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Ask HN: What would you do with $1,000,000?

11 points by mybbor ↗ HN
Hello HN. I was sipping on my morning coffee and I had the idea to ask HN, "What would you do if you received $1,000,000 today?" How much would you spend, how much would you invest, where and how would you invest it? Would you continue to look for funding for your projects? Or, would you self-fund with your newly acquired nest-egg?

25 comments

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S_A_P
resisting the urge to quote the movie office space here...

I would pay off debt, save a portion, and invest the rest. in my case it would work out to be just about equal parts. That solved, I would probably spend a few months recharging and starting a business of some sort- most likely some sort of software plugin creative tool for musicians.

petervandijck
You have 300,000$ in debts? I feel for you.
jackowayed
Depends on what kind of debt. Having a $300k mortgage would not be a big deal.
S_A_P
Mortgage plus car note. personal/CC debt is pretty much nil.
noodle
a million bucks isn't enough to retire on in perpetuity, but it is enough to set yourself up in such a way that you can, professionally, do almost anything you want with your life as long as you have some sort of working income stream.

i'd probably work on my current bootstrapped startup full-time for a while, see how it goes, and then travel the world while doing freelance work a few hours a day.

edit: oh, and pay down all of my debts, of course.

byoung2
a million bucks isn't enough to retire on in perpetuity

It is if you don't live in the US. You could invest that money in the US where you can get decent returns and live somewhere like the Philippines where less than $1000/month affords you a comfortable lifestyle (see http://trifter.com/asia-pacific/philippines/true-cost-of-liv... for a middle class married couple who do it for under $500). Living in the Philippines will also give you a more relaxed lifestyle (maids, drivers, live-in cooks, etc) so you could even work on a startup if you wanted since you can't say you're too busy working or doing chores.

noodle
> It is if you don't live in the US.

i disagree. even if you adjust for inflation, consider taxes and such, you can live a very comfortable middle class lifestyle on $1m in the USA. going elsewhere, of course, makes it easier.

but its not about "just living". retiring in perpetuity it about having enough money socked away that, for example, a major, expensive medical problem won't ruin it for you, or that you can put your kids through college. its the big non-regular life expenses that get in the way.

byoung2
I completely agree that you can do it in the US, I just meant that you can get more bang for your buck in a place like the Philippines. $1,000,000 invested in the US, even if you could get a 10% guaranteed return (that's a stretch in this economy), you'd earn $100,000 per year. Inflation is going to eat 3-5% of that $1,000,000 each year, so you can only take out $50-70,000 if you want the nest egg to stay intact. Give 1/3 of that to Uncle Sam for taxes, and you have $30-50,000 to live on, which won't go far, even in Arizona. Hopefully you have the restraint to live a lower-middle class lifestyle knowing you have $1,000,000 in the bank. In the Philippines that same middle class lifestyle can be had for $6,000/year, or if you want to live an upper-middle class lifestyle, $12,000/year.
anamax
You're assuming that you're only taxed on what you "take out" and that's wrong. You're taxed on taxable income, whether or not you "take it".

Yes, income inside tax deferred accounts is not considered income until distributed, but other accounts don't work that way. If there are sales, dividends, or interest, you've got taxable events even if you leave the money in the account.

Let's look at that $100k in earnings. $10-20k goes to taxes. (The marginal rate for $100k is higher, but you don't pay it on the whole amount.) $30-50k goes to inflation, leaving you $30-70k to "safely" take out.

However, it's hard to get 10% these days - even 5% may be too high. Fortunately inflation is currently low too, but $5k for taxes and $20k for inflation leaves you with just $25k to safely take out.

user24
save half, invest a quarter in long term things (property, bonds, etc), distribute an eighth to friends and family, improve my own immediate quality of life with 1/16th. Invest the final 16th in shorter term projects, eg putting together a startup etc.
petervandijck
No party?
user24
"improve my own immediate quality of life"=="vodka, hookers and weed" ;)

edit: and a top hat and monocle. I mean, I am loaded after all...

_b8r0
I'd pay off the mortgage, take a short holiday somewhere nice then consult a wealth advisor to help with creating a more diverse investment portfolio.
charlesdm
I'd buy a nice place, and use the rest of it to live while I build something else.
Tycho
I'd spend it on hackers, designers, marketing and hosting to aggressively launch my 'big idea' with a head start on anyone who tries to copy it. (It's an idea for a website with low costs but universal appeal and clear money-making potential... but if I just built it now there'd be nothing to stop a bunch of richer more competent people making clones. So I'm sitting on it till I figure out what to do about that. Which is a pity cause I think the world could really use it)

Ok, I probably wouldn't blow it all on that.

kreedskulls
I would start a Y-Combinator Branch in Atlanta!
jshen
buy a nice house in a nice city
raquo
I would probably set up a software / gamedev company in US (and get a green card).
n2dasun
Pay off all my debts, then my parents and in-laws, set up college funds for my children and nieces/nephews/godchildren, give something to my siblings and my wife's, invest half of what's left, and donate the rest.