OT - You Just Won $447 Million Lotto, What do you do with the $?
Mates,
It is OT season, we are in a desert wandering without content except for the couch fire in EL, and that is a bad ju-ju. I noted that the Powerball Lotto hit for $447 Million and the winner hadn't come forward yet - I assume it is one of you. So the question today is a simple one:
You've won the $447 Million Powerball Lotto, what are you going to do with the money?
XM
I invested an inordinate amount of time thinking about this the last time we had this discussion on the board a few years back. So here is where that time investment pays off.
Behold, my cut & paste of my previous ridiculously long analysis of what I'd do:
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I own my own little law firm and like my life generally. Live in a nice town and like my circle of friends/hobbies. I'd basically just do what I am doing but just "more". Specifically though....
Phase 1: First I'd put the signed ticket in my safe deposit box and tell my wife about it with strict instructions to not tell anybody else. Then I'd head to downtown Chicago (I live in the suburbs) and hire some insanely high end law firm to advise me on how to properly claim the money for tax purposes and to coach me up on living trusts, gift taxes, charitable trusts, etc. and to give me reading materials on these topics.
Phase 2: give my current clients and other colleagues some BS excuse about a family emergency and go to a luxury secluded Caribbean resort on my own dime for a few weeks with my wife to get away from the hustle & bustle to map out what our plan would be to claim the money officially, along with deciding whether/how to set up a trust for our extended family (parents adult siblings cousins nephews etc). Basically get all our ducks in a row prior to claiming the cash.
Phase 3: claim the cash and brace for impact.
Phase 4: immediately pay off all debts and mortgages, dump about $100K into a savings account, and set up auto debits for 100% of my recurring bills so I wouldn't have to worry about that for a year or two. Have a family meeting or send out a letter to all family members outlining the terms of the family trust (if any). Hard and fast rules very clearly stated up front and adhered to so when Cousin Vinny tries to get a second bite at the apple for a "loan" he knows right up front he'll be denied.
Final Phase: designate a relatively modest amount of cash for "mad money" maybe $100K for my wife and I each, but then. lock the vast majority of the cash away in a very low yield and safe investment portfolio that is relatively illiquid for at least a year or two, then mostly live off of our current income (but with no overhead due to prior debt payments).
My theory is that people flip out and go crazy not due to the size of the money but due to the sudden increase and they don't have the know how or infrastructure to deal with all of the complications. Over the course of maybe 10-15 years, I would slowly increase the amount of investment income we allow ourselves to access so they we acclimate ourselves to being insanely wealthy over time & never touch the principle. Maybe design and build a dream house 2-5 years later and 8-12 years later start to buy other properties, vacation homes, fractional jet ownership etc. by dipping into some of the principle, but never below a certain floor like $50M-$100M.
About Friends & Family specifically--- I would definitely do a family trust for my siblings parents nieces nephews etc but it would largely involve debt relief (from current credit card debt as in "this is your chance for a one time bailout so develop a budget going forward now"), tuition payment, and maybe an annual family gathering at a nice resort. I'd obviously pay the freight occasionally for friends to come on vacations with us.
But as far as "helping friends and family out" so they don't have shit jobs, etc---I think that's exactly the kind of things that make the lotto winner go broke. If there aren't hard and fast rules that everybody knows up front you will get fleeced to death. You'd be amazed at how many "friends" you will get or how "in need" some of your current friends become once a pile of $180M in cash shows up. It's either endless business plans proposed by siblings friends or cousins, sob stories, or you end up putting friends/family on a payroll for invented do nothing jobs.
But my concern is that it will never end. And in my experience, once you are paying somebody continuously (as opposed to a one time only single payment with no strings), it injects an odd power imbalance that creates resentments from the people on the receiving end of the money. If you "hire" them or somehow have them "on the dole" then you put yourself in a position where you might have to "fire" them one day. Or at least be tempted to lord the payments over them in a bizarre controlling type of dyamic. The "you've changed and only hang out with rich friends" thing likely happens because the wealthy person doesn't want to continue giving cash to friends who are harping on them all the time. And hanging out with other wealthy folks is at least one way to make sure that your friends aren't hanging around you only to mooch off of your newfound wealth. Plus, in order to actually enjoy your wealth without constantly paying for your posse of friends to come along, you either need to start vacationing alone, or you start naturally hanging out w/ other people who can "keep up" financially. It isn't that you dislike or hate your old friends--it's just that certain activities it's super awkward to do with them around--either because they can't afford it or because you're always footing the bill.
And if we're talking about the level of cash the OP stated (original post back in 2015 was like $700M lottery or something), lump sum after taxes you're talking about $200M. I'd ease myself into that money slowly. The first few years $500K or $1M annually would feel like a lot of money. Half of the endorphins you get from "winning the lottery" isn't the actual money--it's the DIFFERENCE between the money and your old life. But eventually your mind & body gets used to that new level. Like a drug, you need a higher and higher dose to feel the same effect. So doing a slow ratchetting up would stretch out that "winning the lottery" feeling over a 10-20 year period rather than just getting one massive surge at once. Plus it buys you time to adjust & develop infrastructure (consultants, tax attorneys, etc) to help you responsbily handle that amount of cash over time).
Eventually I'd dip into principle with a floor of $100M. You can't take it with you, which is why I'd eventually blow $100M on a few properties, some small business ideas I have, charitable/political efforts, etc. But the reason I'd try to keep a base $100M in principle is because I have kids. I'd love to be able to set them up with the money IF I can successfully make sure they won't become cocaine addled trust fund losers.
Oh and final phase: worry like hell and consult child psychologists for advice on raising kids so my infant daughter and other future kids don't turn into spoiled brat trust fund kids with drug habits because their parents got insanely lucky in the lottery but didn't bother proactively managing the entitlement/winner's guilt problem that trust fund kids can get.
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/End cut & paste job.
I would invest half of it in low risk mutual funds and then take the other half over to my friend Asadulah who works in securities.
I think that is the most popular answer.
1. Indoor/outdoor club level seats
2. House in Park City, UT
3. Trust for the kids
4. Take care of the parents/in-laws
5. Quit current job and work 4-day weeks for Innocence Project
a Michigan football spring trip
$447 million on black please..
"16 RED"
Son of a bitch. Back to work.
Win the University of Michigan contract, and finally be able to buy Michigan Apparel in a 3XLT,
Pay off my debts, invest in real estate, and then do a ton of hunting.
I would have a villa on the cliff bluffs of Spain overlooking the Mediterrainean Sea and you would never see me again*.
*except for maybe the occasional Michigan game.
Invest in several Vanguard low cost tax free bond funds, take a few art classes and develop a bunch of new hobbies!
If tax avoidance is your goal, you'd be better off owning local muni bonds themselves instead of the bond fund. That way you can control the timing of any sales to avoid cap gains taxes and ensure double tax exemption by buying bonds issued by local entities instead of a portfolio of bonds across the country.
How would one go about doing this? Can I do it through an online broker, if I'm a noob at municipal bonds? Or do I need an (or their) offline services?
I feel like this is an off topic thread every year.
Anyway, I would first give enough money to my parents to retire (My father retired a few years ago, though) and comfortably live the rest of their lives without working, unless they want to, of course. I'd also give some cash to my siblings. Then I'd pay any debt, which isn't much at all right now for me. I'd buy a new car. Then stash some money in some kind of college savings account for the two kids. I'd schedule a two-week vacation somewhere exotic. Then I'd stash the rest.
1) Start a reality show, preferably with a network like E!
2) Do stupid shit and develop a catch phrase
3) Merchandise my crappy stuff at Macy's
4) Insult whomever the POTUS is
5) Run for POTUS with foreign money
6) Win
7) LOL at the USA
8) ...
9) Profit!
Or 2 chicks, 1 cup?
I would take the money and pay smart people to build a few ideas that I'd want to patent and push to market. Even if I took $5mil to do that, I could go from being worth $300mil to a billionaire with the right idea and planning.
Holland, Petoskey, or Traverse City.
Buy my brothers and parents houses and a car of their choosing.
personal trainor and chef to get me in top notch shape (working on this by myself now)
Buy a volvo SC90, Jaguar F-Pace, Sports car (boxter, Carrera 4s, or Vantage), and my grandpas old Jag
Buy a boat to sail (plan on buying a small sunfish in near future), and sea doos
Buy a suite for 10 years at Big House for Motts families to use and for me.
Do responsible stuff like invest and set up college funds for all my kids and nieces and nephews.
Travel. I want to travel to lots of places in Europe.
Probably tons of different donations to lots of different things.
Pray the money doesn't ruin me, my wife, or kids
Make Dan Blizerian look like Mother Theresa.
Open the biggest no kill dog rescue in this country. Buy a plain for transporting dogs from high kill areas to places in need. Go off the grid to most everyone. The best Bourbons and Whiskeys I can buy so everynight me and the dogs can just relax. I truly would be happy.
publish a list of people who could kiss my ass, then I would never be seen again as I would purchase an island where I could be away from everything!
1. fund every food account of every student in the school district of my kid's school for the forseeable future
2. Pay off all debt
3 . Donate to American Cancer Society because f*ck cancer
4. Put enough aside to retire comfortably
5 . anything else I feel like doing at the time.
I would probably pay off my house and some various debt, invest most of the rest, retire mysteriously from my current position and become an itinerant nothing essentially. I try to leada fairly simple life, although my wife would tell me to go back to work eventually after about the third day of looking at me merely accept daytime TV for the crap it is.
They know how to spend it better than me anyway
1. Buy my wife a tropical island
2. Buy myself a 600+ acre property somehere in Michigan complete with my own golf course, fishing, hunting, 4-wheeling etc.
3. Spend time traveling in my private jet/helicopter between those two properties based on weather and whatever was going on.
4. Give a bunch away. Secret Santa. Walk into a store dressed as Santa and hand out $10,000 to all the shoppers
5. Put a few million in a trust for my kids so while they still have to have a career, they'll never struggle for $
6. Lifetime season tix (4-6 seats) for the Red Wings, Lions, Tigers and Michigan Football, BBall and hockey.
7. Travel the world.
8. A harem of chicks (and blow) at the same time
Find WD?
Or go to any non-revenue UofM sporting event. He'll be the guy there wearing maize and blue checkered pants, NTTAWWT.
2) Take a several month to a year sabbatical, traveling wherever I want
3) Open a string of several no kill dog shelters, and put them out in huge plots of farm land so the pups have several acres to run around in.
4) Buy out / shut down Puppy Mill
$447 million will cure your introvert-ness
I think I'll buy my own college football team. The Akron Zips can't be that expensive.
It's what we do now and what we work to do. We just wouldn't need to age ourselves with high stress anymore. I'd also probably purchase a small jet or fast prop for our annual trips to Alaska. Other than that, no real changes or acquisitions. At death my preference would be to donate the remainder to Michigan, specifically, the physics and engineering departments, her school already holds the largest university endowment.
Start company called 'Little Brother'
Buy naming rights at staee stadium, and plaster advertisement sign there for ... well, eternity.
Also, buy the next door house to coach.
Last, buy a suite at the Big House, for ... well, eternity.
In one of Elmore Leonard's books he had a rich old guy that would have two hookers dress up as Michigan cheerleaders while he watched Michigan games. I'd buy a box at the big house and do the same thing, but at the stadium.
So basically two chicks at the same time.
suprisingly modestly, find great joy in giving to others both known and unknown, travel, travel and more travel. Live for a few weeks at a time in various places such as Seattle, London, New York, Chicago etc. to drink it all in. Set up various trusts and possibly charitable foundations for things close to my heart.
Pay handsomely to those who find my families historical roots in Europe and wherever else. Visit those places with great pleasure.
Two chicks at one time also sounds nice though.
I don't think you need to win the lottery to do that last thing.
I cant afford a kid right now