Would a thousand dollars meaningfully change your life? Would a million? Would your assessment vary if it taking away money that you already have vs giving you more?
I start to think about some saying about wealth occurring when you don’t particularly want what you don’t have?
I’m guessing that for most here a thousand up or down would be an annoyance but not life changing. That for a chunk a million up would alter retirement planning but that their lifestyles would actually change fairly marginally. But that losing a million, or lacking that as much as they have, would hurt lots more.
And that’s actually a fact, I just sold a house for that amount to buy a condo. The equity came out pretty good, so I’m now in the best financial shape of my life. Bi-weekly mortgage payments and bi-weekly double-up payments on the condo are covered for about 3-4 years, plus annual lump sums of 10% of the original mortgage balance. That pays off the condo pretty quickly. Out of my monthly income, I only have to cover the condo fees, which are less than half of what my mortgage used to be on the house, so I’ll be able to roll a lot of that money into savings, and feel no difference in my lifestyle.
More money in the bank wouldn’t change anything for us, as we’re pretty well set, financially. It would certainly change my kids’ lives, as that’s where it would likely go.
In the sense of basic living conditions or financial security, we’re pretty secure.
What would change my life would be enough money to quit my job tomorrow/retire (however you choose to label it) and do what I want.
It seems like there are two levels of this.
The first would be essentially enough to retire at 53 with the same standard of living I have today, or that I’d have in retirement. Not really a sea change in terms of lifestyle, activities, or cool stuff, but just enough money to not actually have to work for a living anymore. That’s probably in the neighborhood of 5-10 million, I’d guess.
The second would be enough money to achieve the first as well as have enough to materially change how I live. So enough to travel wherever I want 3-4 times a year, drive new cars, have a second (or third) house elsewhere, have the latest gadgets and tech that I feel like checking out, and so forth. That’s probably more in the ballpark of 15-20 million, I’d guess.
One thing to consider is that depending on your particular circumstances, you may be financially better off investing your money, and paying off the condo at the normal pace. The idea here is that sometimes you can make more investing than you pay in interest, so over time, you actually make more money than if you’d paid the debt off as fast as possible.
We’re getting by well enough but not yet homeowners. $500k would guarantee my son’s education and substantially help with the cost of a house. It would help bridge that gap between where we are in retirement and where we should be, optimally.
But of course, this all happened right when Trump decided to trash everything. I’m likely going to invest the cash in something I can access easily to make the payments, so most of it would produce revenue for a few years, but I’ll have to wait to see if the market keeps tanking. Right now, cash in hand is probably the better idea.
Whatever it would take to buy us (or one of us individually, if one of us goes sooner than expected) premium care when we are no longer able to care for ourselves, whether it’s in-home assistance or a place to live where everything is included. The best available, the kind that only rich people can afford. Enough money to last at that level for as long as we care to and are able to continue our lives. I don’t know how much that would be, or what is realistically available, so I can’t put a figure to it.
I live off disability benefits and public health care.
A small windfall would probably hurt me financially because it would disqualify me from getting health insurance and would NOT be enough to pay for me medical needs out of pocket.
In the new Millionaire for Life lottery game the top prize is $1 million a year for life and the the second prize is $100000 a year for life.
Since I have no spouse or children I could live comfortably on $100000 a year.
On $ 1 million a year I could live fairly luxuriously.
I currently live month-to-month on Social Security. I’m lucky to own my house and vehicle, so I have no long term debt to speak of, and I have money in the stock market if I need it. Could I use more money? Sure, who couldn’t? If I were given $500,000 I would add it to my investment account and never have to worry about money again. I could probably even afford to go on a nice trip once a year.
An extra mil would offset some of trump’s depredations to my portfolio. So would be a form of insurance.
So I suppose I can say the extra $1M would increase my confidence I’ll weather the future without concern. But it’s not gonna change my semi-extravagant lifestyle.
Somehow giving up a mil in an anti-windfall (not just investment volatility) would be the opposite. It’d start to shake my confidence that I could weather any storm unfussed. Might lead to me dialing back a little until the financial future of the USA is less under attack.
Tack another zero on there and now it’s life changing money. In either direction: good or ill.
I’m extremely frugal. Even $400,000 would be enough to let me retire early right now, if I put it all in an HYSA and moved abroad to a very low-cost place, and still earned little bits of irregular income here and there.
One million dollars is more than I expect to have in retirement accounts for both my wife and I when we hit 65, if nothing else changes for us. And, there are a lot of decades worth of inflation to eat away a bit at the usefulness of that projected 401k value. Who knows what real estate will do in that time, but adding the asset of our house (which won’t be viable as a home in our old age for a number of reasons) we will likely be worth more than a million dollars at age 65, but definitely south of two million.
So, one million would be life changing. Half that would be life changing.
There was a time in my life where $10,000 would have been a godsend. Later, I recall thinking $100,000 would change everything. Now, we’re set (thankfully) and now it would take quite a lot to change our extravagant lifestyle. As others have said, it would probably only help our kids or charities at this point.
We get money sometimes, that we didn’t earn, sometimes a pretty substantial amount that would be life-changing for other people. It goes into investments. We don’t have any debt. After years of putting that stuff into investments we’ve finally got enough, and enough income, that we can afford to buy a house. And probably will this year.
And owning a house is kind of the last thing on the list. After that, it’s just more investing. Less interesting, I suppose. But we’ve always led fairly modest lifestyles and I doubt that will change much. If someone handed me $5m today I still don’t think I’d spend more than $450,000 on a house (I live in a high COLA and the median home here is $350,000. So it would be a bump up from median, but not extravagant.) We’d probably just throw the rest into investments.
Sorta, yes. Not in any life-changing way, though. More that it would pay off my mortgage and have plenty leftover that would mean I can live my modest middle-class lifestyle for the rest of my ever-shortening life without ever being concerned by serious money stress. Suddenly need a new car? Covered. Want to remodel my kitchen? Covered. Want a new camera lens or two? Don’t have to think - covered. Have to move into a nicer retirement community when I’m no longer capable? Combined with my retirement income and now paid off home equity, hopefully covered. Et cetera.
These are all thing I can manage now over time. But I have to think, plan, prioritize and delay. An extra million in liquid assets would dramatically reduce the need to do as much of that.
Yeah, and I think that counts as life-changing. If you go from having to worry about money to never having to worry about it again, life-changing.
(I think it would take me about $2m to get there because I have to make sure my son’s covered after we go, and I’m not sure what his current needs will be in adulthood.)
Right now, I have caregiving responsibilities that I can’t easily hand off. I have enough generational wealth that I’m not living paycheck to paycheck.
So neither the thousand or the million would immediately change my life.
Although the million might make my choices in five years more fun and more varied.
At this point the only thing meaningful in terms of money would be adding enough to significantly increase our contributions to charity or to found some kind of non-profit. I’m not sure how to put specific $ on that.