What to do with cash out refi lump sum?

[Andrew T.]

I’m planning a cash out refi on my current investment property where I’ll get a lump sum of 200k at the beginning of April.

I have another property closing March 2022. Amount due: 250k.

I will likely use this cash to then pay down the 250k as an owner occupied.

What are the best strategies to maximize productivity of the 200k for the 23 months?

[Jaysen Medhurst]

@Andrew T., I can think of 3 options right off the bat worth considering:

1. Dump it all in index stocks with a standing sell order at 5-10% below your purchase price to minimize downside risk. Raise that sell order as the market rises. 
2. If you're more risk adverse, you could split 3 ways: Index funds, bond funds, CD or other very low-risk bond.
3. Municipal bonds. You won't get a great rate but super safe and the proceeds are usually tax free.

You could also look to deploy that capital as a private lender (to flippers for example) or do a couple of flips/BRRRRs yourself. Definitely achievable with a 2-year time horizon. More work and risk, of course.