It’s always fun imagining what you’d do if you won the lottery. In a geeky way, my thoughts end up thinking about what shares I’d buy to be set up for life.
To be set for life you’d need to win a large amount. $100,000 would be a life-changing amount to win, but it’s not enough to live off permanently.
So you’d need a few million to live comfortably forever in my lottery fantasy.
Before I get into my ideas, I’d definitely want to set aside a few thousand dollars to go on a nice holiday somewhere to think about what’s happened and how to handle it.
I’d also think very carefully about who I’d tell. It might be best not to tell anyone except your spouse. Some family and friends may turn funny if they know you won the lottery.
The first major money decision I’d look at is if it makes sense to buy a property to live in. I’m currently renting, so it would be nice to fast-track my house buying. If I won enough (more than $1.5 million), I’d very likely buy a property.
I’d then set aside around a year’s worth of living expenses in a high interest savings account, in-case another GFC comes along.
With what’s left I’d want to split across three or four groups. I’d want a sizeable portion to go into pretty defensive dividend shares that are pretty good value and have long-term growth potential like Rural Funds Group (ASX: RFF), Vitalharvest Freehold REIT (ASX: VTH), Duxton Water Ltd (ASX: D2O) and InvoCare Limited (ASX: IVC).
In the next area I’d put a lot of money into are global listed investment companies and trusts (LICs and LITs) that have a market-beating record that are trading at discounts to their underlying values like Magellan Global Trust (ASX: MGG), WAM Global Limited (ASX: WGB) and MFF Capital Investments Ltd (ASX: MFF).
Another area I’d put a sizeable amount of money into is ASX-focused LICs that pay good yields and aim to grow the dividend like Future Generation Investment Company Ltd (ASX: FGX), WAM Microcap Limited (ASX: WMI), Naos Emerging Opportunities Company Ltd (ASX: NCC) and NAOS Small Cap Opportunities Company Ltd (ASX: NSC).
The final area I’d think about is long-term growth shares at good value which pay a dividend which could help me further with my personal cashflow like Webjet Limited (ASX: WEB), Costa Group Holdings Ltd (ASX: CGC), Citadel Group Ltd (ASX: CGL), Propel Funeral Partners Ltd (ASX: PFP), Gentrack Group Ltd (ASX: GTK) and Bapcor Ltd (ASX: BAP).
I reckon I’d have a very good all-weather portfolio which created good dividends from some areas and growth in other areas. So, if anyone would like to give me a winning lottery ticket, I know just what I’d do!
Some other shares I’d think about for a diversified portfolio to perform well in most economic conditions are these top ASX shares.
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Motley Fool contributor Tristan Harrison owns shares of COSTA GRP FPO, DUXTON FPO, FUTURE GEN FPO, InvoCare Limited, Magellan Flagship Fund Ltd, MAGLOBTRST UNITS, NAO SMLCAP FPO, Propel Funeral Partners Ltd, RURALFUNDS STAPLED, Vitalharvest Freehold Trust, WAM MICRO FPO, and WAMGLOBAL FPO. The Motley Fool Australia owns shares of and has recommended Bapcor, COSTA GRP FPO, and RURALFUNDS STAPLED. The Motley Fool Australia has recommended Citadel Group Ltd, DUXTON FPO, GENTRACK FPO NZ, InvoCare Limited, Propel Funeral Partners Ltd, and Webjet Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.