What I Will Do With My $586 Million

The MegaMillions lottery jackpot is $586 million. That’s, um, a lot of money, even after I go through the mental process, like a good conservative, of calculating what the all-cash payout might be (roughly $250-$300 million) and the cap gains taxes (let’s say 30%?) netting me (back of the envelope) $200ish million.

So, really, the only question is this: what should I spend my $200 million on?

Candy, probably.

I don’t mean actual candy, I mean metaphorical candy. Grown-up candy: things like Paris apartments in the 7th arrondissment, a place on Hobe Sound, stuff like that.  Maybe I’ll invest in a center-right web-based conversation site and…..

Oh, wait.

Look, I know the odds of winning this thing aren’t great. (I also know that I am going to win it.)  But it’s fun, in a limited and highly-curtailed way, to daydream a bit, even though we’re all smart here at Ricochet and we all know that these lottery things are, basically, scams. “Idiot taxes,” a friend of mine calls them. But if you don’t have $200 million and there’s a way — even a statistically impossible way — to get $200 million, it’s only natural to spend a few moments deciding between the rue de Varenne and the rue du Bac.

Here’s what I’d like to know, though: if you do have $200 million, do you still daydream about getting another $200 million? According to Tom Corely, the author of Rich Habits: The Daily Success Habits of Rich Individuals, you do not.  

What do rich people do? They get up early, they eat right, they make to-do lists, and they set long-term goals. From Yahoo Finance:

Early RisersCorley found that rich folks often take advantage of those wee morning hours. Specifically, 44% wake up three hours before their 9-to-5 job. In those hours they focus on self improvement, reading educational material, like trade journals or industry blogs. They’ll squeeze in a workout, too, which Corley says leads to a more productive day at work.

Keep a Running List of TasksOnce they reach their offices, the wealthy don’t waste time. Most maintain a daily to-do list and check off 70% of their tasks each day. And they’re not just obsessed with short-term plans. Seventy percent of the wealthy surveyed set long-term goals, as well.

No Long LunchesTaking a long, leisurely lunch isn’t a wealthy habit, either. Instead, 55% network, wheel and deal between bites.

Calorie CountingSpeaking of eating, rich folks are big calorie counters. Corley found most wealthy people limit alcoholic consumption and keep junk food snacks to just 300 calories per day, not just so that they can fit into their skinny jeans. “Wealthy people are healthy people. To wealthy people being healthy is about making more money,” says Corley.  

No GossipingConsider this before spreading the latest workplace rumors: 79% of low-income people admit to gossiping, compared with just 6% of wealthy individuals.

In other words, they focus on the life they’re living, not the life they’ll have if they win MegaMillions, which they know isn’t going to happen. Is there a conservative message in this? We already know that to keep out of poverty, you really only have to do three things: finish high school, have children in wedlock, and get (and stay) married. If you do all of those things in addition to the items above, maybe you won’t need to win the lottery.

I’m buying a ticket anyway.

Also, Corley adds one more thing to his list:

Limited InternetFinally, when it’s time to punch out at the end of the day, how do you unwind? Head to the bar? Veg out in front of the TV? While most wealthy folks reported activities such as networking, volunteering and socializing, Corley found a majority of those struggling with their finances spent more than an hour on recreational Internet use, and were twice as likely to hop on Facebook every day.

Ahem. Is this a good time to remind you to join Ricochet?

  1. EJHill

    Because if, ahem, WHEN Rob wins, he will pay us for our witty contributions on Ricochet.

  2. Frank Soto

    We are too hard on the lottery.  It’s a 5 minute vacation after you buy a ticket.  One needs an occasional diversion.

  3. Schrodinger

    I think you underestimate the taxes. Lottery winnings are ordinary income – tax rate 45-50% depending on your state income tax.

    Better plan on only $175 million to spend.

  4. Frank Soto
    Schrodinger’s Cat: I think you underestimate the taxes. Lottery winnings are ordinary income – tax rate 45-50% depending on your state income tax.

    Better plan on only $175 million to spend. 

    How will he even pay the bills?

  5. Rob Long
    C
    Schrodinger’s Cat: I think you underestimate the taxes. Lottery winnings are ordinary income – tax rate 45-50% depending on your state income tax.

    Better plan on only $175 million to spend. · 0 minutes ago

    Damn.  Really?  That’s depressing.  For only $175 million, it’s hardly worth it.

    See?  Taxes really do curb productivity!

  6. ctlaw
    Schrodinger’s Cat: I think you underestimate the taxes. Lottery winnings are ordinary income – tax rate 45-50% depending on your state income tax.

    Better plan on only $175 million to spend. · 10 minutes ago

    There’s a special law applicable to Hollywood types and members of the Kennedy family that says all their income gets taxed at the lower long term capital gains rate rather than as ordinary income.

  7. Boymoose
    Rob Long

    Schrodinger’s Cat: I think you underestimate the taxes. Lottery winnings are ordinary income – tax rate 45-50% depending on your state income tax.

    Better plan on only $175 million to spend. · 0 minutes ago

    Damn.  Really?  That’s depressing.  For only $175 million, it’s hardly worth it.

    See?  Taxes really do curb productivity! · 4 minutes ago

    Whats state income tax?  I Love Texas ….

    When I win I will pay back Rob …..

  8. Rob Long
    C
    ctlaw

    Schrodinger’s Cat: I think you underestimate the taxes. Lottery winnings are ordinary income – tax rate 45-50% depending on your state income tax.

    Better plan on only $175 million to spend. · 10 minutes ago

    There’s a special law applicable to Hollywood types and members of the Kennedy family that says all their income gets taxed at the lower long term capital gains rate rather than as ordinary income. · 7 minutes ago

    Edited in 1 minute

    Please forward the relevant backup documentation. This interests me.

  9. Rob Long
    C
    Boymoose

    Rob Long

    Schrodinger’s Cat: I think you underestimate the taxes. Lottery winnings are ordinary income – tax rate 45-50% depending on your state income tax.

    Better plan on only $175 million to spend. · 0 minutes ago

    Damn.  Really?  That’s depressing.  For only $175 million, it’s hardly worth it.

    See?  Taxes really do curb productivity! · 4 minutes ago

    Whats state income tax?  I Love Texas ….

    When I win I will pay back Rob ….. · 7 minutes ago

    Low blow.

  10. Rob Long
    C
    Frank Soto: We are too hard on the lottery.  It’s a 5 minute vacation after you buy a ticket.  One needs an occasional diversion. · 23 minutes ago

    5 minutes?  I’ve spent the past hour pricing partial-ownership jet options.

  11. Fredösphere

    The only mega-million figure that excites me is the sum needed to fund a private space navy. And I can’t see that happening for anything less than several tens of billions of dollars.

  12. Frank Soto
    Fredösphere: The only mega-million figure that excites me is the sum needed to fund a private space navy. And I can’t see that happening for anything less than several tens of billions of dollars. 

    Might take a few wins.

  13. CuriousKevmo
    Fredösphere: The only mega-million figure that excites me is the sum needed to fund a private space navy. And I can’t see that happening for anything less than several tens of billions of dollars. · 16 minutes ago

    Well, if thinking long-term is one of the keys to becoming wealthy I’d say you are well on your way.

  14. Spin

    The lottery is a tax on the mathematically impaired. 

    Having said that, don’t forget that money you owe me, Rob.  

  15. Amy Schley

    My weekly board game group has an agreement — in the event of any of us winning the lottery, we will pay off each others’ student loans. (For those without student loans, we will finance their start-ups.)  This is likely the only way mine will get paid off.

    In looking at it, while one loses some to the time value of money, it can actually be more profitable to not take the cash payout.  And besides, at this level, it would be like cashing out a $30M lottery every year for 20 years, so it’s not like it would leave you hurting for money.

  16. Z in MT
    Spin: The lottery is a tax on the mathematically impaired. 

    Having said that, don’t forget that money you owe me, Rob.   · 6 minutes ago

    Frank Soto: We are too hard on the lottery.  It’s a 5 minute vacation after you buy a ticket.  One needs an occasional diversion. · 1 hour ago

    I agree with Frank.  The point of the lottery is not to win (while that would certainly be nice), the point of the lottery is to dream of winning. 

  17. Vance Richards

    Since it would be “winnings” rather than earnings it is easy to say “easy come, easy go,” but the idea of anyone having to pay a nine digit tax bill really disturbs me . However, if it comes to that I’ll do what I have to do.

  18. Johnny Dubya

    4th arrondissment.  A place on Lake Winnepesaukee.

    Seriously, though, I disagree that the lottery is a harmless diversion.  Outside of certain places such as Nevada and Atlantic City, gambling seems to be a business reserved for the state and for “native Americans”.  The states’ rationales for the lottery usually include an appeal that “it’s for the schools”.  Yet the schools don’t improve.  It’s a scam.  A common rationale for “Indian” casinos is that reservations are sovereign states, which is absurd, as is the claim on “native American” heritage by many of the “tribe” members.  It’s a scam.  The most egregious example is the Mashantucket Pequots and the Foxwoods Casino in Connecticut.  The Pequots ceased to exist in the 17th century.

    Now, if they got rid of income taxes and replaced them with the lottery, that’s an idea I could get behind. :-)

  19. Johnny Dubya

    I hate to be a buzzkill, but don’t many of the folks who win these huge jackpots end up regretting it?  Such sudden wealth can be hugely destructive to personal relationships and, counterintuitively, to quality of life.

    At least, that’s what I tell myself.

  20. Z in MT

    The lottery is certainly a lot less harmful than most other forms of gambling.  MT has very loose gambling laws.  Live poker has always been legal, and video poker and keno are found in many bars and even some gas stations.  There is nothing sadder than looking into the “casino” side of a gas station at 9 am and seeing 80 year old ladies punching buttons on a video poker machine.

    Johnny Dubya: 4th arrondissment.  A place on Lake Winnepesaukee.

    Seriously, though, I disagree that the lottery is a harmless diversion.  Outside of certain places such as Nevada and Atlantic City, gambling seems to be a business reserved for the state and for “native Americans”.  T

    Now, if they got rid of income taxes and replaced them with the lottery, that’s an idea I could get behind. :-) · 2 minutes ago