Dreaming: I won a lottery
Let's imagine I won $20 million in the lotto, after taxes.
To begin, not even my closest friends would know about my gains. This is a surefire way to create more problems in the future.
I would immediately save $500,000 to pay for a top undergraduate and medical school education. There is no reason why I should decline the opportunity to retire with the money. Because I aspire to live a normal life with a normal family and have the security of a stable income. So why not? I've always had a strong interest in medical.
As long as I'm still in high school, I'd gladly part with my hard-earned cash in order to spend it on items that would enhance my quality of life and make it more enjoyable. Would you like to go to supper with me? A new Acura or Mercedes SUV would be a good investment for me. A good set of golf clubs.. Rolex or something of the sort is possible. During the summers of high school and college, I'd also set away some money to take my family on nice vacations. All of this, plus the $500,000 in educational expenses, comes to nearly $1 million.
I now have a medical degree and $19 million in the bank. When the time is right, I hope to begin my own private practice. That'll cost us $500,000.
Likewise, I'd prefer not to fork over any cash if I can avoid it. I don't want to pay interest on a mortgage, so I'll spend $1.5 million on a lakefront home. If we're dreaming, we can also buy a $200,000 family boat for weekend use.
In my ideal situation, my pay would cover all of my living expenditures, travel, and vehicle expenses, including my car(s). We have $16.8 million in the bank. ' For an undisturbed emergency fund, I'll put around $2 million into the pot.
For the remaining $15 million, I've come up with an intriguing plan. In the suburbs of Houston, Dallas, Oklahoma City, St. Louis, and other Midwestern cities, you may find well-maintained homes for around $250,000 each. After taxes and costs, I would be able to buy 55 properties with this $15 million.
Why would I use the balance of my savings to buy 55 properties in the suburbs? Rental properties are in high demand in these areas. There is little doubt that a well-maintained home of this kind would rent for $2,300 a month. Consider a 10% management charge, which works out to $2,070 per month for each home. About $115,000 each month works up to about $900,000 a year after income and property taxes. A constant $900,000 income will be waiting for me when I retire after 20 years of owning the properties. For the rest of their life, my family could benefit from this. It's a smart financial move.