Welcome Guest
Log In | Register )
You last visited December 3, 2016, 12:35 pm
All times shown are
Eastern Time (GMT-5:00)

Kansas Powerball lottery winner claims jackpot anonymously

Topic closed. 32 replies. Last post 10 years ago by guesser.

Page 3 of 3
PrintE-mailLink
Avatar
NY
United States
Member #23835
October 16, 2005
3474 Posts
Offline
Posted: October 8, 2006, 1:49 pm - IP Logged

Just hardly half-kididng about being tough to live on 1 million a year for 29 years.  Most people quickly get used to their income.  Having $1 million a year is great for the year or three, but then you start noticing that the docking fees on your yacht keep going up.  The cost of a new Rolls-Royce has continued to rise.  Your service staff keeps wanting raises.  Those monthly trips to Europe keep rising with higher first class costs and luxury suite costs.  Without an inflationary increase in your income, your "true" income - your lifestyle begins to decline.  If you do a little math, you will find that a $1 million needs to be $1.4 million in 10 years; $1.8 million in 15 years; and goes over $2 million in 20 years - just to stay the same.  Any investment advisor setting up an annuity stream for someone will certainly set up a graduated stream.  To do otherwise would be irresponsible.


Living on a fixed income for a long time obviously has its down-side, but what you're describing is stupidity. Being stupid is a much bigger problem than an income that doesn't go up. I could spend the 600 grand a year I'd net after earning a million bucks a year, and I could probably do it pretty easily, but  only by being stupid or reckless. 600 grand a year is enough to live extremely nicely and still make an annual investment that's considerably more than the average household income.

Of course I do see some posts here that indicate that a fair number of people might follow the wrong path. When people talk about how they'd spend a windfall of a couple of hundred grand to a million bucks there's a lot of talk about vacations, new cars, new houses, etc, but few posts about saving most of it for retirement. How many people with a typical household income are already putting away the 10 or 20 grand a year for their retirement that they could by investing the majority of a windfall?

One of the problems with annuities is that a lot of peole will start living within their means, but just barely within their means. For those people, even a 10% annual increase will probably just result in a 10% increase in spending.There's no question that a lot of people would be better off choosing the annuity, but I think the people who would benefit the most are among the least likely to do so.

    Avatar
    Urbandale, IA
    United States
    Member #8624
    November 11, 2004
    115 Posts
    Offline
    Posted: October 8, 2006, 2:05 pm - IP Logged


    Living on a fixed income for a long time obviously has its down-side, but what you're describing is stupidity. Being stupid is a much bigger problem than an income that doesn't go up. I could spend the 600 grand a year I'd net after earning a million bucks a year, and I could probably do it pretty easily, but  only by being stupid or reckless. 600 grand a year is enough to live extremely nicely and still make an annual investment that's considerably more than the average household income.

    Of course I do see some posts here that indicate that a fair number of people might follow the wrong path. When people talk about how they'd spend a windfall of a couple of hundred grand to a million bucks there's a lot of talk about vacations, new cars, new houses, etc, but few posts about saving most of it for retirement. How many people with a typical household income are already putting away the 10 or 20 grand a year for their retirement that they could by investing the majority of a windfall?

    One of the problems with annuities is that a lot of peole will start living within their means, but just barely within their means. For those people, even a 10% annual increase will probably just result in a 10% increase in spending.There's no question that a lot of people would be better off choosing the annuity, but I think the people who would benefit the most are among the least likely to do so.

    I can only agree with you, but then I'm one of those people who seem to always need to spend it all.  I have a CPA friend who manages to spend less than 100% of their income and I imagine that about 5% of the population can do that.  I could really be socking it away if only I stayed living on $12,000 a year.  My only excuse is that you do have to live a little for today - you never know when it will all end.  I do know that when I'm stuck in that cheap retirement home while my buddy is getting luxurous bed baths and the tastiest of pureed foods, I'll probably be jeolous (well, maybe not).  I've heard wealthy folks say - "It all goes to the same thing, no matter how much you make, your house ($10 million instead of $150,000), your cars, and your recreation.  Of course, those things all mean different things to different folks.

      guesser's avatar - Lottery-017.jpg

      United States
      Member #41383
      June 16, 2006
      1969 Posts
      Offline
      Posted: October 8, 2006, 9:15 pm - IP Logged

      I can handle money very well because we never had it when I was growing up, it was just me and mom.

      She worked minimum wage jobs, I worked in Jr. High, High School and College.

      Momma preached to me from day one 'stay out of debt', and except for student loans, I have.  I live every day as if I was

      making $18,000 a year, and I made about 3x-4x that amount, but I still lived as cheap as I could, no telling when your job might disappear.  I parlayed $60,000 in the stock market to almost a million, gave back 10%, then got out of the market.  It's all in an IRA I can't have anyway, until I retire. 

      My job HAS disappeared - twice in four years, thank god we have no debt at all except for our mortgage, and I have saved enough that I don't need to worry for quite a long time, hopefully I will land another job soon, and get my wife off my back (she works). 

      It all comes back to priorities, how you were raised, what life has taught you.

      I could very easily spend a few hundred dollars on lottery tickets every drawing, I limit myself to 10.  I'm not so tight that I squeek, but I do have the philosophy that 'you can't take it with you', so I do indulge once in awhile.