Hi there, Mrs. 1500 again.
Last week, I asked about your grocery budget. What do you spend on groceries, and how many people are you feeding? The answers I received were all over the board. It seems that most people are spending between $200 and $300 for 2 people per month. That doesn’t seem excessive to me.
Jacob from Cash Cow Couple spends less than $100 a month, by buying everything on sale and having a stockpile of deer meat. Michelle at Shop My Closet Project recently planted a garden to help offset grocery bills. This is an excellent way to trim food costs, and even small container gardens can provide tons of produce for you to enjoy. I can’t wait to move and plant a garden!
__________________________
We were traveling last week, on a whirlwind Midwest road trip. It seems every state we drove through takes part in one of those giant, multi-state lotteries. The jackpot, in case you missed the story, was the ridiculous amount of $600 Million!
With very little effort, I can purchase a ticket and then convince myself that I possess the winning numbers. I daydream of what I would do if I won, and then when my numbers are not called, I feel real disappointment that I didn’t win. (I have also entered the Pillsbury Bake Off this year, and have similarly convinced myself that they will announce my name as the winner of the million dollar prize.)
I know many of you do not play the lottery, and that is fine. I only buy a ticket when it is “worth it” (as though if they called my numbers for a pitiful jackpot of “only” $10 million I would say “no thanks, not worth my time.”) and I only buy one ticket (~$5/year). Purchasing more than one ticket does not significantly increase your odds of winning. Purchasing 100 tickets doesn’t, either. While the chances of you winning are extremely low, they are infinitely higher than if you didn’t buy a ticket at all.
But imagine that you did hold that winning lottery ticket. That you are now $600 million richer. What would you do if you held that sole winning ticket? Some questions to ponder:
- Would you conceal your identity? Not all states require winners to be publicly identified.
- Who would you tell?
- Would you keep working? If not at your current job, what?
- Many lottery winners’ lives end up in ruin. What would you do to avoid this?
- Finally, what on earth would you do with all of that money?
Join the 10s who have signed up already!
Subscribing will improve your life in incredible ways*.
*Only if your life is pretty bad to begin with.
Great questions! Yes, we would conceal our identity. No, we wouldn’t tell anyone, maybe not even our kids! We’d pay off our debt, and then spend the rest on helping those in need and other value-based spending choices. No Ferraris and gazillion dollar mansions for us 🙂
Laurie @thefrugalfarmer recently posted…Why You Should Choose to Start Your Journey to Debt Free TODAY
Not even a starter Ferrari? Mr. 1500 has a passion for cars, but cannot justify spending that kind of cash on something like a car. If we won, I would go buy him one myself.
I don’t know what I would do with *all* of it, but the first thing I would do would be to pay off the rest of my debt, pay off the house, and put a good chunk into retirement. I would want to donate a lot of it, I think. I would probably help my sister with her school debt too, but I probably wouldn’t tell anyone besides my husband and my parents, because I wouldn’t want people coming out of the woodwork asking for help.
I would probably keep working, but that’s just because I’d get bored not having anything to do all day!
I don’t know what to say about the would you work thing. In high school, a classmate’s dad won what was, at the time, the largest lottery in Illinois history. (Something whopping like $23 million.) He chose to continue working, and just pay off debt and buy a vacation home.
On the one hand, I wouldn’t want to be in a job that I hated. At my last job, before “retiring” to stay home with my girls, my boss was a credit-stealing, clueless, vindictive woman who had been with the company for so long, they didn’t feel they could fire her. I really liked the job, but she was so toxic, it was difficult to work there.
I really want to open a bakery. I think I would take my winnings, travel around the world, then settle down and open a bakery. Who cares if I make a profit?
I spent $10 on tickets and didn’t win, but it’s still fun to play!
1 & 2. I would conceal it if I could. I think in Missouri you have to be public though.
3. I would probably switch to volunteering. Maybe an international cause.
4. I consider myself very good with money, so I think I would be able to avoid financial ruin. I would save a lot and tuck it away!
5. I would buy nicer things, in CASH. And give some to family and friends.
Michelle recently posted…Student Loan Update and $805 in Extra Income
Since there are states that do allow you to conceal your identity, I would go find a house that was for sale in one of those states. Pay cash and back-date the sale so I could conceal my identity. Not the most legal approach, but why do you have to disclose your identity when the prize is so large?
I think volunteering is a great idea. Keep yourself occupied, but also be able to fly to Paris for French food on a whim…
What a great thought, no? Well, assuming Uncle Sam took his share, leaving me with roughly $350 million, I would immediately work to protect this money like it was the first dollar I had ever earned. I would become a ghost and disappear. Why? Because you immediately go from being a nobody to someone with a massive target on your back.
Sure, we can talk about the various investments and means to protect this money from inflation and earn a nice return on investment, but at the end of the day, the greatest threat to you would be the loss of privacy and amazing number of “friends and family” that you would have.
How to avoid the post-lottery disaster? Well with $350 million in the bank you would need to have an impressive burn rate to eat through all that cash. Even earning just 1% on your money would give you just under $2 million in after tax income without touching the principal. Again, some serious spending would have to occur to clear out $350 million.
So what would I do with that money? I’d “keep” $50 million of it to support myself and my family. The rest I would use to set up a perpetual fund to dole out $50,000-100,000 grants to start-ups. I am a big believer in rewarding the entrepreneurial spirit, and this would be a way to fund and support those dreams and passions. I would leave my job and focus entirely on this project.
writing2reality recently posted…Passive Income – April 2013 Update
“…Well, assuming Uncle Sam took his share…” Uncle Sam ins’t greedy. I am sure he would just let you keep all of it. 🙂
I like the idea of giving back like this. Perhaps I could buy a seat on Shark Tank?
Dream job = seat on Shark Tank
Some how I would just need to dislodge Mr. Wonderful…
writing2reality recently posted…Passive Income – April 2013 Update
* Would you conceal your identity? Not all states require winners to be publicly identified. – I would definitely want to stay anonymous.
* Who would you tell? – I may end up telling my immediate family.
* Would you keep working? If not at your current job, what? – I would probably quit my job and start my own company.
* Many lottery winners’ lives end up in ruin. What would you do to avoid this? – A lot of lottery winners 1) get the cash value and then 2) hyper-inflate their lifestyles. When they’ve spent it all, they have nothing left but regrets. My first move would be to go with the annuity option – this way, I know that I’ll continue to have a steady stream of cash flowing in for the next 20 or so years. My second move would be to create a new budget to ensure we continue to live well below our means.
* Finally, what on earth would you do with all of that money? – I’d like to travel the world to expand my horizons. But I will probably end up investing quite a bit and pursuing new entrepreneurial paths to continue generating more income. That extra income can then go to charity, funding for research labs, and scholarships.
If we ever do win the lottery, then you may see us in the next Berkshire Hathaway annual meeting!
Mrs. Bookworm recently posted…To Sell or not to Sell
We can still see you at the Berkshire Hathaway Annual Meeting next year – current price of B shares is $113.10. Buy a share and we will see you next year.
If the winning ticket were in my hand? Well, I’d have to hand it back to the person who bought it! =).
I’ve only ever paid for 1 lottery ticket once in a company pool that I was guilt tripped into joining.
But if we had a sudden windfall, we’d probbly hide it in large part and form a trust that pays out enough to live on. I think I’d probbly also start a scholarship fund, since I benefitted from so many scholarships when I was in school.
Mrs PoP @ Planting Our Pennies recently posted…Investment Pass: We Won’t Buy This House
I never did like those work lottery pools. You don’t want to bother, but you don’t want to be the only left working when everyone else wins…
Great questions. We did not buy any tickets this time but maybe do once a year when the jackpot gets big and we’re actually aware of it. I am not certain what Nebraska does, but would choose to stay anonymous if at all possible. We’d tell our parents and that would likely be it. We would guard it like it was our first dollar earned and would take time to decide how to invest it and what we would want to do. I think we’d still keep our business, though scale back a lot on it and switch to more volunteering.
John S @ Frugal Rules recently posted…Did Your Degree Come With a Course on Student Loans?
Winning an amount like that would be crazy. I also purchased a ticket for the drawing, but I’ll go on and spill the beans now. I wasn’t the winner. I was hoping that no one would win though because there would have been an outside chance of hitting a $1 billion lotto payout. That would have been just crazy to see. Even splitting that 20 ways you’d still come out with a nice chunk after taxes.
I would do my best to conceal my identity from the public, although all of my family would know. First up is I would be on the hunt for some property that we really loved and would work on the plans for our house. After getting that built we’d invest the rest and then live off the income it churned out every year. Travelling the world would definitely be in the cards with that kind of money. After the initial shock wore off and purchases, I’d be with family and friends every single day. I’d also be devoting a lot more time to charities and helping out however I could.
I’d really consider some venture capital opportunities. I love the show Shark Tank.
JC @ Passive Income Pursuit recently posted…Option Expiration Friday and a Closed Option
I love Shark Tank, too. I wonder how difficult it would be to get a seat on the show? Maybe be a guest shark? Although that would shoot the anonymity out of the water…
Amen to the VC opportunities! I thought along the same lines above. Just too much fun to review and examine startups and help them succeed!
writing2reality recently posted…Passive Income – April 2013 Update
What strikes me about the “if I win the lottery” question is how to apply the answers to real life. For instance, I’d love to support entrepreneurs, but I can do that right now using Kiva (a modest loan goes a long way in a developing country!) True, I can’t fully fund my nieces’ and nephews’ educations, but I can give them cash as gifts for their RESP. Most of us can find ways to donate time, goods or cash to causes we care about without striking it rich if we structure our budget and schedule accordingly.
Other things such as buying a modest home with no mortgage, making sure my (and my family’s) retirement is fully funded, and other major gifts and donations would require a major windfall 🙂
Would you conceal your identity? Not all states require winners to be publicly identified.
Absolutely!
Who would you tell?
Definitely my family and boyfriend. And maybe some very close friends.
Would you keep working? If not at your current job, what?
I wouldn’t keep working at my current job. I’d probably try my hand at starting my own business.
Many lottery winners’ lives end up in ruin. What would you do to avoid this?
I try my hardest not to inflate my lifestyle too much. I’d continue to save and I would pay off all of my debt.
Finally, what on earth would you do with all of that money?
Along with paying off my mortgage/car loan/student loans/CC debt, I would buy (with cash) another house, perhaps an investment property. I’d also like to open my own business – a cafe!
Lisa E. @ Lisa Vs. The Loans recently posted…Links Lisa Likes – 5/17/13
â– Would you conceal your identity? I think I live in a state where I have to come forward and identify. Then I would disappear
â– Who would you tell? Well everyone would know, but only parents and close friends would know were I went once I disappeared
â– Would you keep working? If not at your current job, what? I kind of like my job, but if everyone knew I had that kind of cash I would probably have to quit.
â– Many lottery winners’ lives end up in ruin. What would you do to avoid this? Yeah I’m pretty stingy with spending money so I don’t see this being a problem
â– Finally, what on earth would you do with all of that money? Talk to a good estate attorney and start working playing the loop holes like the mega rich do to avoid the almost 50% death tax. Once that is squared away I would enjoy doing pretty much whatever I wanted when I wanted.
I used to live in Illinois, and one of their radio commercials was a woman singing “Somebody’s gotta lotto, might as well be you.” Another, more recent ad included the catch phrase “You gotta be in it to win it.”
I guess I have a 100% higher chance of winning than you do. Is that how statistics work?
No, it isn’t. Because if Jake Erikson didn’t buy a ticket, his odds of winning are 0%. Your odds are, let’s say 0.000001%. Since you can’t multiply by 0, there’s no way to figure how much higher your odds would be than his.
At least, I think that’s how it works? It’s been a long time since I’ve had to do serious math.
Meg recently posted…I Loathe New York
I have a friend who is an accountant. I would hire her, and charge her with looking into how to anonymously give to some of my friends. I have a few friends who have made mistakes, or had a run of bad luck (which is usually caused by a string of mistakes) and are having money problems. While I would happily help them out, I do not want to be perceived as a bank. “Well, you gave me money before.” Yeah, obviously a mistake on my part… But anonymously, I could give them cash, they wouldn’t know who was giving it (thanks to my little buy a house and back date the sale scheme mentioned above) and would not bother me again. My accountant friend, who is making enough to deal with it, would have to bear the brunt of the inquiries. But since she isn’t a mutual friend, it would be difficult to figure out.
Like I said, I can quite easily convince myself that I have the winning numbers and start planning what I would do with all that cash…
I’d try to conceal my identity, definitely. I have an uncle who manages assets for high net worth individuals, and I’d go to him for advice. Then, in no particular order:
1. Pay off my parents’ debts. Encourage them to retire and move in with us.
2. Get pregnant.
3. Buy a townhouse in Greenwich Village on West 11th street between 5th and 6th Avenues. It is, I swear, the most beautiful block in NYC.
4. Quit my job and have my husband quit his “day job” so he can focus on his musical dreams full time.
5. Bring my in-laws over from my husband’s home country.
Then I’d probably settle down to being a stay at home mom without having to worry about money. I don’t think, aside from the house, there’s much I’d buy.
Meg recently posted…I Loathe New York
I wouldn’t play the lottery in the first place. Not because I’m cheap, but because I don’t want to win an absurd amount of money.
I think it’s pretty standard that when you save your money and subsequently become rich people don’t really think of you as rich so they’d be less inclined to ask you for money as if you won the lottery.
I know good things can come out of the lottery, and some people choose to do good things, but I’d rather not be tempted. If I did win, I’d give away 99% of it, invest the rest and once I found a sustainable quitting point I’d leave work to do whatever I wanted to do for the rest of my life.
Johnny Moneyseed recently posted…Comment on You really, really can save money. Here’s how. Part 1. by Well Heeled Blog
I really like how the CommentLuv plugin said that “Well-Heeled Blog” wrote the post instead of me haha.
Johnny Moneyseed recently posted…You really, really can save money. Here’s how. Part 1.
I would try to keep my identity as concealed as possible but I would tell my imediate family. Mainly because I would make sure my parents didn’t have to work another day unless they chose to, they have worked hard enough already. I’d set up college funds for the kids, nieces, and nephews. As far as working goes I would volunteer all my time for causes I believe in and spend time traveling.
Jennifer @ Money Aches recently posted…Setting Price Goals
I would conceal my identity. There must be a host of negative reactions around a lottery winner toward him or her, and feelings of resentment.
Great question! I would tell only my closest friends, buy some new shoes and then start planning the launch if my nonprofit that would change the world!
CashRebel recently posted…Do You Work For Passion or Money?
Yeah, non profits are fun to think about! How much money do I need to get nuclear fusion going? Probably a lot more than 600 million!