$1,000, $10,000: no change. In the latter case retirement bumped up by a couple months.
$100,000: Buy my future retirement home and retirement bumped up by a couple years.
$1,000,000: Buy my retirement home and immediately go into semi-retirement.
$10 million: Is this tax free? If so, then buy retirement home and vacation condos in Colorado and Florida (which I could then rent out when I’m not using them.) If not tax-free, then same as $1million except I wouldn’t have to work.
$1,000: No change
$10,000: finish paying off school loans and pay for my vacation this year.
$100,000: same as $10k, plus a down payment on a condo. The rest into savings.
$1,000,000: I’d have to think about this one more. Probably not enough to retire, but I could definitely make a career change to something I’d enjoy more. I could’ve gone for a PhD earlier this year. I’d pay off the loans, but hold off on real estate until I decided what to do.
$10M: I’d retire and travel. Probably a couple rental properties for income and low cost index funds for long term growth. I’d learn to sail and scuba dive. Lots of eating new things in new places. Probably some sort of financial support for my brother and sister.
Check carefully that all relevant taxes are paid first. Then -
$1,000 - no impact. An upscale date night with the Lovely and Talented Mrs. Shodan, moderately expensive presents for her, the kids, and me (probably an expensive cigar and some books).
$10,000 - no real impact. We could redo the deck.
$100,000 - That is the cusp amount. Too much to waste, not enough for any major impact. All of the above, plus pay off the car and invest the rest.
$1,000,000 - All of the above, plus pay off the mortgage. Invest the remainder, but not quit my job just yet.
$10,000,000 - This isn’t quite Fuck You money, but it’s close. Meet with our financial guy to see how much we could reasonably expect for a minimum yearly income, after taxes and without touching the principal. Continue with my job - I like it here, and it gets me out of the house. Live on my salary for the next five to seven years, but take four weeks of vacation every year and go on cruises and suchlike. Then retire and live a life of idle dissolution.
Regards,
Shodan
$1,000 - New wheels for my car
$10,000 - furniture and rent payments for new apartment
$100,000 - student loan repayment, car repayment, new furniture, some stuff for my gf…
$1,000,000 - This is where I stop knowing what to do, vacations once every few months for sure
$10 million - ??? no idea, $1m towards fun and paying off bills, $9m invested, live off the interest.
**$1,000: ** Probably gets dropped into the vacation fund savings account without further change.
**$10,000: **Combined with savings, enough to pay off a debt that would improve monthly cash flow a little bit.
**$100,000: **Pay down the mortgage enough to refinance and drop the PMI. The monthly savings probably leads to a nice vacation and doing some things around the house, like going to all hardwood floors, and paying professional painters to finish the work that we’ve started. Eventually, have the rest of the basement finished, and buy the pinball machines and shuffleboard table. Oh, and get a back-up generator.
**$1,000,000: **Pay off the mortgage. While not enough money left to retire on, consider whether a career change is desirable. A significant cruise vacation would also be in order.
**$10 million: **Pay off the mortgage. Leave work and spend a year traveling (depending on whether or not my wife also quit). Spend my days split between volunteer work, bowling and playing tennis.
1K, 10K, 100K, would just go in the bank along with the rest of my money. A modest inheritance nine years ago hasn’t been touched yet.
The higher amounts would not significantly influence my current lifestyle, but would go a long way toward getting some friends/family over a financial hump. I can’t imagine a situation where I’d ever need that kind of money myself, but it would be nice to know it is there.
I live on $15K a year pension, and there isn’t anything I wish I had (that money can buy).
$1,000: none
$10,000: minor
$100,000: I don’t need it, so likely not a whole lot. Perhaps I’d buy new cars to replace the junkers my kids drive.
$1,000,000: trust funds for grandkids and some charity donations
$10 million: Provide retirement money for my kids, pay off their mortgages, college funds for grandkids. At nearly 70 years old, I have no need for large sums, so would try to use the balance for the good of humanity.
Have you considered getting it stitched in place?
I’m surprised to see so many people mention debt.
Borrowing money to buy a house makes sense, because you get to live in the house and thus save on rent if you get a mortgage. You could make a similar argument for a first car. But why keep buying cars with borrowed money? Or put stuff on credit cards?
$1,000 - no impact at all.
$10,000 - no impact at all
$100,000 - possibly replace the beat up car my kids “have to share” with two used cars that aren’t so beat up. And replace my car. I really don’t like my car, and can’t justify a different one based on “I can’t find a black sedan in a parking lot.”
$1,000,000 - put it in savings - no impact on day to day life - might take a nice vacation. I suspect my husband would insist on the Tesla he wants.
$10 million - put it in savings - my husband might cut back on work hours - he’s part time already. Set up trust funds for the kids.
Rule of thumb - 4% that you’ll have to pay taxes on. That assumes an average 8% return and 4% inflation. So $400,000, of which plan on 50% in state and federal taxes, for take home of $200,000. You can do that - if you aren’t going on a hookers and blow bender.
(But get rid of the financial guy - he’ll take a cut off the top - just a Vanguard index fund - maybe a Vanguard bond fund)
Pretty much what the OP just said:
$1,000 - Meh, I’d just toss that into savings for the next time my property taxes or homeowner’s insurance comes due.
$10,000 - That’s better, that would pay off my credit card debt with a couple thousand left over, which I would again just drop into a savings account for some rainy day, large, unforeseen (or planned for) expense.
$100,000 - This would be a bit more of a game changer. 100K would pay off my main mortgage and my HELOC, so that would free up an awful lot of money on a monthly basis to be able to afford to pay off other debt quickly (credit card, car loan)
$1,000,000 - I could pay off everything and still live off that for quite a long time. Would seriously consider how to leverage that to start up a business (do something I actually love) or just buy a house or condo at the beach and drop down to part-time work that just sort of makes me feel useful.
$10 million - Easy. Retire early, pay off all the things, set up my immediate family, live at the beach, and travel much more to reconnect with friends and family.
Seriously? You actually expect what percentage of Dopers here to be wealthy enough to have absolutely no student loan, credit card, or auto loan debt?
You know why I keep buying cars with borrowed money? Because I barely make enough to have $20-30K just laying around waiting for me to buy my next car. Oh, sure I could buy used, but then I still don’t have $10K laying around to pay cash for a used car, so if I’m going to finance, I might as well finance as new a car as I can to keep maintenance and repair costs down.
And most people are budgeting just tightly enough so that, if the dog eats a slipper, gets a blockage, and ends up requiring a $4000 surgery, or some drunk smashes into your car while you’re underwater in the loan, or someone in the family gets a dreaded disease or chronic illness and medical insurance doesn’t hold out… You know what? I’m actually a little bit furious that you obviously live in such a fucking bubble that you can’t imagine that we all don’t have enough money to not incur any debt other than home mortgages and you even have to ask that question. What, do you live in a cave or something? Do you have zero empathy at all for people who are less fortunate than you obviously are? WTF, man?
I have children, expensive ones. It will take a bit to make a difference.
$1,000 - no impact at all.
$10,000 - no impact at all
$100,000 - Maybe a Tesla SUV?
$1,000,000 - Pay off mortgage. put the rest into retirement, or perhaps a big boat.
$10 million - all of the above, and start giving a lot away. Probably stop working full time.
I don’t drive so I’m not entirely sure how all of this works, but wouldn’t it make sense to keep driving your old car a bit longer and save up some money for the next one? That way eventually you can pay for a car from your savings and save a whole lot on interest and fees.
I guess I’m out of touch with living from paycheck to paycheck because I don’t have any paychecks. When I became a freelancer my first priority was to save enough money to cover lean times.
Man, can’t believe the people that can say $100,000 wouldn’t change anything. That is a pretty big change where I’m from.
$1,000 - almost pay off the medical bills from the abscessed tooth I had a couple months ago.
$10,000 - Pay the medical bills & credit cards, leftover goes into savings for eventual home renovation. (If I ever stop getting sick.)
$100,000 - Out of debt completely, major repairs to home, save the leftovers.
$1,000,000 - No debt, year down the house & build new, new car (my 98 Civic is wearing out.) invest the rest.
$10,000,000 - New house, pay sister & mom’s debts, easily live of the interest.
What you are really not grokking is that most of us do not make enough money, after covering necessary expenses, to save up for a car to pay cash each time. When you trade a car in, it has half or less than half the value at which you bought it. Even inexpensive cars run in the $20,000 range. Let’s say you can get a used one for $12,000. I drove my old car for 17 years. The money I saved after I paid it off went toward the downpayment to buy my house.
How nice for you that you have such a buffer that you do not have to fuss over such details in your life.
$1,000 - No change.
$10,000 - Little change, we’d pay off something.
$100,000 - Big deal, we would be able to pay off everything but the house.
$1,000,000 - Could pay off everything, and I could stop working whenever I felt like it.
$10,000,000 - I’d leave work this minute.
I’m 50. My house is basically paid for (I have a mortgage for leverage), there are no car loans and no credit card debt.
Once you get the house paid for, and the debt paid off, and move to cash to buy new cars and get the washing machine replaced - and then save the money you used on debt service so that you aren’t incurring new debt, the point at which $100,000 isn’t life impacting happens pretty fast. And ideally, you should be in that spot before you retire - this board swings older.
At that point $100,000 isn’t going to change your life - you can buy a new car, maybe a nicer one than you budgeted for. You could sell your home and move into a different area or neighborhood - that might be life changing. You could take a nice vacation or five or ten. But it isn’t enough to quit working. And you probably aren’t that interested any longer in finally picking up that Masters.
My parents inherited about that much when my grandfather died two years ago. They went to Hawaii for their 50th wedding anniversary and did some work around the house. My Dad traded in his car for a newer model - one that will last him the rest of his life rather than one that he’d be replacing five years before he stops driving.
I’m at the very brink of retirement - the only reason I’m not retired now is that my boss made me an offer I can’t refuse, which I’ll discuss when I finally do retire all the way.
1,000 - no impact at all. Probably put it in the checking account to be sent off to our savings at some point.
10,000 - I’d buy myself an expensive Lego set, my wife would get something expensive if there is anything she wants, and the rest goes into savings. We could afford this now, but as the behavioral economists say this this new money goes into a different mental bucket.
100,000 - Same as above, but we might also buy stuff for our kids who don’t really need it now.
1,000,000 - pay off son-in-law’s law school debt (maybe over time because of the gift tax). Two days ago I’d have said take one of those European cruises, but I just found that we can do this for just over $100 a day, which is affordable now.
10,000,000 - Start flying first class. This is the only level that would actually change anything much.
The last two amounts would also lead to us giving bigger chunks to various charities like local food banks and the library - where it would make a big difference.