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Of course, there are people who came across a windfall by lottery ticket/inheritance or even gambling. Numerous studies and/or media news have shown that the windfall usually does not last very long.
I know someone that won on a progressive slot machine at a casino - the prize was near $2M before taxes were taken out. He immediately retired at the age of 42 (he already had a lot of $$ thanks to good investing since he got his first real job at 22), invested the remaining winnings after giving modest gifts to his immediate family members, and has lived comfortably on the withdrawals for the past ~15 years with no end in sight. Kudos to him for doing so well and being so smart about his money!
It would depend on circumstances. I'm sure I could spend a million in short order. The trick would be in preserving it in case my wife or I get old and sick, whereupon it would disappear quickly with medical and care expenses.
I'd pay off my mortgage which is quite a modest amount and strongly consider buying a pied a terre in Chicago, preferably one I could rent out while I wasn't there. The rest would be invested in a broad market index fund. I have a number of years before I'd consider retiring but I'd use the maybe $20k a year returns from that for travel. The invested balance would really just be "extra" to fall back on in addition to my 401k, Roth, and pension.
This is a great forum to post this question due to its activity, sage wisdom among posters and the fact that some here who are retired may be on a fixed income.
What would you do if you came upon $1 million in a lump-sum either from an unexpected inheritance or winning the lottery?
Be specific; thanks.
If I were reasonably well-off at the time of the windfall, I might start a small nonprofit foundation for a cause I feel close to. Why not; I can't take it with me.
Location: East of Seattle since 1992, 615' Elevation, Zone 8b - originally from SF Bay Area
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For us it would solve the problem of where to live upon retirement. We want to remain close to the kids/grandkids but would really like to be in the mountains, at least spring-fall. That extra money would allow us to have two homes, and the ability to fly between them on a semi-regular basis.
I would invest $200k of it in a couple different semi absentee franchises. I'd tithe, pay off our debt, buy a house and two new cars. Take a vacation and buy new furniture and wardrobe for all 4 of us. Cut back to part time work until the franchises started paying off and made enough income to expand themselves, then I'd quit my job.
The remainder of the money (about $300k) I would invest in various stocks and bonds with the advice of a financial planner, but also set some of the funds aside for the kid's college.
Going to S. America on a loooong vacation. Then, come back and hire a financial adviser. Give more money away to the charities that are important to me. Buy a car, but a cheap one cuz I could care less what I drive. Give my husband an expensive gift.
1) Pay taxes.
2) Set up a Special Needs Trust for my SO's disabled child.
3) Buy great health insurance for myself, SO, and the dogs
4) Finish my house
5) Go on vacation while the house is finished
6) Make some donations to animal rescue organizations
7) Put about 100K in a RAOK account. THAT would be more fun than I could stand! I would love that!
8) I would keep about 100K in a simple savings account and invest the rest.
I KNOW lottery tickets are a complete waste. But back in the long ago days when I had money I would buy 1 when the jackpot reached astronomical amounts. Not because I thought there was a chance I would win. Just for the dreaming about it!
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