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Your Take: What Would You Do With A Million Dollars?

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Earlier this week Nickel sent me this awesome video about someone building a ridiculously posh treehouse in their backyard. The video’s background music is If I Had A Million Dollars done by the Barenaked Ladies Bluegrass Tribute (I think!) and so I thought to ask a few personal finance bloggers what they’d do if they had a million dollars. Would they build a treehouse in their yard?

Surprisingly none of them wanted to build a treehouse in their yard. In fact, the vast majority did exactly what responsible pfbloggers always advise people to do, pay off debt, save for the future, and then spend a little of the rest on yourself. Here’s what they said:

Flexo said:

Start a foundation promoting arts education, a million is just enough to get it started.

Paid Twice said:

I’d get out of debt, buy my parents a house where we live, pay taxes, give 10% away, and whatever is left, put into retirement and college savings for the kids.

Nickel said:

If a million dollars suddenly fell into my lap, I’d invest the vast majority of it. The concept of “financial freedom” is very attractive to me, so I’d focus on building up that nest egg. I’m not saying that I’ll necessarily quit my job when we reach that magical crossover point, but it’s hard to put a price on being in a position to make that decision.

JD said:

I would leave it in the bank. I’m old and boring.That’s not quite true. I’d put it in index funds until it reached $2-$4 million, then go all Suze Orman and shit, putting it into bonds and living off the proceeds.

Lynnae said:

[I double posted one quote and managed to lose Lynnaes….]

MrsMicah said:

Get out of debt, buy a house, help out our parents, give some to church/charity, and invest the rest.

MoneyWatch said:

Pay off mortgage (approx $300k) save $300k invest $300k and spend the rest – holiday, car etc.

NCN said:

I would purchase a nice home on a few acres, and put the remainder in savings. Over time, I would use the savings to pay for kids college and future ‘major purchases”. And, I have one or two close friends / family members that I would like to help.
I might upgrade a few things in our house, but the last thing I need is more ‘stuff’. I’d use it as a major-league security blanket. We’re homebodies, but we might be inclined to take an extra vacation or two a year, if we had that kind of money in the bank.

Trent said:

Put it in something that earned a very secure 4-5% in perpetuity – t-bills or something – and then basically stop worrying about the day-to-day crunch of my life.

Cap said:

If I’d ever win the lottery or receive some large windfall, I’d love to be able say some grand things such as I’ll properly invest it and make it grow so that I can help notable foundations or charities. But when I really think about it, I think realistically I’d take care of my immediate loved ones first. It’s a bit strange… when I was much younger; I would most likely dream of the wild things I can acquire from winning the lottery. These days, as long as my family and loved ones are happy and content with their life, I’ll feel pretty rich — regardless of our material possession. This may sound like a cheesy canned response, but it’s the cheesy truth!

What would I do with a million dollars? I’d replace the roof to our house, buy my lovely wife a Prius, then invest the rest in a good mix of income generating stock market investments and subsidize our current income with the earnings. A million bucks is a nice chunk of change and makes for a good “life subsidy.”

What would you do with a million?

{ 43 comments, please add your thoughts now! }

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43 Responses to “Your Take: What Would You Do With A Million Dollars?”

  1. Fred says:

    I would invest 25% in index funds, buy a share of Berkshire Hathaway, sell my car and house, and buy a smaller, newer, more energy efficient house, and a 2008 Toyota Prius.

  2. Tom says:

    Pay off everything, including mortgage. Buy myself a new(er) car. Go on an around-the-world trip with the entire immediate family. Invest the rest. It’s too bad we are all financially responsible people, because I would love to blow most of it on this:

  3. fred@opc says:

    I am very encouraged by the number of folks who responded that they would give some of the money away.. I also whole-heartedly agree with Nickel – it’s hard to put a price on having the “option” to leave work. There’s something about earning that freedom that is very satisfying.

  4. CF says:

    Nickel captured my feelings 100%. I’d invest most of it and consider myself much closer to the point of “freedom”.

  5. Patrick says:

    First – taxes and charity. How much to each, I don’t know. But once those are done, you have an exact idea of how much you have. Then I would pay off the mortgage (I know the arguments for and against, but I also like the freedom of no bills). Then a family get together or vacation, and a mixture of investments with a strong portion aimed at growth, and a smaller portion in bonds or dividend stocks designed to periodically shoot off cash. I wouldn’t quit work, but I would seriously consider taking a job that pays much less if it made me happier.

  6. Master Phu says:

    I would take the money and build a university in Vietnam. My parents had to flee the country after the war and I have yet to visit but I would really like to help continue Vietnam’s economic development by promoting higher education. A million would not do much here in the US but it should go really far there.

    • pearly says:

      I’m doing a speech on what would i do with one million dollars for school and your idea gave me a graet idea.

  7. Mrs. Micah says:

    Thanks for including mine. I get the feeling that I’m going to have to make my own million…which means that I won’t get it all at once. But knowing what I’d do with it if I had it is actually a pretty good way to form a blueprint for what I’ll do with it over time.

  8. Jay says:

    Make sure my disabled daughter was taken care of (our gov. sure isn’t going to).

  9. Thomas says:

    Put it all in a safe 5% earning account of some type, take the 50K interest every year and live/travel/volunter year round in cheaper countries( Central America). If that ever gets old, I’ll still have the million to do something else with.

  10. Naqutus says:

    I would first find a company that I could donate a portion of it to. That would truely benefit from it. Some company that sponsors kids with disabilities, hunger issues, or start my own company helping those that are truely in poverty in th US. Helping my people who are truley in need of financial help. Then I would take care of my five kids. Buy the a house and a van, and put the rest away for there college education.

  11. Forty percent in VTI and sixty percent in VEU… then pretend that it didn’t happen for quite awhile, possibly years.

  12. john says:

    Pay off the debt. Quit my job, and live off of it for a few years while I finish my degree and get established in my new career. After that, I would keep an emergency fund as liquid as possible, but invest the rest in something safe.

  13. wanzman says:

    Jay said:

    “Make sure my disabled daughter was taken care of (our gov. sure isn’t going to).”

    Should they be expected to?

  14. saladdin says:

    Rent Angelina Jolie for the night.


  15. JoeTaxpayer says:

    Dollar cost average to match my current allocation, and retire a few years early. Not too exciting, I know.

  16. You mean besides 2 chicks at the same time? Office Space anyone 😉

    I’d hire a money manager, move closer to the city, and keep on working as usual – too young to be boring. Oh – I’d also give a portion to each family member, and to charity fo sho.

  17. Bill says:

    The music in the video is actually the original Barenaked Ladies version of “If I Had a Million Dollars” and not the bluegrass tribute. The bluegrass version has less piano, more banjo, and more traditional bluegrass-sounding harmonies. Either way, it fits the project nicely.

    Personally, I’d pay off the house, and probably my mom’s house too. Give a bit to charity. Buy a new car. Invest what’s left. Not terribly original, I know.

  18. mike rowe says:

    me? would do nothing. I mean “nothing”. but, of course, 1 million is not enough nowadays. it’s a psychological milestone, but due to inflation, i’d say the number is actually closer to 3.5 million these days 😛

  19. KEn says:

    Dang Budgets are sexy, you beat me to it.

    Pay off my debts (30k student loans), pay of moms debt (prolly about 30k), help my inlaws about the same. But some camera gear, new car, find a new job, get a new modest house to fix up near new job. And have 500-600k left over to invest and allow me to fully fund roth and 401k.

  20. Let’s put this in perspective: $1,000,000 invested in a 40%/40%/20% mixture of bonds/stocks/cash will give you an approx. 99% chance of living of $25k per year for the next 40 years (no guarantees after that).

    Now, I don’t know about you … but $25k ain’t rich. So I agree with your closing statement: “A million bucks … makes for a good “life subsidy.” …

    … you’ll probably still need to work.

    PS That’s why aiming for $1Mill. in 20 years is just too low a target for most people … inflation means that it will only be worth the equivalent of $15k a year (in today’s money).

  21. KEn says:

    AJC, you could easily invest in 4% cds getting you easily 40k per year with no work, lasting forever.

  22. AJC: Exactly. Which is why I’d add it to the nest egg and keep it growing. You won’t be instantly “rich” but it’s certainly a good start.

  23. Gary says:

    I’m nearer retirement age so I would be like Willie Nelson and go “On the Road Again” and go places I have never been. I would set up a portfolio of US government securities that would yield about 7% annually for spending loot. 70 Grand tax free a year would pay the bills and buy 3 tanks of gas the way things are going.

  24. Shanti says:

    Eh, a million dollars isn’t THAT much. Most houses here in Seattle are worth half that. Maybe my mindset is skewed because of where I live? I hear mansions in Ohio are $90k, which I think is haughable and unbeluieveable at the same time 😛

    If I had a million dollars, I’d buy a motorcycle and a small apartment in Italy, buy a house for me and remodel it to my dream house, finance my two sisters’ college educations, and invest the rest (probably around $400k). I’m 22… $400k now will be a lot in 10 years, in 20 years! After it grew a little, I’d probably quit my regular home businesses and go into something I fantasize about, such as designing clothing. It’s fun to think about 🙂

  25. Cap says:

    Answer above was for “winning lottery” here’s the one for “million dollars:”

    If I win a million dollars from the lottery or some large windfall, I’d love
    to be able to say some grand things such as I’ll properly invest it and make
    it grow so that I can help notable foundations or charities. But when I
    really think about it, I think realistically I’d take care of my immediate
    loved ones first. It’s often said these days that a million dollar isn’t
    what it used to be, and there’s no denying that. But regardless, it’s still
    a life-changing amount for many of us today. If I can help my family and
    loved ones with this money, I’d feel pretty content and rich. This may sound
    like a cheesy canned response, but it’s the cheesy truth!

    haha, I’m sure no one cares but there’s a big difference between a “million dollars” and “filthy rich from the powerball.”

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