Say you just won $100 million....

[thefed]

Would you give some $$ to your family? All of them, or some ? None of em? One lump sum? Or would you buy them something... a house, a car, etc?


I always wonder about this. I think I'd just determine a fair amunt for all 'secondary' family (aunts, uncles, cousins, etc) and give it to them, whether or not im closer to this one or that.

Then I'd be a little more generous with my parents, brother, grandparents, child, wife etc. I think I'd actually buy my friends something that could help them...like a business, or real estate, or something like that.



Anyways, I'm sure you've done the " If I win the lottery" scenario before.... what did you do?

 

[MasterBlaster]

The $100M Question

[-]
I am not going to win $100M, so I don't think about it much. Instead I save and invest so that I'll be better off in the years ahead.

Evidently this (wishing for a windfall) is the retirement strategy of many. If you google on "what would you do with a million dollars" you'll get 25,400,000 links.

People have it all figured out what they would do with it. Oh, they narrate on and on about how wisely they could use it.

They just can't seem to get around to doing anything to get there.

- Good luck with that, cause that's what you will need.
[/-]


I edited my post after thinking about it. Perhaps It was a bit too mean spirited. To the OP, you enjoy your little pipe dream. Life wouldn't be too much fun if we couldn't dream.

 

[W2R]

Anyways, I'm sure you've done the " If I win the lottery" scenario before.... what did you do?

I really don't know what I would do. Money has a way of creating chasms between people, disintegrating friendships, and distancing family. I could keep it secret from everyone, but then I couldn't give them money or I'd give myself away.

On the other hand, I'd hate to think of them all slaving away their whole lives if I could help them. Besides, they'd figure out SOMETHING happened if I quit work and started living the good life in an expensive location.

In a way, winning the lottery sounds like a lot of work.

 

[packrat44]

My DW and I would would retire immediately. No, wait, we can't do that. We have already been FIREd.

 

[packrat44]

Someone told me in order the win the lottery you have to buy a ticket or two. Well so much for the idea of winning the lottery.

 

[Ed_The_Gypsy]

Probably drink myself to death. In Majorca.

 

[Khan]

Pay medical and educational expenses for relatives if they promise to never contact me except by email.

 

[dgalbraith100]

I use to think I would just give all of it away to charity, but now I think that would just create an instant divide from my friends and family. Why didn't I give X to them... and I'm not sure it matters how "fairly" you divide it up, somebody will be unhappy.

If at all possible, I would take it anonymously, keep enough to put assets at 5M (more than I will ever need) and then give the rest to the Bill and Melinda Gates Foundation.

If I couldn't take it anonymously, I'd be really tempted to not take it at all... Money that wasn't earned has a very high potential of destorying friends and family. Earned money has a much smaller potential of causing the same problem, and money saved over years is "invisible". My friends and family know I have money, but not really how much, just that I am a saver not a spender

just my random thoughts.

Laters,
-d.

 

[Caroline]

I haven't won the lottery, but the small amount I've earned and saved through hard work and frugality has caused trouble enough in my family.

What dgalbraithe100 said.

 

[Peaceful_Warrior]

I would set aside a large chunk into a trust for charitable organizations, then I would set aside a large chunk for myself so I'd never have to work again, then I'd set aside large chunks for my immediate family members and nephew and neice. Lastly I'd share some wealth among my friends.

If I felt that the people in my life wouldn't be grateful for whatever I give them in any amount, then I would not give them any and I wouldn't worry about the "guilt" or whether or not they feel it was "fair" because they obviously didn't feel I meant more to them than the money.

 

[Texas Proud]

Boy... some of you I wonder about... you would not accept $100 million... or you would want to keep it quiet from your relatives Gee, glad I am not in your family....

We are not talking about $1 mill or $5 mill, but $100 mill...

Most of my family would be very happy for ME... and all would get 'something'... and they would be happy... believe it or not, our family is not some money hungry family... some have money, some do not have any... no problems from the ones without money.. they come to the family gatherings and have a great time... I am one with money and I help out my nephews and nieces with their education expenses... but that is it... and nobody has ever asked for anything...

In addition, if I did get the big one... I have a few friends who would get their current salary as a gift per year.... and I would adjust for inflation... if they wanted to continue to work, that is their choice... I mean, I would have at least $4 mill a year to play with.

 

[haha]

What I wonder is why African-American athletes seem able to share their huge earnings generously with their families, without anybody appearing to get bent about it?

Is it just that they have a more group oriented culture?

Ha

 

[Gekko]

What I wonder is why African-American athletes seem able to share their huge earnings generously with their families, without anybody appearing to get bent about it?

Is it just that they have a more group oriented culture?

Ha

That seems like a massive generalization. From what info are you drawing - keeping in mind that what you see in the media, for better or worse, is hardly much of an indication of anything.

To humor your point, if it were true, I'd guess that many athletes in general, come from humble beginnings and are the "lucky" ones in their families. As somebody who has gone from very poor to moderately well-off in a generation, I can sympathize with the guilt and baggage that comes along with success in the face of very long odds.

If I got a $100mm windfall, I would set aside about $10mm for myself, spread some around to family, set up a foundation for the arts with a good chunk, and start an investment fund with the balance, with a portion of the funds geared towards investing projects which in some way help develop underserved communities.

But, I don't play lotteries, so it'll have to come from some other method.

 

[JohnDoe]

Boy... some of you I wonder about... you would not accept $100 million... or you would want to keep it quiet from your relatives Gee, glad I am not in your family....

That's because if you actually did win a $100 million lottery, you'd have more than your family knocking at your door. You'd have phone calls, emails, letters, knocks on the door, at about 100 per day asking for money - so I've heard.

 

[gettingthere]

I have daydreamed about this, as probably everyone has. I would keep enough to give myself a comfortable cushion (maybe $1 - 2 Million), and the same for my immediate family. I would set aside a large amount for charity, give some to my small town to pay off debt (recently built new school) and reduce the tax burden on the town, and then divide the rest among friends and more distant family members. I think 100 million won’t do everything I’d want. – I’d need one of those larger $300 million jackpots….

I know the chances of winning are miniscule, but I look at the dollar spent as cheap entertainment for a while – and, hey, you never know. Someone’s got to win – why not me? I usually only purchase a ticket for the larger jackpots.

 

[citrine]

I only play the larger jackpots as well....if I won a 100 million.....I would give 10M each to my Mom, Dad, and Brother.
I would keep 10M for myself....the rest of the 60M....I would give to charity, anonymous gifts to up and coming artists and galleries....and to the various animal shelters in the area. I would also open up a free art studio for kids to create whatever their hearts desired.

 

[HFWR]

Start a scholarship fund for some [-]topless dancers[/-] young ladies struggling to pay their way through college...

As someone mentioned, not buying lotto tickets guarantees you'll never win. However, buying lotto tickets doesn't improve the odds much...

 

[kaudrey]

I would probably keep $10M for myself so I could retire and travel the world. Then I'd take another $10M and give it to family. I'd set up a charitable trust with the rest.

With my $10M, I'd take my friends/family with me on trips, help fund college for some friends' kids, fund some events that I now have to go out and raise money for, etc. My close friends definitely would benefit. Why not? It is not in my nature to be able to spend $400K a year, even touring the world. So I might as well spend it on people who are important to me!

 

[justin]

Knowing my family, I'd give annual payments to my immediate in-laws (something significant, but less than what their typical annual salary might be), and probably a lump sum amount to most of my side (enough for my parents to retire, for example).

It would be hard to determine where to draw the line (ie - immediate family only, also 1st cousins, aunts, uncles, etc. friends?)

I'm assuming the 100 million is after taxes and in the lump sum. If I won a $100 million jackpot, then I'd expect to get closer to $30 million take home money after taxes and present value. And let's just say $30 million just ain't what it used to be! After all, that is only $1.2 million at a 4% SWR, and taxes on that kind of income wouldn't be insubstantial. But that is magnitudes greater than my current spending, so I could definitely loosen the purse strings a bit.

My focus would be on enhancing the quality of life for myself and those close to me. I'm thinking college expenses for kids, nieces, nephews, etc. Seed money for realistic businesses, family vacations (the whole extended family). Selective spending on other things as I see fit. Probably spend a lot more on selective charities (college endowments, library, 3rd world education/poverty, etc).

 

[dex]

I'm too lazy to do this but here is an idea. Make up a story that the IRS is going to put you in jail if you don't come up with $X; they took all your liquid assets so far. Send out a letter to all your relatives asking for whatever they can give by Y date in a check made out to the US Treasury Dept. Let them know you might need a place to stay for awhile after you sell your house.

See who gives you what. Then think about telling everyone that you won the lottery and be generous with those who gave you something and/or offered you a place to stay.

 

[dex]

PS - I think someone said that lotteries are a form of a stupid tax - the dumber you are the more you are taxed.

Having said that - I do by one about once a month or less - I like to dream.

 

[RunningBum]

If I won a $100 million jackpot, then I'd expect to get closer to $30 million take home money after taxes and present value. And let's just say $30 million just ain't what it used to be! After all, that is only $1.2 million at a 4% SWR, and taxes on that kind of income wouldn't be insubstantial.

You wouldn't get taxed twice on that money. The $30M has already been taxed, so the 4% each year is just your own allocation of funds, not taxable income. Of course you'd be investing that $30M and anything you make on it is taxed, but that means the $30M base is growing too.

Don't gifts over 10K count against your estate taxes? I suppose there's ways of creating family trusts to give them houses, cars, etc, or putting those things in your name, is that how people do it?

Mostly it seems like a headache because as I understand it, it's tough to stay anonymous so you'll have every quasi charity, uncle's friend, friend's uncle, and just about everyone else with their hand out. I'd certainly do something for my family, especially education and health expenses, help with debts, etc. But I'd worry about whether any of them would go crazy with the money and whether I'd have to put strings on it, which wouldn't be fun for anyone. And if you won too much, you'd probably start having to worry about personal security.

And that's why I've never bought a lottery ticket. The odds are poor, and I really don't want a mega prize.

I suppose I wouldn't mind clearing about $10M, that seems like a good amount to live very comfortably, pass out annual $10K checks to family, but not so much to draw constant attention like that guy in WV.

 

[justin]

You wouldn't get taxed twice on that money. The $30M has already been taxed, so the 4% each year is just your own allocation of funds, not taxable income. Of course you'd be investing that $30M and anything you make on it is taxed, but that means the $30M base is growing too.

Don't gifts over 10K count against your estate taxes? I suppose there's ways of creating family trusts to give them houses, cars, etc, or putting those things in your name, is that how people do it?

I understand the double taxation issue. However, the $30 million invested might generate half a million or a million in taxable income (depending on choice of investments, of course). Even if I'm selling investments where Capital gains = zero (ie - sale price = cost basis), I'm still on the hook for taxes on the income generated by the portfolio.

In practice, two people (either married or unmarried) can give $12000 each to any number of recipients per year. In other words, me and DW can give $24000 to any number of individuals tax free. Then there's another $2000000 in gift tax exclusion for a married couple to use up during life or upon transfer at death. The $24000 limit per recipient means a married couple can receive $48,000 per year from us. A family of 4 can receive $96,000 from us. Not limitless, but a pretty lax "limit". You'd certainly have to structure gifts appropriately so as to limit tax liability.

There is also a work around that I think is acceptable in practice (maybe not technically "legal" ), where you allow those to whom you want to gift significant amounts to claim a fractional interest in the lottery ticket claim. In other words, if you won $100 million, and you wanted to give mom n pop $1000000, you would allow them to claim a 1% interest in the winning ticket. I suppose a prosecuting attorney would claim the transfer of a 1% interest in the winning ticket to be a gift worth $1000000.

Of course you'd want to hire a tax attorney, estate planning attorney, and/or tax accountant/CPA at a minimum to figure out the appropriate strategy for claiming the ticket and structuring your affairs.

 

[RunningBum]

OK, that makes sense, when people do lottery pools they split winnings. I remember seeing the whole group from the Nebraska meatpacking plan collecting the prize a couple years ago. So it's seems likely you could do this with family without much of a problem. It just means you probably need to figure it out before collecting.

I forgot that the 10K limit was raised to 12K.

 

[peggy]

DH and I have no kids, so it's all extended family on his side. I'm an only child and not generally close to most of my extended family. So while we may seem a bit "stingy", it's just a reflection of the facts.

The very first thing I'd do (after setting aside 33% for taxes) is arrange for our friend P to have surgery to get his back corrected.

Then we'd set aside money for college funds for the nieces and nephews (thirteen of them, all told). We'd help anyone out with a financial emergency, of course, but I'm not sure we'd give significant cash gifts to anyone otherwise.

Although we would consider buying all the "close" family a vacation somewhere nice -- maybe all of us going on a round-the-world cruise?

That's the short-term plans, anyway. Long-term, we'd set something up for any family members who needed long-term care due to disability, and then probably leave the rest to charity.

Nothing too grand, in other words.