Forums: Discussions for entrepreneurs and small business.

I have a suspicion that the reason so many people wish they had money and don`t is because they don`t really understand large numbers. Do you?

Let`s suppose you came into twenty million dollars. It might be you played the lotto and won, someone died and you inherited it, or you found a magic lantern and a geni granted your wish. One way or another, you come down to breakfast with the fact that you now own $20-million.

Let`s further suppose that this is after-tax money. Whether you won this at a casino, it`s an estate, or you`re just an honest person and told the IRS about that geni, you`ve paid all taxes, and this $20-million is now "fee and clear" of all obligations. Right now, it`s cash sitting in a bank. It`s not in savings, it`s not an annuity, it`s a lump-sum amount.

What exactly would you do with it? I don`t mean a few things; what would you do that accounts for every last bit of it? Not down to the penny, but if you`re going to invest, how much, exactly, rounded to the nearest $1,000? If you do intend to invest it, also put down your expected rate of return.

In other words, if you say, "I`d invest $10-million, and suppose a 4% return," you`d now have an additional $400,000 per year you`d have to account for. By "account" I mean, you have to target that for further spending or investment, and list what you intend to do with the income.

List the breakdown---write it out in enough detail that anyone reading your post can use a calculator and say, "Hey...there`s $3.7-million left; what about that?"

Whatever you intend to spend, put the amount and the item---what you spend it on. So if you say a car, list the cost of that car. For example, "I`d buy a Mercedes for $80,000." "I`d buy a house for $3.5-million, in Miami."

Though intrigued I would like to know what your purpose is for posting this question.  I have read enough of your posts to know that there is probably a purpose behind the question and I would like to ask what that purpose is before deciding to post a response....

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Regards, Warren Endes Owner/Operator www.wedustuff.com wendes@wedustuff.com

Gheeesssh.... sorry but this would take forever. I`ll play along, but in the
general sense.
#1   Give 10% to God - and that`s the 10% before it became free and clear.
#2   Quit my job and pre-pay my daughters college education at Notre
Dame - purchase a small house in South Bend, Indiana for her and a
couple of her friends to live in her Sophomore year through her Senior
year of college (everybody has to experience dorm life!!?!)
#3   Let my husband put his job on hiatus for at least a year and give him
money to start his own dog aggression training business. If he likes it
then maybe leaving his job would be a permenant thing!
#4   Take my daughter out of school
#5   Hire a private, highly qualified tutor
#6    All of us would travel the word - including the tutor for at least a
year - teaching our daughter amazing things - along with us learning
things.
#7   There`s a homeless man out here that I`ve talked to before, he
doesn`t know how to read. I would help him learn how to read but - I
really don`t know how to teach that so I`d probably have my daughters
tutor come along and help me. Also research ways in how to
successfully help him get off the streets - financially helping him with
doctors appointments, clothes, food, shelter - etc.
#8   Take business classes at college.
#9   Hire a savvy business advisor
#10 Purchase things to get my office in order
#11 Purchase the Canon 5D, Canon Mark II DS, at least 5 "L" series lenses,
a 4x5 camera (don`t know what brand yet - but I`m sure it`d be the top of
the line) and maybe an 8x10 camera.
#12 Purchase at least 12 studio strobes - probably Elinchrome because I
just love those lights.
#13 Purchase and restore this old building in the downtown part of Las
Vegas to it`s shining glory and use it as my studio and run my business
from there (that would be so awesome - love the building)
#14 Hire an assistant who is also business savvy
#15 Fly back every summer to Indiana with my daughter and let her sleep
in my old bed with the windows open - just so she can hear the
whipporwhils sing at dusk, the crickets chirp at night, and the daily
shipping train in the distant background at like 3am - that`s my favorite
sound in the whole wide world! Also to let Strawberry, blueberry &
raspberry picking be her first "paycheck" jobs - then detassling corn be
her real "big money paycheck" job (at least that`s what I thought at 13!)
To be able to walk with her out in the dirt trails after it rains to hunt for
Indian arrowheads like my dad with me. To watch the Blue Jays fight with
the squirrels over the peanuts we throw outside with the birdseed - and
of course be watching all of this from the kitchen tabel during dinner in
front of the sliding glass door. To see my daughters face the first time
she sees a cardinal. To hang out with her at the peewee ball games and
go get tons of not good for you candy from the concession stand. To be
able to build a bonfire in our backyard (and not have to worry about
getting a ticket for it because it`s legal out there) together and make
smores while my dad sneaks up on us with the gorilla mask to scare the
living daylights out of us.   (I swear Craig if you write this stuff in a book
you better dedicate that book to me! All of this is true!! Never realized
how much I miss the little things of my childhood til I wrote this! ) All of
this #15 is priceless to me.
#16 take piano lessons and cello lessons
#17 take German,French & Spanish language lessons
#18 Teach Spanish speaking people to learn how to speak english.
#19 Help create a program that assists all undocumented aliens to
become legal citizens of the United States - a real program - no red tape
program.
#20 Lobby our government about making it mandatory for any juvenile
starting in the public system to have an age appropriate, decent
understanding of the english language both spoken and written - why
you ask?   Well I had this huge rant of a soapbox all written out, but I
erased it. Many of us who live in an area with a lot of spanish speaking
people know what I`m talking about. I`ll just leave it at that.
#21 Create child/parent friendly programs to help these people learn
english.
#22 Lobby our government about making it mandatory that our children
are educated in at least 2 other languages from the time they are in
kindergarten until the time they graduate.
#23 - I would guess I`m running out of money at this point? If I had
anything left over I`d pay off my house, and purchase a new car.
#24 OH!! ALMOST FORGOT. Go after that pig,,, er um, I mean guy (can`t
think of his name off the top of my head) -- the one that creates those
"Girls Gone Wild" videos and put him out of business for good. He is a
cancer to society. I realize it probably won`t solve the probelm -- young
ladies - you need to respect yourselves enough to not do those kinds of
heinous acts. When did our society turn that women have absolutely no
self respect? I don`t know how to fix that.

How`d I do?


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JM

As I said in the original post, I intend to offer a mirror to everyone`s mind as to their understanding of money and large numbers. Lots of people use the expression "lots of money," or "win the lotto," as if they know what they`d do with that money. I don`t believe it`s true.

I would then make the argument that if you don`t know exactly what you`d do with a million, ten million, twenty, or a hundred million dollars, the likelihood of your ever acquiring it is slim.

People waste entire lives wishing they were rich, or blaming everyone or everything for bad luck and the fact they`re not rich. They claim the rich stole the money, or the rich use up too much free money that`s lying around, leaving not enough for the rest. They say the rich should be shackled and punished for having more than "their fair share."

In fact, the people who demand the government do things to make everyone rich are asking for a redistribution of wealth by force---socialism, or a form thereof.

Money is created by effort and will to create it. Money is a result, not a cause. Money is a man-made symbol that only reflects a different reality. ANYone can be rich if they choose to be, but it requires a desire for wealth and money. To have that desire means also to know what they would use the money to accomplish. This post is an opportunity to put into actual words those things.

Note that in some of the initial posts there are lots of vague ideas about what to do with this money, yet no prices. I would argue that in such cases the term "a new car" means anywhere from $1500 to $5-million, with no real comprehension of anything larger than a few thousand dollars.

Dream a big dream! Imagine a large vision! But to imagine it, to dream it, means to make it REAL in that imagination! And to make it real, you have to understand the framework of this reality we all live in.

Ask a 5-yearold what it means to be rich; to have a lot of money, and they`ll respond either that they want a hundred dollars or a million-billion-gazillion dollars. But ask a modern adult what it means, and a depressing number of people will say that $60,000 is rich.

We have people here who want to run a business, and the supposition is that they`ll require startup capital. What does that mean? What`s the sell-point for the business? How many people can comprehend that to someone like Deloitte & Touche, a "small" business is one with annual revenues of $100-million?

I`m not even asking about having $100-million every year! I`m only asking about how to spend a one-time windfall of just $20-million. :-)

Interesting, given the nature of the windfall and requirements of this thread this is what I would do. However, if I were to acquire that money by other means this may not be the course I`d follow, at least not just yet.

That said, I would put the entirety of the money in a non-profit organization created and directed by me. Then put it to work on ‘safe’ investments i/e US Treasury Bonds getting a 5% annual rate of return (or better). That would give me a disposable income of $ 1 million on a yearly basis. That money would be invested in startup businesses, acting pretty much as an Angel Investor. The people I would choose would be on an ever expanding circle of relatives starting with me. Every person would get one chance at starting his/her business the investments would be between 50k and 200k so I could probably help start 6 or 7 businesses per year. No doubt some of these businesses would fail and some succeed, for tax purposes the losses from the failures would likely offset the profits that are earned from those that succeed, so most of the returns would be tax free, then those profits too would be reinvested into the core of the fund adding to the disposable income to be used to fund future startups. The fund could also be used to give loans to pay for college tuition, and be paid back at a pre-arranged rate of return.

Within a 20 year period most of my relatives would have had a chance at creating a successful businesses. I would strongly encourage them to devote a percentage of their income to continue funding the nonprofit ever increasing it’s grasp. Guess a good motto for the organization would be ‘United we stand, divided we fall’. 

:-) Excellent, Eli. I can see the plan of it, and understand the application of the $20-million. As you said, this particular game supposes a windfall, as opposed to working for the money, or some other method of gain.

Again, it`s my suspicion that an important reason why so many people aren`t rich, don`t have a lot of money, and wish they suddenly had a lot of money is that they haven`t sat down and manipulated large numbers. To be rich, one has to think rich. But to believe or imagine that $50,000 is "a lot of money" isn`t thinking rich.

Another very interesting aspect of this, is how most people, when they become or envision being very rich, discover that "the next step" is to broaden their perspective and start looking at ways to improve life on the planet. This isn`t at all "charity," and it isn`t altruism (sacrificing for someone else`s benefit). It`s simply a combination of boredom and self-interest.

In other words, after we`ve gotten so much money that our lifestyle is ensured for the rest of our lifetime, then what? What do we DO with our time? And that`s when the real interest in life becomes life itself, and what we can create and build.

I would immediately pay off my sisters` mortgages and outstanding bills, my mortgage and outstanding bills, fund college tuition for all nieces, nephews and my child, start a foundation for angel investing, start a foundation to provide ongoing food and services to Nevada Safe Place (an organization serving homeless youth of Nevada to which I already donate bags of groceries), I would find a way to fund perhaps whole communities of small homes for $100 and 1000 hours of community service available first to battered, abused, or homeless people and to all children 18 and younger.  I would give significant sums of money to the Gilda Radner Foundation for research on ovarian cancer and provide CA-125 blood tests (which test for cancer markers) to underpriveleged men and women.  I would provide for me so I can live comfortably for the rest of my years without worrying about losing my job or my (future) business and I would provide for my family the same way.  Any remaining money would be put into an income-producing account hopefully netting 8% or more and that money would be used to fund raises for my local grade-school teachers and police force.

Ok, so that`s at least a start -- 

Jillybeans

I`d buy a large house in the country with a large grass airstrip and collect open cockpit bi-wing airplanes.  I`d have a large barn to entertain in.  Decked out in the nicest amenities but for the most part look like a barn.  Stage for a band, a couple bars, oh and a place for kids to play.  That would about take care of it. 

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Travis Tschepen
Hibachi Bros. LLC

--My goal in life is to be as good of a person my dog already thinks I am.--

I would use part of the money to help rebuild parts of the south devastated by Hurricane Katrina.

Part of it would go to my brother`s foundation to help people with Down`s Syndrom.

Some of it would pay tuitons for my nieces, nephews, daughter, sons so they can have a good education.

The rest I would spend on paying off my house, further developing my current business, go into business as a dealer to sell electric & hybrid/alt fuel cars, set up a wind & solar generator on my property and catch up on about 125 books I`ve been trying to finish reading!



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Scott Watson.::.

Acme Data Online Backup Service     

Don`t Wait Until It Is Too Late To Recover Your Data

Okay, now everyone who`s posted...take a look at what you`re intending to do with this money, then note the lack of pricing.

It`s my contention (can`t prove it) that although many of us sort of put money into pockets, that isn`t enough. For example, how much would MNGrillGuy`s house in the country cost? How much does 1 airplane cost?

Jilly, when you add up all those outstanding mortgages, how much do they total?

Some of this is coming from the SUN Bookclub thread, where "Think and Grow Rich" is under discussion. The book speaks to the fundamental issue of knowing *in detail* what it is you want. I believe that knowing how much things cost, and running a "tab," so to speak, begins to clarify those desires.

It`s also my contention that people who really want to be rich, also know how much things they want will cost. That`s not to say that people posting here without prices don`t know anything! Instead, I`m supposing that they don`t really want to be rich---they have something else as a priority instead.

Another part of this comes from my own thinking lately, as I`ve followed the "Value statement" thread. I`ve never had much money, but I`ve always made the same types of decisions. I wondered what it is that`s driving those decisions. What I began to see is that I`m trying to prove, I guess, that there still is a viable opportunity for the Ideal to exist in today`s world.

My decisions have been prioritized on ideals, rather than always on the practical or pragmatic. I`ve done what I had to, when I needed money or to keep a working job, but it`s not been a priority. As such, I`ve had a satisfying life, so far, but I`m conflicted about how much money do I want. It seems I don`t really want to be rich.

It`s that conflict that rests below the surface of ordinary consciousness that I`m exploring. What really is each person`s true motivator, in other words---the founding principle by which they make all their life decisions.

Comments? :-)