have $650,000 in cash stacked in the middle of the kitchen table what do you do with it would you invest in Tesla go buy Tesla stock no go buy any single stock no go buy a house yes now we're talking going to go up in value and you have no payments and you make 70 grand a year and now you're going to have another million dollars in just a few minutes if you do this because now you can load your 401ks your Roth IRAs you can stack cash um you're have zero debt and you know and no house payment of any kind no rent going out and so that's a couple thousand bucks a month minimum and we're talking about putting maybe $5,000 a month away now uh and that's going to be a million dollar another million dollars very quickly in a good Mutual series of mutual funds in your Roth IRAs in 401ks so 100% that's what I'm doing not even a hesitation if you had and the way you can sometimes see the thing is when you own something sometimes it's hard to pry the fingers off of it but if you just reset it in your mind and say there's a stack of cash in the middle of my kitchen table what would I would I go buy Tesla stock with it no would I go buy Apple stock with it no both great companies both probably going to go up still wouldn't buy have all of my eggs in one basket and I still would go buy a house you're a 37y old single lady you own a home cash paid for guess what they're going to do they're going to go up in value all the time pretty cool George pay the taxes oh yeah people are so scared of paying taxes I don't want to do anything it's like a boogeyman we don't know what it is so just add it up and you go oh that's what it is oh it's not that big a deal yeah get with your tax proba probably 85,000 bucks or less and they'll go here's what it is you all right I'll pay that out of the uh the proceeds and now you got you know it's almost like it's found money anyway I I recently discovered CED that might ow quite the thing to forget about kind of found money you know I mean so it's like and and now I'm worried about giving up a little no don't cuz I again I am not predicting Tesla's uh success or failure or I'm not betting for or against Elon Musk as a business person none of that that's not the issue the issue is it's a single stock if you had it all in Microsoft or Dell or apple or McDonald's or cocacola I don't care what you what you name some big Stable Company that's not brand new on the scene and not cutting edge technology that's a little weird you know I mean name one of those and I still going to tell you not to do it so I don't do it I don't have I don't have $650,000 in a single stock and I got a a lot more than $650,000 so I what if I thought it worked I'd be doing it you know so no that's it I hope that was clear Chase I don't think Dave can be any more clear da Dave has a trouble with Clarity he sometimes has trouble telling people what he really thinks why refi refinances delinquent private student loans for struggling borrowers learn more at yy.com Ramsey