$350,000 in hand and invest or buy existing Business

[Nimster Win]

Hi,

 I Live in San Diego CA and have inherited 350,000 after taxes . I lost my job after going home to take care of my ailing dad who passed away . I sold his my share in business in India and moved back here. There is a cafe that makes 480,000 a year in a prime location and the owner nets 80,000 a year and works only 20 hours a week. The asking price was 275,000 and I bought it down to 250,000. Is this a good price as most cafes sell 2-3 times net?? Or should I invest in the stock market in Amazon, Netflix, Boeing and a couple others . Thanks ( Also have $5000 a months that will come from salary from a business in India . Thanks 

[Omar Khan]

@Nimster Win Would urge you to never disclose your private details on the Internet.

The restaurant/cafe industry has one of the highest failure rates of any industry. I highly doubt the owner only works 20 hours/week. If you want a safe place to "invest" your cash then this might not be the best way forward. You will be paying money to buy a job. 

I will have to disagree with @Aly Vizcarra. Investing in low-cost, broad-based index funds/ETFs is the best way for most individuals. Having a tangible asset is useless if that tangible asset isn't performing. Over the long-run, the S&P500 index beats, practically, all other investments in the world. That is a mathematical fact proven over multiple decades of research. 

In your particular case, you have not outline what your professional background is like. For instance, if you are a STEM graduate (on average, high income potential), then it might be better to invest in a combination of S&P500 and real estate portfolio. If you are not a STEM major or you have a lower income earning potential, then you have to be even more careful as you do not have a lot of room for error. 

Acquiring an existing business is a very easy way to get into the game but make sure you understand all the risks and not take broker/owner's advice because they have a conflict of interest  - they want to sell you their business at the highest possible price.