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Process of Liquidating Accounts to Invest in Dierks Bentley Whiskey Row – Denver

Time to provide an update on one of the boldest things I have done to this point on my investing journey. Early on when I started speaking with my cousin on the potential opportunity to become an investor in his bar business for a new location in Denver, he mentioned I would have to purchase units in chunks of $106,000. This is a large chunk of change ($$$), but my cousin has been opening and running bars for the last 10 years and has continuously expanded his business. He started out with one concept in Scottsdale called El Hefe and quickly expanded to 6 different concepts spanning the entire country. The major brand having the most notoriety at this point is Dierks Bentley Whiskey Row. I mean if you can get a big-name Country Music artist to go in with you on a bar, you must have great potential for it to fly off. This concept started in Scottsdale and has expanded to Tempe, AZ, Gilbert, AZ, Nashville, TN The newest of the locations would be the brand new one I would be investing in in Denver. My cousin is the president of the company and recently had the owners of the Colorado Rockies reach out to him asking if they were interested in putting a location in downtown Denver across the street from the Rockies stadium. The land is owned by the Colorado Rockies and the bar that was there is called Lodos which was one of the hottest bars in Downtown Denver; however, my cousin worked out a deal with the Rockies owners and they are going to be taking over Lodos and revamping the building entirely. This will entail knocking the building down and building a brand-new building entirely.

With the looming talks of a down market soon, I have heavily debated keeping money in the stock market or looking to place it elsewhere. I was originally going to invest the minimum $106,000 to get 10 units of ownership in the bar, but due to the wildness of the stock market, I have decided to try and up the ante a little bit. Why think small though when I can think big!!! After recently receiving a large $50,000 bonus check from work due to being rated the highest performer on my annual evaluation, I have decided to purchase 20 units instead of 10. This has been a very difficult decision and I have been working to figure out how I would come up with the money. Now let’s figure out how I am going to get to the $212,000 dollar amount I am going to need in the bank to purchase 20 units!

Account 1: Vanguard Taxable Account ($165,734.05 balance as of 3/24/19)

For this account I am going to wait until I get the dividends for Q1 before selling off my money. The only downside of completely liquidating this account is I have already seen a significant capital gain this year after the market rebounded coming off poor performance at the end of 2018.

Rollercoaster of how my Vanguard Taxable account has performed this year.

This is a part of the investing rollercoaster though. I took advantage of the EOY with tax loss harvesting and now I will have to take the gains out this year.

Current state of Vanguard Taxable Account

To make things a little simpler once the dividends come through, I have updated my distribution options to keep the money in my Settlement Fund versus re-investing. This will allow the selloff to be much easier than having to wait a few more days for everything to go through.

Account 2: Merrill Lynch Vested Stock ($8,943 as of 3/24/19)

This is a unique account that I have access to based off how I am compensated at work. My total compensation at work is broken into three different parts.

  1. Base Salary – majority of compensation
  2. Yearly bonus
  3. Company Stock – this account. The only downside to this account is the grants vest over the course of 4 years, 25% each year. For example, this last year I will be granted $52,500 in stock; however, I won’t get any of the stock until next year at which I will have vested $13,125 of the grant.

With the latest vest I received on 3/21/19, I now have 91 shares I can sell. Below are some snapshots of going through the process of selling these shares on Merrill Lynch.  

Current holdings in my Vested stock account with Merrill Lynch.
Creating a Wire Transfer to liquidate the account.

Account 3: E-Trade Taxable Account ($6,901 as of 3/24/19)

This account was something my parents opened for me when I was in High School and they had a financial advisor determine what I to invest in. Ha, wish I would have known what I know now and told them I would take control of everything because the advisor was picking random stuff that I would have not agreed to. The Walmart and Amazon stock were items I purchased once I had control of the account. Time to liquidate!

E-Trade account current state as of 3/24/19

Account 4: Bank of America Savings ($11,627 as of 3/24/19. $10,000 to be used to invest)

Since I received my bonus check, I decided to only invest a little bit of it knowing that I would be going through this liquidation process to invest in my cousin’s bar. I have one reimbursement check for my last travel trip for $2,100 coming through in a few days which will take me to roughly $13,700. Of this money, I will take $10,000 to invest.

Now let’s look at where we currently stand from a total cash perspective after these accounts are liquidated.

Account Money
Vanguard Taxable  $      165,734
Merrill Lynch WM Stock  $           8,943
E-Trade Taxable  $           6,901
B of A Savings Account  $         10,000
Total  $      191,578
Deficit to $212,000  $        20,422

I need to figure out how I am going to come up with $20,000 to hit the $212,000 target needed to purchase 20 business units of the business. I am in a fortunate situation where my parents are on the verge of retiring and I have spoken with them to see if they would lend me $20,000 at a 6% interest rate. I don’t want to take advantage of the situation, so I want to ensure they know I am willing to pay for it. After this loan, I will be right at the $212,000 mark and will have enough to invest in the business! SUPER PUMPED!!! I know putting all my eggs into one basket is risky, but my goal in life right now is to invest in assets that will produce cash! This is a risk I am willing to take at such a young age and early on in my investing life. I should complete the paperwork at the end of this week and everything will be official!

Making progress in acquiring assets instead of liabilities as that is the goal in life!

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