While I was having lunch with a friend, he asked me, “What would you do if someone gave you 1 million dollars?” Jokingly, I said “spend it.” Of course he knew I was kidding…for the most part. Since it is VERY unlikely for someone to just hand over a million in cold, hard, United States cash, I still wanted to give him a truthful answer to his question. Here is what I came up with…
- I would first pay off ALL of my outstanding debt – Bookies (Sallie Mae), loan sharks (credit cards) and the KGB (IRS) Everything paid! Debt free…YAY!
- Give! - I will give away $100,000 to good causes. I won’t give it away all at once or to one person/organization. I will probably open up a charitable foundation and give money as I see fit. I might create a college scholarship program or start a non-profit organization that would educate people financially and help them get out of debt.
- Spend! – I will purchase, in cash, a modest home here in Texas. (approximately $200k) – I will buy a newer, low mileage, used car to replace my 1998 Honda Civic that has almost 200K miles. I will then take a global vacation, visiting many countries. Remember that you have to enjoy your wealth. If you don’t enjoy your money, then why have it?
- Save! – After my global vacation I would take the remaining cash and talk to a financial planner such as Rick Kahler, http://www.kahlerfinancial.com and come up with a plan to grow the remaining money for retirement. Rick is a fee-only Certified Financial Planner, CFP(R) out of Rapid City, SD that has a heart of a teacher and not a salesman.
- Continue to work! – Since I will have a little financial breathing room I would probably look into building a business. There is nothing more rewarding than working for yourself as long as you are making good profits!
Obviously, this is the Reader’s Digest version of my plan. My friend seemed impressed with my answer so he then asked, “Well what if it was 10 million dollars?” I said “simple…same answer.” I told him to keep in mind that when you come into contact with a large amount of money, you do not need to rush to spend it. It should be your goal to keep as much of it as you can and still enjoy it. There are many stories on the Internet about people who win millions in the lottery and they end up broke shortly afterwards. Many lottery winners have called winning mass amounts of money a “curse.” It is my opinion that it is not a curse, but a blessing. It is only a curse when you do not know how to management money.
So the burning question I have for you is… what would you do with 1 million dollars? Let me know…
To your financial health – Martilyo!