What would you do with a million dollars?

Me? Probably much the same as I'm doing now, except  with a horn section.

"Ah, but the horns, they're blowin' that sound."

Nancy Reading wrote:A million dollars is still a lot of money. If I was able to invest it then I could envisage having $200000 a year income to use. I think you could do a fair amount of good with that (taxman permitting...)!

Standard investing wisdom is that you can withdraw 4% a year without reducing the principle. That's about 40K/yr.

I think, if you were willing to do more hands on type investing and were willing to risks losing your principle, then you could easily do 200K/yr using that million to get into real estate investing. That also takes more research, and most people who do this get their realty license also.

Both traditional investing and real estate are part of my master plan, personally.

Douglas Alpenstock wrote:Me? Probably much the same as I'm doing now, except  with a horn section.

"Ah, but the horns, they're blowin' that sound."

"I should have learned to play the guitar" seems like it would have been more applicable to the thread topic

I would buy an apartment building and retrofit it into a permaculture apartment complex.  If I could get a whole apartment complex somewhere for half a million (that's pushing it I know) I'd retro one part, and then the income beyond my own living expenses would go to slowly fit out the rest of the complex.

A million dollars is not a ton of money and can go fast. I was recently talking to a friend in his mid-50s who just inherited 250,000 dollars. More money than he's ever had at one time, but he expects to live at least 25 more years, so that's just 10,000 dollars a year. So that's not really enough for any dramatic change in lifestyle. A million is 4 times that. So you really need to do something that is "an investment" rather than just spend it or will be gone quite quickly.

Jim Fry wrote:I am probably older than anyone else who has answered this question. In my case, in looking back on a rather long life, my conclusion as to what to do if suddenly having a significant amount of money is, ...

You get one chance to change the course of your family's history. If you are like me, it is not really necessary to change one single immediate thing. A new or newer tractor, a pool, vacation, nicer tools, things, only last so many years, then are "gone". There is only one that your descendants could make use of to improve their lives. Land. Get the best land with the best soil and the best water, in the best surrounding community, with the least likelihood of being overrun by city folks moving in. I would move as close to old order Amish I could. They live as close to self-sufficient lives as is currently happening in the U.S. I would not move anywhere on a line between two cities. Eventually there will be a freeway built between them, and there goes the neighborhood. I would set up a family trust so the land can never be divided. And with the left-over money, I would set up some sort of account to provide the land tax money far into the future. Land is the only thing there will never be more of. If you have land, and work hard, all the other things you desire, covet, want, will come to you. But the land comes first. Keep it safe from government, teach your children to live well and productive, make your best guess to avoid being overrun by new neighbors, and you can hopefully die knowing you did your best for the family you leave behind.

I agree with a lot of what Jim says here, and have done much of it to an extent… many OO Amish as neighbors now, near I-35 and about 75 miles to the nearest major city. 31 acres is a lot to care for, and always about 632 things on the to do list which I care for as possible when I get hometime as a trucker.

The biggest disagreement I have is that land is not the only finite thing, China has been building new islands and some country in the Middle East has also. Not really relevant I suppose… but Bitcoin brings absolute scarcity to an extent that even beats land. We might find more land someday on the moon or Mars maybe, etc. 21 million and no more ever is harder.

With probably 1,000 hours spent learning about BTC through reading, podcasts, etc. I think I have started to get a small grasp on what is money and how absolute scarcity helps people and scares the pants off oppressive governments. Plus, BTC is good for the environment in ways such as using wasted or stranded energy

Cat, it sounds like your teacher didn’t appreciate your wise use of funds.
I’d rather have energy and perfect health than a million dollars, but I wouldn’t say no to a million dollars. I would pay off my debts, set some aside for my kids to travel or go to college if they wish to. I’d buy another vehicle for my family because we’re car dependent. But not an expensive one, and older VW TDI probably. I’d pay someone to help me put in a tall thorny living fence around my food-forest-to-be. Probably buy a big greenhouse. Whatever was left after that would save for retirement and/or to help my kids buy their own  homes in a few years.

well interesting question with many thoughts expressed. one I didn't see yet was.  " go to the liquor store. buy a bottle. sit out front and drink it."
its not quite enough to buy a ticket to the moon. but sure is enough to get a good quality comfortable pair of work boots and few fluffy towels.
what would I do? I dont know? maybe one thing would be to put in a concrete floor with a workshop over it. get a new stove, you know, practical stuff, maybe build a little guest cottage.
I dont know. a long time ago I came to realization even if I won 10 million in lottery I still could not afford to live in port royal, Naples, FL  beach.
I dont think money makes people any happier but mismanaged wealth ive seen very many times leads to chaos and tragedy in peoples lives. it might makes things a little easier to achieve goals and to have a more worry free life but i kind of believe the journey to what you do with the hours of your life is of the treasured parts of life.

Anne Miller wrote:

John Wolfram wrote:  For $11,000 a year (i.e., the advisor fees paid on a million dollar portfolio  most people would learn how to build their own computer or fix their own air conditioner. I know I would.  

I guarantee that if a person has $1,000,000 they are not going to quibble over $11,000 and most people wouldn't want to learn how to build their own computer or fix their own air conditioner.

You must be the exception.

Aren't most of us exceptions here?

I'm one of those "secret" millionaires, and manage my money with the primary goal of meeting my family's needs and maintaining our land without needing further paid employment. I've tried out a few financial advisors over the years, and have not been convinced that they can outperform a good robotrader, certainly not to the degree that they would pay for their own fees and generate additional profits. $11k is $900/mo I could instead spend on family experiences and land and home improvements, all things I value more than a guy who calls me quarterly to let me know my money is still there.

That said, I'm the kind of person who makes spreadsheets for fun and spent the last 10 years playing with calculations to figure out if it was time to quit my job yet. If you don't like numbers, don't trust yourself with large sums, and would rather outsource the whole thing, it's great there are professionals for that.

To the original question, I guess my answer is, "I'd invest it and live on a budgeted sustainable income to maintain my home and family." If you handed me a fresh million, I'd use it to add on a woodshop over the garage, fence our whole acreage, and clear and plant a whole orchard in one swoop instead the piecemeal way we've done it so far. Then I'd throw the rest in the kitty and probably buy takeout once or twice extra per month.

Anne Miller wrote:The first action I would take would be to hire a financial advisor.
Dave Ramsey would be my first thought. ...

If I didn't own a place in the boondocks, that would be my next step.

https://permies.com/t/218512/million-dollars#1851892

To continue what I said above.

Probably my attorney would advise me to use my CPA.

So after paying all the taxes, I would probably divide what is left 5 ways.

A 1/5 to each of these:

Buy a CD at my local bank, (this will be a big windfall for them)
Buy a CD at my other bank in the big city.
Buy a CD at a previous well know chain bank in the big city that I used previously to moving to the boondocks.
Buy a CD at another well-known chain bank in the big city.
Buy a CD at the Bank my insurance company owns that lent me on a car loan many many years ago.

I am going to give folks the best advice I have ever been given by someone who lived thruugh the Depression:  Don't put all your money in one bank.

Here is some more free advice:

https://aspenfunds.us/podcast/how-billionaires-pay-less-in-taxes/

bruce Fine wrote:well interesting question with many thoughts expressed. one I didn't see yet was.  " go to the liquor store. buy a bottle. sit out front and drink it."
its not quite enough to buy a ticket to the moon. but sure is enough to get a good quality comfortable pair of work boots and few fluffy towels.
what would I do? I dont know? maybe one thing would be to put in a concrete floor with a workshop over it. get a new stove, you know, practical stuff, maybe build a little guest cottage.
I don't know. a long time ago I came to realization even if I won 10 million in lottery I still could not afford to live in port royal, Naples, FL  beach.
I don't think money makes people any happier but mismanaged wealth ive seen very many times leads to chaos and tragedy in peoples lives. it might makes things a little easier to achieve goals and to have a more worry free life but i kind of believe the journey to what you do with the hours of your life is of the treasured parts of life.

Well....The liquor part  made made me giggle  Me, and my "ugly half" (no, my husband is not ugly. He calls that himself, as he explained to me, that I am the beautiful and that better half. I'm not complaining LOL I'm flattered), but not to digress....WE do that every evening, reflecting on the day past, what's next, etc.
But you are right. We watched few programs about people who won millions. Most went broke, some invested wisely.
It depends (as someone already have mentioned) on age, what they may already have, priorities and what's important to them.
You mentioned Naples, FL beach (I wouldn't want it, but I'm me), but on the same note, average "chicken coop" in Toronto costs million dollars plus. So yeah, 1 million could leave someone broke from the get-go
But still....it would be nice to dream a little dream while still able and healthy

Roberta Wilkinson wrote:[I'm one of those "secret" millionaires,

It is not a "secret" any longer ....

Not sure who first said that money is the most addictive substance, but that resonates with me.  

I'd look for ways to use it to support perennial edible land restoration efforts that create and protect mega diverse species assemblages while producing lots of super healthy food for people.  Sites that will overflow with massive amounts of biology.  My deep belief is that this world is in great need in so many ways that permaculture can help with and my personal wants are not all that important.  The money would be put into the hands of good folks who don't want money but need it to help propel their work forwards.

New set of tires on all equipment and vehicles, a decent storage barn, a decent shop, gravel for access roads, loads of nursery stock, get my business plan off the ground with a boost, and hire a few helping hands...the rest I'd give to friends and family under slow dispersal thru personal contracts, with mutual interests and applications in mind...like help them start a business.

This is always a fun thing to think about, especially when I allow myself to buy a lotto ticket once each month.  
Like many others, and with the possibility of losing all I have if the company I work for continues to fail, I would pay everything off and prepay my next year's property taxes or stash that in the safe....
Next I would look for a larger property, and pay cash for it. I'm a 'small house, large barn on managable land' gal.  Once moved, I would rent out my existing place. Rental houses are in short supply here.
My new property is next priority - getting completely away from utility companies, but leaving those systems in place in case I want to sell it.
Family and friends have never offered one second nor cent of help in my entire life so I don't feel compelled to buy them anything, but having savings to help them in the future, well that is a possibility.
Since my son will live with me for the rest of our lives, I plan to get him a tiny home near my new house.  
Barns, pastures and gardens as well as back-up power and water supply like ponds and an extra well are next.
And then a shed or garage filled with spare brand new parts for common and uncommon replacements.
Root cellar, safe room or reloading room in basement if possible.
If I could stop working a job and simply sustaining on the rental property and maybe helping others do this as well would be a dream.

I would replace our three working rigs with something electric and new.

I would get a first class architectural design for a new wofati.  And then build it.

I would hire professionals to finish all of our projects.

I would hire somebody to hire somebody to do mega PR/advertising/publicity for the better world book.

Eric Hanson wrote:If the amount were 5 million, I would do all of the above, invest the rest and have a nest-egg large enough to live on interest.

It is possible to live on a rural homestead on just interest from one million.
According to google, 4% interest would give $40,000 a year which, if carefully used over time, should get you close to self-sufficiency.

M. Freestone wrote:Since our community needs jobs, a franchise requires a large net worth to buy the franchise and have cushion when it gets started. I want a hotwings franchise here. I looked it up and was shellshocked how much it costs to start and keep it going.

I understand that want. I love cooking and eating and how food can bring people together across cultures. So much so that I got half way through a culinary arts program in my early 20s. And one reason I only got half way is because restaurants are one of the most likely to fail businesses possible. If I were to invest in a business today it would be one of the "boring businesses" Cody Sanchez talks about on her YouTube channel, all chosen because they have very high success rates.

Paul, Jay and Katie attempt to the same exercise with only half the amount - $500 000 and with two caveats. One, it has to further the cause of permaculture and it has to generate more money, so that it can cover the continuing costs of the project or so new projects can be started.

https://permies.com/wiki/229814/Podcast-Struggling-big-spend-Part#1983853

Buy a dozer and an excavator and then $916,399.08 worth of land.

Roberta Wilkinson wrote:

Anne Miller wrote:

John Wolfram wrote:  For $11,000 a year (i.e., the advisor fees paid on a million dollar portfolio  most people would learn how to build their own computer or fix their own air conditioner. I know I would.  

I guarantee that if a person has $1,000,000 they are not going to quibble over $11,000 and most people wouldn't want to learn how to build their own computer or fix their own air conditioner.

You must be the exception.

Aren't most of us exceptions here?

I'm one of those "secret" millionaires, and manage my money with the primary goal of meeting my family's needs and maintaining our land without needing further paid employment. I've tried out a few financial advisors over the years, and have not been convinced that they can outperform a good robotrader, certainly not to the degree that they would pay for their own fees and generate additional profits. $11k is $900/mo I could instead spend on family experiences and land and home improvements, all things I value more than a guy who calls me quarterly to let me know my money is still there.

That said, I'm the kind of person who makes spreadsheets for fun and spent the last 10 years playing with calculations to figure out if it was time to quit my job yet. If you don't like numbers, don't trust yourself with large sums, and would rather outsource the whole thing, it's great there are professionals for that.

To the original question, I guess my answer is, "I'd invest it and live on a budgeted sustainable income to maintain my home and family." If you handed me a fresh million, I'd use it to add on a woodshop over the garage, fence our whole acreage, and clear and plant a whole orchard in one swoop instead the piecemeal way we've done it so far. Then I'd throw the rest in the kitty and probably buy takeout once or twice extra per month.

Hi Roberta.
I'm another exception.
I've listened to hundreds of hours of financial independence (FI) podcasts this year.
I've seen a financial adviser but decided he gave me the wrong advice (wrong for me, right for him), so did my own thing. My wife, who is in a zero tax bracket, buys units in ETFs (exchange traded funds).

My cousin will graduate from high school soon.  Instead of heading to the beach to drink alcohol (we call it schoolies, in Australia) she wants to come to our homestead to work with our animals and learn to invest. So another exception.

I have devised a way of guiding my children to become wealthy and managing their own money:

Each day, they get a score out of 10 for each of 5 areas:
•homeschooling
•homesteading
•home-making
•happiness (getting along, not annoying siblings)
•helpfulness

Highest possible score is 50.
We will divide their score by 5, and pay them that many dollars.
50% must go towards an ETF portfolio.
However much of the remaining 50% they choose to allocate to their portfolio, we will double.

$15 per day is therefore the maximum amount possible.

At $10 per day invested, and 7% annual growth, I expect them to have $49,000 in 10 years. A powerful lesson.

If they continue this for 46 years, I expect their portfolio to be over $1,000,000

https://www.investor.gov/financial-tools-calculators/calculators/compound-interest-calculator

Obviously, a better strategy for them is to invest much more at a young age to reach their FI number (portfolio size required so that 4% withdrawals will cover their expenses) sooner.

I suggest listening to the Choosefi podcast.

I also suggest low cost index funds. Performance comes and goes, but fees are forever. Apparently, over a long investing timeline, a 2% annual fee can eat half your portfolio compared with your portfolio had you invested in, say, 0.05% annual fee index funds.

Another way to look at the $11,000 annual fee on a million dollar portfolio: if living on the 4% safe withdrawal, that's more than a quarter your passive income of $40,000.
Effectively, you gift over a quarter of your portfolio.

Isaac Jamieson wrote:

I have devised a way of guiding my children to become wealthy and managing their own money:

Each day, they get a score out of 10 for each of 5 areas:
•homeschooling
•homesteading
•home-making
•happiness (getting along, not annoying siblings)
•helpfulness

Highest possible score is 50.
We will divide their score by 5, and pay them that many dollars.
50% must go towards an ETF portfolio.
However much of the remaining 50% they choose to allocate to their portfolio, we will double.

$15 per day is therefore the maximum amount possible.

At $10 per day invested, and 7% annual growth, I expect them to have $49,000 in 10 years. A powerful lesson.

I don't understand how you go from a max score of 50 divided by 5 equals a max of 15? I get a max of 10...?

Hi Cat.
Thanks for the question.

I wish for them to invest,  and observe how it compounds over time.
Thus the required 50% of their total earnings must be invested.

However,  I wish to take it one step further.

I want, by the time they mature, for them to have CHOSEN to invest.. Many many times. A good habit.

Therefore, for the 50% that they control, I double the amount they choose to invest.

Like an employer match on a 401K in the US, I suppose.

Therefore, the maximum amount initially is $10. However, if they choose to invest the $5 they have control over, they get the "employer match" just on that $5. Therefore the total would be $5 + ($5 × 2) = $15

I would purchase property, permie the property and set aside/invest the rest for me and my progeny and their progeny.  

Great Question and like most others, I can spend a million in a heart beat!

Unlike others, I have no desire to put any of it in a bank of any form other than the "TimeBank" I am implementing and probably an easy $100,000 could go to website, background checks and salaried stewards of said bank!

So here is my current needs/expenditures for a regenerative ecovillage that helps travelers (nomads):

  100,000     Payoff Mortgage of 120 acres in NE Arizona
  150,000     Event Center made with natural materials (lower 40)
  100,000    Community Facility (upper 40)
  150,000    Off-Grid Solar Systems with wind back up.
  100,000     Water catchment, storage, filtration systems
    70,000     Fence said 120 acres because Arizona is a free range state
    50,000     Remodel 3 mobile homes w/eco/sustainable improvements
    50,000     River Rock for roads
    30,000     Excavator  with attachments
    15,000     Skid Steer with attachments
    20,000     Property truck 1 ton 4WD
      5,000     Utility Vehicle 4WD with trailer
    90,000     Legal, Accounting, Permit fees, insurance, website, marketing, TimeBank
    40,000     Food animals, corals and housing (including female Camel)
    30,000     Misc. tools/equipment for brick making, organic gardening, etc.
1,000,000  All spent... can't take it with me... now to start earning... who wants to join?

Kinda went about this whole thing with property first... AND am helping others and doing this even though I do not have the million!
LunaGaia Nomadic Village in Chambers Arizona

Well here in The States if I got a million dollars I'd only actually get 600,000 because taxes.  So the real question might be what would I do with 600,000?  We'd buy a little house with a bit of property and we'd try to get a zoning veriance to add more houses on it, some tiny homes, maybe a couple of other small houses, some RV pads.  Build some sort of commonhouse.  And get an intentional community going here in Clackamas County in Oregon, or possibly Washington County.  And then other friends could buy land adjacent to us and we'd expand the community that way and they could do the same thing on their property (minus the commonhouse.  And we'd definitely have a hot tub, and we'd be within walking distance of a river or large stream for fishing/swimming, though it might not be on our land, we'd see.  And we'd have a blacksmithing forge! and grow things.

I'd pay off all of my remaining debt (insubstantial, but I'd still do it). Then I'd put the remainder in a low-risk investment that cut me a check for dividends/interest on January 1st of every year.  That's pretty much it. It would preserve the capital in case something expensive happened beyond the ability of my yearly income check to handle, and would provide more than enough $ for normal everyday living expenses. Four money market funds would insure and protect the entire investment. Actually each one could provide a check every three months. I already have a few income streams, so the extra yearly cash infusion would allow me to do pretty much anything I want, including charitable donations, etc. I wouldn't need to suck an entire "paycheck" out of it, so I don't care if it only paid three percent. That would be $30,000 per year. And that would be fine by me.

Pay all debts, forgive all debtors.

Pay for a bit of help to get all the renovations done on our place.  An indoor toilet and a good reed bed system would be kinda awesome.

Similar for my son's place next door, unless he wants to do it all himself.

Let my other half choose his dream car. Won't be as expensive as you think as he wants an old one to tinker with.

Bribe Matt Walker to work with my other half to design a set of plans for a rocket powered cook stove and heater system using materials available here, in local sizes, and release them as open source. Maybe get a dedicated forum here to help people who are building from the plans.

See if there's any way I can get an official seal of approval on said plans.

Once the house is renovated, clear out the shed and renovate that so it can be a workshop for my other half. Then kit it out for him.

Get a camera to automatically record any trains that pass so I don't keep missing the interesting ones.

Get my book finished and published.

Trip out to the US with my other half to visit Paul and the lab. It's been years since I've been there and I want to see the changes, and let my other half get the feel of what it's all about. They should meet, too. Two of a kind...

Buy a little place nearby to renovate and find someone who'd like to live there in return for some help in the garden.

Find or create worthy projects to support.