What Would You Do With 1 Million Euros?
Money.
They say we don’t need money to be happy, and it’s true, at least in part.
We don’t need money, we need the things that money can give us: a better home, an increase in comfort, the freedom to do what we want in life.
However, most of us are not used to a lot of money, and if we suddenly found ourselves with it I don’t think we would know what to do with it.
Lately I’ve been reading articles about financial literacy, about people who have suddenly earned large amounts of money.
Naturally, if we earned 100,000 euros we would quickly know what to do with it, because it’s an amount we can relate to, we would use it to solve our urgent problems. We’d probably get a house, a car, go on a few holidays, help our family and that’s it, the money’s gone. And after that?
When you’re talking about €1 million things change.
That amount is not huge, those who started from scratch and became millionaires would know what to do with it precisely because they got used to managing money, but the rest of us, the ordinary people, who make short-term plans, what would we do?
It’s still a substantial amount of money that could not only change our lives, but could change the lives of our family, including future generations, if used wisely.
If I won or had €1 million I would do the following:
-I would make sure that no one knows that I have earned this money, except for family and very close friends, because money attracts the envy of those around you, and when you suddenly earn it you can find your friends becoming your enemies and people suddenly changing their attitude towards you.
-I wouldn’t change my lifestyle suddenly, so as not to attract the attention/envy of others.
- In time I’d buy/build a normal house with land in a quiet area, I’d probably change my car for a slightly better one, but I wouldn’t throw money around, I wouldn’t spend it on crap just because I have it.
-Let’s say I’d allocate 10% of it to lifestyle improvements.
-10% of it I would use to help my family, without expecting anything back.
50% of it I would invest for the long term in low to medium risk investments (shares in safe companies, bonds, treasury certificates, mutual funds), but I would not invest it on my own, but with the help of a financial advisor.
-Sometimes we have to recognise our limitations, leave money management and investment recommendations to those who already manage considerable amounts of money.
-20% I would invest in real estate, probably 2–3 apartments.
-It’s not an income generating investment, but the market is pretty stable right now, plus I’d rather put the money into apartments to rent than keep it in the bank.
-The remaining 10%, so €100,000, I would use to start or finance businesses with long-term earning potential, both offline and online.
I’d probably go into percentages, 1 million euros can be spent in a few years easily if we don’t have financial education and if we don’t know how to manage it, I say.
I’ve seen enough cases where people who earned millions of euros spent them on luxury houses and cars, exotic holidays, designer clothes etc, without thinking about investing for the future, without trying to turn the money earned into a long term income generator.
