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What is your sensible/practical plan for $1Million

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What is your sensible/practical plan for $1Million

Old 03-24-08, 11:49 AM
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What is your sensible/practical plan for $1Million

Okay, stop dreaming about The Bus' plan. You only won a million bucks. Let's say you were living month to month before that and didn't have much for retirement.

What do you do with it? It's not enough to live off the interest... so you have to make some tough decisions. When I start mapping it out, it goes away pretty quickly without anything too frivolous.

Figure a good chunk goes into taxes. We'll say 400K. Say you owe $350K on a house or would immediately get a 350K house (I know... that amount goes a lot further in some places than others... jsut an example). Is it wise to pay that off, or is keeping a 30 year loan beneficial in this case?

Paying it off would leave you with 350K or so. Put a big chunk of that into retirement and you are left without a mortgage payment but still other bills and taxes to pay so you clearly need to keep working. You obviously want to keep some of this money liquid but earning interest, so you get a CD/savings account etc etc. Using the plan above, you've set yourself up for a fine retirement, but haven't impacted your current lifestyle to a million dollar degree. Granted, you could have some fun spending your monthly mortgage / rent money on other things, but I feel like there must be something better.

If I win a million bucks, I don't want it to be "blah."

What's your plan?
Old 03-24-08, 11:56 AM
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Definitely keep the loan if it is at a good rate, and invest $900k of the money. The last $100k would be split between the $20-$30k I have in high interest student loans (6.8%), a new (used) car....probably a Porsche for around $40,000-$50,000, and $10,000-$15,000 for a trip to vegas/new orleans.
Old 03-24-08, 11:58 AM
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Taxes, donations/charity, pay off house/home improvements, invest majority of what's left, splurge a little (new car, computer, "toys", etc)
Old 03-24-08, 12:17 PM
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Put some into retirement, maybe use the rest to buy real estate, since it's a pretty good time to do so now.
Old 03-24-08, 12:21 PM
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Throw it in the pile with the rest of it.
Old 03-24-08, 12:22 PM
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I would definitely pay off the house. I don't like paying mortgage payments. I'd probably pay off our cars too. After that, I don't know. I'd probably find some way to invest the money (Stock Market and possibly other investments). Obviously, I'd still be working, but my wife could probably quit her job for a couple of years so she can finish off her second degree.
Old 03-24-08, 12:23 PM
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Wow, I guess a million bucks is as boring as I thought.
Old 03-24-08, 12:23 PM
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Originally Posted by kvrdave
Throw it in the pile with the rest of it.
I knew there was a pile of money in kvrdave's manroom somewhere.
Old 03-24-08, 12:24 PM
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Old 03-24-08, 12:24 PM
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Originally Posted by Thor Simpson
Wow, I guess a million bucks is as boring as I thought.
It don't buy what it used to.
Old 03-24-08, 12:27 PM
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Okay, 1 million. Figure $350,000 for taxes, leaving me $650k. I think I owe around $400k, so I pay that off and am left with $250k. Retirement, etc. is pretty well taken care of, so I do an amazing addition/remodel to the home and have $50k left over. That goes into rainy day accounts.
Old 03-24-08, 12:47 PM
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My main priority would be paying off my debt (credit cards, mortgage), take about $100k and splurge and invest the remaining for retirement.
Old 03-24-08, 01:08 PM
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Pay off debt, quit jobs, move back to Florida, find new jobs, don't rack up any more debt...
Old 03-24-08, 01:09 PM
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Work hard. Spend wisely. Work hard. Invest intelligently. Work hard.
Old 03-24-08, 01:20 PM
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-get out of my condo, and into a house.
-Continue work, Up 401k contributions.
-Get a new car (less than 50k value).
-Get a new bicycle (more than 5k value)
-wonder why I am still making mortgage payments.
Old 03-24-08, 01:25 PM
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Pay off debt, Buy a nice house and put the rest into a retirement fund.
Old 03-24-08, 01:27 PM
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Put it all towards a house.
Old 03-24-08, 01:37 PM
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Whatever is left after taxes, I would put into 10 year US Treasuries and keep working for the time being.
Old 03-24-08, 01:41 PM
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Originally Posted by Brian Shannon
Whatever is left after taxes, I would put into 10 year US Treasuries and keep working for the time being.
Wouldn't it be wiser to diversify your assets a little?
Old 03-24-08, 01:52 PM
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Originally Posted by Thor Simpson
Wouldn't it be wiser to diversify your assets a little?
Or at least find some nice tax-free munis.
Old 03-24-08, 01:52 PM
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Originally Posted by shizawn
Put it all towards a house.
For a second I was like, "Wow, but then I'd have to pay the upkeep on this mansion, etc."

Then I saw you're in California.
Old 03-24-08, 02:03 PM
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$350,000 taxes

$100,000 tithe/charity

$50,000 new car (something mid-life crisis-ish)

$450,000 buy house

$50,000 nice TVs/home theater system(s)/computer set-ups
Old 03-24-08, 02:05 PM
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Originally Posted by Thor Simpson
Wouldn't it be wiser to diversify your assets a little?
In this case, no.

I am looking at my situation and already have a diversified portfolio of investments. An after-tax amount from the 1MM would not be enough to get me to stop working so my goal would be principal protection. That is why I would buy the 10 year note with this money.
Old 03-24-08, 02:40 PM
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Originally Posted by Thor Simpson
Wow, I guess a million bucks is as boring as I thought.

You asked for "sensible/practical" plans and then you complain the responses are boring
Old 03-24-08, 02:41 PM
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Sell my house, move down to Virginia. Invest most of whatever was left. Find a job.

BOR-ING!

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