Dividends and Twitter users to Musk: sell 10% of Tesla stock

In the world of capitalism, the desire is to accumulate a large amount of assets and then many options are available for you. Everyone in the world knows how much money they need to live a comfortable lifestyle, there is likely another amount for a barebones lifestyle. For some who accumulate well more than the comfortable, there become other choices what to do with the money. In many families, foundations are set up to give away some of the money. When the amount is large, trusts are set up for the money to last for a long time and hopefully into generations. For those in the billionaire category, most people in the world have ideas of what they should do with the money.

In an article by Elon Musk, chief executive of Tesla is one of those billionaires and he has more money than he needs to be comfortable. He is worth upwards of $250 billion as he owns 23% of the shares of Tesla and it is worth a trillion dollars. His holdings is 170.5 million shares (with some stock options) his brother (Kimbal owns over 600,000 shares for $750 million and recently sold 88,000 shares. Kimbal is a Board member on Tesla).

Mr. Musk was considering selling 10% of his shares and asked people on Twitter what he should do and the vote is in 57.9% said yes to selling. Mr. Musk (unlike former President Trump believes the vote is illegitimate) says he accepts the outcome.

The 10% holding amounts to $21 billion, but Mr. Musk does not say what he will do with the money. He has suggest donating $6 billion to the United Nations food program to help solve world hunger, but we do not know.

Linking to dividend paying stocks, one of the reasons people buy the stocks is to have regular dividend income and overtime increased capital gains. This allows you to have options – to buy more stock, to donate the money, to have options. We know that many wealthy families have internal fights about money and lawyers receive generous fees, but we do not know when the threshold of too much comes into full contact force. As you accumulate stocks to generate dividend income have some idea of what you want to do with your money or do not want to do with your money. The last thing you likely want is family members fighting over income. Planning and wills are good.

There are more questions than answers, till the next time – to raising questions.

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