I have been contemplating what I’d do if I was to suddenly come into possession of $1 million. I’ve thought about that also, you might say. But have you really? Sure we often daydream of what we’d do if we won a large sum of money, but those are usually musings of buying X or Y expensive toy. There is no shortage of stories of people who come into that kind of money either from sports or who actually win the lottery and come out worse for the wear.
Here is my list of a few ways I could spend $1million (after taxes).
For my first attempt at being rich: first I’d buy a house probably in a nice warm state, lets say Georgia, since if you’ve read any of my articles yet you should understand my aversion to winter. Lets say that house cost me $350K. Then I’d buy a Lamborghini Aventador which would cost me another $450K. Now that I’ve only got $200K to spend on taxes for my house, electricity, insurance (for the car) etc, lets just say that I’ve already spend that last $200K. Well that was a fast way to spend that money. Not difficult to see why it’s easy to spend all that money really fast!
Lets try a little more “practical” way. Keep the house, in Georgia so still $350K. Of course it has a great garage for what comes next. A new Corvette is $60K so I’ll buy one of those. Of course I’d need at least one vintage muscle car. Why not a Dodge Charger, 1969 of course, we’ll just say $40K. With this I could do the Hot Rod Power Tour for about $3K, which I’d recommend anyone who can do the Tour at least once do! Probably buy a new Harley and do Sturgis ($19K (2012 Street Bob (candy red, pipes, seat, handlebars)+$2K (trip)) = $21K.
So far I’m up to $434K which is not to bad considering all the toys I’ve bought thus far. $434K. Feels good being so responsible. New Lamborghini’s are sure expensive (as evidenced by way’s to spend money $1). On that note, used Gallardos aren’t to expensive! So ad one of those to my list, $115K. At this point I need to start thinking of more exotic ways to spend money. Perhaps attend DirtFish racing school for a week to learn to drive rally cars. A 3 day class is only $3600. Cheap for what it is. I think the next thing I’d apply for is the Gumball 3000. If you’ve not heard of that no worries. It’s basically a Hot Rod Power Tour but for rich guys. At least they are trying to do something to give back these days.The cost of the Gumball 3000 for 2014? $64K for 2 people! After that big party finished maybe I’d try my new racing skills on the One Lap of America which would cost a cheap $3K! (Why haven’t I done this yet?) What is the One Lap? Basically one of the most extreme performance tests of a street car! It’s one week where you have to race at many different tracks, from full road courses to drag strips. Here’s their description
“The event, as it always has been, is foremost one of endurance and vehicle preparation. No support crews are allowed. The tires that are used on the street are the same ones that are raced on (one set per team). Although scoring is based on performance at the race tracks, the vehicles and their drivers must survive over 5000 miles of driving interspersed with the finest meals available at gas station convenience stores.” I’m honestly having a hard time coming up with more ways to spend this million as I sit here writing!
I’m up to $619,600. So lets just call that good!
Arguably this 2nd way would probably be quite a bit more fun than having 1 very very expensive Lamborghini and a nice house. But it’s still very me focused. I’m buying this car, I’m driving this race. I’m spending $64K on a 1 week party. (I think the One Lap of America looks like a better deal than the Gumball 3000, just to note).
What I wanted to propose was a few different ways to make a bigger difference in the world than to spend all that money on yourself though. Start by watching this TED talk on Effective Altruism. What is that you ask?
“Effective altruism is a philosophy and social movement which applies evidence and reason to working out the most effective ways to improve the world. Effective altruists consider all causes and actions, and then act in the way that brings about the greatest positive impact.” – Straight from Googling Effective Altruism
So to the numbers, because numbers never lie, if someone honest is presenting them. Lets say anyway I spend money I’m going to spend $200K on a house, because that is just smart to have a place to live (although to my next point that might even be a bit expensive). So with $800K what could I buy?
Well if you wanted to sponsor a child in a developing country it only costs $25/month. Take that by 18 years (because that’s when most kids can’t be sponsored anymore) equals $5400, and divide $800K by $5400 and you get 148.
So in summary, you could sponsor 148 kids in developing countries for 18 years on $800K. Think about the impact that would be. Your minimal sponsorship gets these kids access to schools (they have to stay in school to get the money). More consistant food, better living conditions, access to health care etc. While these may not be up to your standards it’d sure be a step forward for these kids.
If you wanted to make a larger impact, in terms of numbers, you could donate to End7. What is End7? It is a site who’s goal is to vaccinate children to give them immunity to NTD’s. What are NTD’s? Neglected Tropical Diseases. Why are they bad? “Neglected tropical diseases kill an estimated 534,000 people worldwide every year” – CDC
“Neglected Tropical Diseases (NTDs) are the most common diseases of the world’s poor.Most people have never have heard of diseases like elephantiasis, river blindness, snail fever, trachoma, roundworm,whipworm or hookworm. But nearly one in six people globally, including more than half a billion children, have these diseases. Without treatment, NTDs can lead to lifelong disabilities and suffering.Just 50¢ can treat and protect a person against all seven of the most common NTDs for up to one year.” – Straight from the End7 website.
Did you reread that number? $0.50. Whats that? Lless than you might leave sitting on the ground if you walked by it. To the numbers, $800K/ $0.50/year x 18 years = 7407 kids you could save for 18 years from awful diseases that you’ve never been exposed to.
Now it might seem easy to say, but Axel, you’re just sensationalizing these things. I don’t think so. Think about why you were never exposed to these diseases or poverty. Likely because you were lucky to be born into a family/country where basic health care was to be expected. Going to the dentist, getting your shots, having food on the table. Maybe someone of you were less well off than others, but probably not many have had to sleep on a dirt floor and have it a common occurrence for family to die from a disease for which there is a cheap available cure somewhere else in the world.
You might also object, saying “If those people can’t pay for their own kids they don’t deserve my money.” Think of it this way, there is a correlation between increased education and reduced child birth rates. (I’ll not get into if I think that’s a good or bad thing.) But if we spend time saving these peoples lives they’ll likely have less kids than their parents, and if they are more educated they’ll be able to spend the $0.50 a year to save the kids they do have.
This might seem like I’m getting on quite the high horse and saying material thing are bad, and that’s just not the case. I freely admit that I have a lot of toys myself, motorcycles, cars, etc. But to be the change you want to see in the world, you have to start with yourself. That’s why I’m starting to inventory process. Reflecting on what I have, what I make, and what I can afford to share. I will not give my exact numbers for charitable donations at this time (I might go over that in a future post), but suffice to say it’s not insignificant, and it makes me feel good. A lot of people are struggling in this world, just read about The Restless Project. Why? A lot of it seems to be due to materialism. But what really makes us happy? Check out this psychology. Giving and helping others (with time also), makes us happy! Think about it.
So next time you are thinking about how you’d spend a million dollars, stop and think, “Do I really need a million dollars, or have I already won some lottery compared to a large percentage of people in the world?” And if you find yourself saying yes to that, consider how you can give back. It will make you happy and the world a better place.
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