What Would You Do with a Million Dollars?
It's easy to imagine scenarios where receiving a million dollars could change your life and the lives of many others. But in reality, such an offer might be too good to be true, especially for a stranger. Let's explore what someone in need might do with such a windfall, and what ordinary Americans think they would do.
Immediate Needs vs. Long-Term Goals
I wouldn’t believe you. No one just gives a complete stranger a million dollars without a catch, right? While a million dollars would indeed be a dream for many, even a smaller sum like $1000 could provide substantial relief. I am currently in dire need of $60 to avoid having my trash pick-up cut off, a refrigerator, groceries, home repairs, new glasses, and dentures. I need to take my cat to the vet, and the list of necessities goes on. A million dollars would be a dream come true, but even a thousand dollars would be incredibly beneficial.
A Letter to a Potential Loyalist
If someone were to offer me a million dollars, I would be skeptical and cautious. I would accept it graciously, with a polite and appreciative response. I might quip, "Put your money where your mouth is," and request an assessment of the actual amount being offered. If they do not genuinely have that much money, I would decline the offer and disregard any further offers. If they confirm their capability, I would discuss what I am willing to provide in return, such as work, services, or contributions to a cause I believe in.
Putting the Money to Good Use
Assuming I were to accept the generous offer, I would spend the money strategically. I would buy tax-foreclosed residential properties and transfer them to homeless children with their parents as contracted custodians. Additionally, I would save a portion of the money to feed squirrels, a personal passion of mine. This approach ensures that the money is used to help others while also supporting my personal interests.
What Do People Think They Would Do?
According to a survey by Schwab titled the 2019 Modern Wealth Survey, when asked what they would do with one million dollars, the following responses were given:
Save
About one-fifth of respondents said they would save the money. Saving is a responsible decision, especially if you don't already have an emergency fund. It's important to have enough cash to cover three to six months of living expenses in case of job losses, medical emergencies, or unexpected repairs. While you don't necessarily need to save the entire million, investing a significant portion of it in retirement accounts can be a smart move.
Invest
Another quarter of respondents said they would invest the money, which is a crucial step towards growing your wealth. The more money you have, the more potential it has to grow. Here is an example of what you might accumulate over time by saving substantial sums every year:
Sample Investment Table
For illustrative purposes, let's consider a scenario where you save $100,000 a year for 10 years, with an average annual return rate of 7%:
Year Initial Investment Accumulated Value 1 $100,000 $107,000 2 $214,000 $234,058 3 $321,000 $356,156 4 $428,000 $478,551 5 $535,000 $599,971 6 $642,000 $712,978 7 $749,000 $811,199 8 $856,000 $901,221 9 $963,000 $980,486 10 $1,070,000 $1,110,126As you can see, the compounding effect of saving and reinvesting can significantly increase your wealth over time. This strategy not only helps you save for the future but also allows you to grow your assets.
Conclusion
Receiving a million dollars is a rare opportunity, and how you choose to use it can have a significant impact on your financial and social well-being. Whether you choose to save, invest, or put it to other uses, make sure to think carefully about your goals and values. A responsible use of such a windfall can bring about meaningful change and contribute to a better future for you and those around you.