... 10% return. Would take 10 years to break even, with no potential to make more. thoughts???
Answers (3)
Sounds like a terrible return for the amount of money you are considering investing especially over such a long time frame. I'm sure you can get better than that with far less risk and without tieing up the money for that period of time. You should talk to your bank manager or accountant and take their advice.
a ten year investment surely carries a risk due to the long time you will need to keep the money tied up with that investment. what is the guarantee you have for the 10% profit?? is it 10% a year or 10% over the 10 years? Being brake even in 10 years suggest to me that this is 10% a year but please confirm. Based on your answer I shall be able to elaborate more.
Most guarantees are near worthless. They are just promises, easily broken or not enforceable if times turn bad. Mostly they are just enticements to get people do something they otherwise wouldn't do. That is, a sales gimmick. The main thing is how much can you get if you sell your 10% of the business on the open market and not some promise from the major owner. If you can't sell it for 150k or more on the open market, don't do it.
Furthermore, in the present economy with counterfieting called QE1, QE2, QE3, and soon QE4, the dollar will lose half its value in 5 years. Therefore, even if you luck out and receive 10% for the next ten years, you are not receiving value for your money unless you can be certain that you can still sell your 10% of the company for what you paid for it plus inflation.