Saturday, October 06, 2007

The Million Dollar Fantasy Challenge

One of the sweepstakes entries for the Problogger 3rd Anniversary Birthday Bash had a simple requirement - to answer one question:

What Would You Do If You Had A Million Dollars?

I had to stop and think for a moment, because the question took me by surprise. I am one of the world's richest middle class family men, but I pondered what it would be like to actually have a million dollars at your disposal. It doesn't matter if you inherited it from your grandmother or won the lottery - but I thought that I might be fun to at least dream about having such a large sum of money.

My criteria is simple -

I would like to retire at 57

I would like to finance my daughter's college education

I would like to have money to cover basic living and medical expenses for at least 20 years in a part of the country that is affordable to retirees.

I want to give something back to the community.

I would like to travel to places that I would like to see before I depart from this earth.

I would like to purchase some electronic gadgets that won't wear out for at least 5 years.

I am going to assume that the $1 million came as an inheritance from an aunt - $1 mil

1. If this is a lottery winning then at least 50% of the money is taxed, so:

$1,000,000 * .50 = 500,000

$1 mil - 500,000 = 500,000 (Amount Left)

2. Tithe using 10% of the gross amount:

$1,000,000 * .10 = 100,000

$500,000 - 100,000 = $400,000 (Amount Left)

3. Pay off my house ($150,000):

$400,000 - $150,000 = $250,000 (Amount Left)

4. Finance my daughter's wedding ($50,000):

$250,000 - $50,000 = $200,000 (Amount Left)

5. Invest for anticipated medical expenses ($100,000)

$200,000 - $100,000 = $100,000 (Amount Left)

6. Living expenses = $100,000

This averages $5k per year for the next 20 years.

Unfortunately, there is no money left over to have fun. Is this a viable plan or not? What suggestions would you make to alter this plan? What would you do if you were in the same situation?

I am going to do some research to see if this plan is viable or not. This post will be updated with what I find out.

Related Posts:

442, 274,467 Reasons Why You May Be Richer Than You Think

Three Interesting Facts About the Number 3

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