Ever since the disaster of not playing the lottery and missing my chance to win $350 million, I’ve thought about what I would do if I won a million dollars. The commercials for the lottery say that all I need is a “little bit of luck” or “a dollar and a dream” and I’ve had both. So, putting my luck and my dreams together, I’ve come up with my very exacting plans for what I would do if I had a million dollars. My long lost great aunt Bertha who I haven’t seen since I was a baby passed away – follow along here. In memory of my cuteness as a baby she left me a million dollars and left enough money to pay the taxes on it as well. So I’m now flush with a million dollars in cash. After nearly fainting and screaming, my heart has slowed down enough to allow me a breathe and think of what I’m going to do.
- Normally, I wouldn’t have told my family anything, but since Aunt Bertha left me the money, they already know. I’m sure some long lost cousins of my own will be knocking on my door, so I’ll have to move into a Comfort Inn for two weeks or so, and get a second cell phone since my phone will be ringing off the hook. “You’re cousin who? From where? No, I don’t think that I have any cousins in Siberia, but thanks for calling.” Obviously, I won’t tell anyone at work, and I’ll continue to go since healthcare is expensive, but I would have a smile on my face every day that I walked through the door.
- Before I get too happy, I’ll cut some checks to pay off all the debts that I current track on this blog. It would be completely irresponsible of me to get this money and not pay my debts. Even if I went crazy, paying my debt should always be a priority. Now debt free, I can breathe and get ready to have some fun.
- I’ve needed a vacation for a long time, but I don’t want to go nuts. I’ve always wanted to go to Bora Bora. The water looks beautiful (see photo above) and it’s clear on the other side of the globe. I need just enough time to relax, clear my mind and think of what to do next. I wouldn’t spend more than $15,000 for this vacation for myself and my BF…or if he doesn’t want to come, my brother.
- Almost as import to me as paying my debt is having a solid place to live. Yeah, I own a rental property, but I don’t make enough to own a home in New York City and now that I’m left with about $915,000, I can’t afford to buy a home that would average about $500,000. I would consider moving out of the city but not too far. Maybe somewhere upstate New York, Delaware or Maryland because I would still need to commute to work. I wouldn’t pay more than $300,000 for the home. The question here is whether I would get a mortgage or pay for the home outright. There might be some benefits to getting a mortgage even though I could pay for it, but quite honestly, I’m paranoid and having peace of mind is more important to me than anything else, so cash it is. I’m now down to $600,000.
- Time to make my money work for me. I don’t want to work for someone else for the rest of my life. I’m not cut out for that. With no debt, a paid for home, and a steady job, I could live comfortably for the rest of my life while stashing money for my retirement, but that’s not me. I would instead like a proven system of making money that won’t actively need me to be there every single day. I would invest in a national fast food chain with low entry costs. As Americans we love to eat and we love our food fast and consistent. The ones that I like best are Subway, Dunkin’ Donuts, and Arby’s. These companies are very recognizable and better yet, they’re always in the Top 10 Fast Food Franchises as compiled by Entrepreneur Magazine. This will take time and money. I’m willing to invest roughly $300,000 into my ventures and keep another $150,000 on hand for operating costs.
- I’m down to $150,000 already! Gosh that went by pretty dang quickly. While you might think that $150,000 is a lot, I will need money to stash away for retirement and into an emergency fund, so off that money goes.
That wasn’t very glamorous was it, and I’m already out of my million dollars, but let’s review what I did. I paid of my debts, bought a house, set up an income stream that could take care of my income for decades and then put money into retirement. While it took a million dollars for me to do it, this is exactly what you should be doing with your paycheck anyway. According to the census Bureau, the average lifetime earning of a high school educated person is $1.2 million so you will most likely have made a million dollars anyway.
All in all though, is it me or does it seem like a million dollars doesn’t buy what it used to. Using this example a million dollars is not enough to retire on in 30 years.
So, what would you do with a million dollars? Come back on Sunday to see how Jacob from My Personal Finance Journey and some other financial bloggers answered this question!