Seriousness New Money, The Smart thing or the Fun thing?

GlenBarrington · 03-01-2011, 06:33 AM

The classic conundrum, money out of the blue. Not a huge amount, but enough to make one ponder.

My brain says "401K catch-up - Save! You're not getting any younger'.
My heart says, "Yee Haw! New Camera!", or "Yee Haw! More chrome for the motorcycle!".

This isn't about me, it's about you. Where do you REALLY fall on this sort of thing? Do you have the self discipline to do the smart thing?

Sweetpea · 03-01-2011, 06:39 AM

I'd split it. Not necessarily 50/50.

We have one state lottery here. If you win, you will get some profession help about what to do with that money. One thing they say is: go spend some of it. Just buy that thing you've always wanted to buy but never could (naturally, that depends a bit on what you won). The rest you can sensibly invest in some way.

If I would win a decent amount of money, not a huge amount, but enough to make one ponder, I'd get that car I've been wanting ever since I knew it came out. It's not a huge car, but a hybrid version of a model I've loved from the first time I've seen it. I would also let the driveway be done (there's a water tank that needs to be removed underneath it) and maybe let the lawn be equalized. The rest I'd put away, in such a way that the government will get the least amount

dsvick · 03-01-2011, 09:04 AM

Quote:

Originally Posted by Sweetpea

I'd split it. Not necessarily 50/50.

Me too. Depending on the amount I'd definitely put aside as much as I could, but I'd also keep enough out to pay off 90% of our debt, on the assumption that I'd then be able to invest more into our retirement.

But there would be a really nice vacation involved, and a motorcycle, yes, definitely a motorcycle.

MJK2111 · 03-01-2011, 09:10 AM

GB - you can NEVER have too much chrome on the bike! Go for it!!

DixieGal · 03-01-2011, 09:14 AM

Glen, darling, I am currently accepting donations

DixieGal · 03-01-2011, 09:26 AM

Seriously, we inherited pretty well when my parents passed away. Previously, we had good jobs and saved lots while keeping no debt, except for the mortgage. We paid off the mortgage and saved some and invested some in biotech stocks.

2008 was tough. we lost $1000 per day when the market crashed, but we took what we could get and cashed out. But we had plenty in protected accounts, so it was not a big deal.

However - and this is the thing I've been getting to - while every second home is in foreclosure, we will never have to worry. Using that inheritance to pay off the mortgage gave us freedom. It might be something to consider with your new money.

BTW, I blame all of you for my biggest stock loss. There I was buying up Krispy Kreme stocks, and you guys went on a diet!

Sweetpea · 03-01-2011, 09:55 AM

Quote:

Originally Posted by DixieGal

However - and this is the thing I've been getting to - while every second home is in foreclosure, we will never have to worry. Using that inheritance to pay off the mortgage gave us freedom. It might be something to consider with your new money.

That would depend on where you live. For me, it would be more prudent to put the money away, and get the required amount out of that account every month to pay the mortgage bills.

If we were to pay off the mortgage, instead of getting money back, we would have to pay money as you pay taxes for property but get a tax reduction for a mortgage

CyGuy · 03-01-2011, 10:21 AM

Do you want to retire earlier so you can ride that bike more often? I would put as much in your 401K as you legally can, and put the rest into a savings account. Let that money make more money for you! The more money you have, the more money you make. Compounding interest really is magical, but you want it working for you. Compounding interest working against you is very very difficult to get out of. Pay off your debts and save the rest!

Kumabjorn · 01-13-2012, 01:38 PM

My mother passed away two months after she started to receive her pension, government made a huge windfall from that considering that they would (if she had lived to be 83.6 which is the average life expectancy) have to pay out a total of $300,000, after that I'm spending what i have.

TGS · 01-13-2012, 01:47 PM

Buy stuff!

03-01-2011, 06:33 AM	#1
GlenBarrington Cheese Whiz Posts: 1,986 Karma: 11677147 Join Date: Jan 2010 Location: Springfield, Illinois Device: Kindle PW, Samsung Tab A 10.1(2019), Pixel 6a.	New Money, The Smart thing or the Fun thing? The classic conundrum, money out of the blue. Not a huge amount, but enough to make one ponder. My brain says "401K catch-up - Save! You're not getting any younger'. My heart says, "Yee Haw! New Camera!", or "Yee Haw! More chrome for the motorcycle!". This isn't about me, it's about you. Where do you REALLY fall on this sort of thing? Do you have the self discipline to do the smart thing?

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03-01-2011, 06:39 AM	#2
Sweetpea Grand Sorcerer Posts: 9,707 Karma: 32763414 Join Date: Dec 2008 Location: Krewerd Device: Pocketbook Inkpad 4 Color; Samsung Galaxy Tab S6	I'd split it. Not necessarily 50/50. We have one state lottery here. If you win, you will get some profession help about what to do with that money. One thing they say is: go spend some of it. Just buy that thing you've always wanted to buy but never could (naturally, that depends a bit on what you won). The rest you can sensibly invest in some way. If I would win a decent amount of money, not a huge amount, but enough to make one ponder, I'd get that car I've been wanting ever since I knew it came out. It's not a huge car, but a hybrid version of a model I've loved from the first time I've seen it. I would also let the driveway be done (there's a water tank that needs to be removed underneath it) and maybe let the lawn be equalized. The rest I'd put away, in such a way that the government will get the least amount

03-01-2011, 09:10 AM	#4
MJK2111 FUBAR! Posts: 1,946 Karma: 15018767 Join Date: Mar 2010 Location: Woodstock, IL Device: Kindle 3, Samsung Galaxy Note 10.1 S	GB - you can *NEVER* have too much chrome on the bike! Go for it!!

03-01-2011, 09:14 AM	#5
DixieGal Hi There! Posts: 7,473 Karma: 2930523 Join Date: Feb 2008 Location: Ft Lauderdale Device: iPad	Glen, darling, I am currently accepting donations

03-01-2011, 09:26 AM	#6
DixieGal Hi There! Posts: 7,473 Karma: 2930523 Join Date: Feb 2008 Location: Ft Lauderdale Device: iPad	Seriously, we inherited pretty well when my parents passed away. Previously, we had good jobs and saved lots while keeping no debt, except for the mortgage. We paid off the mortgage and saved some and invested some in biotech stocks. 2008 was tough. we lost $1000 per day when the market crashed, but we took what we could get and cashed out. But we had plenty in protected accounts, so it was not a big deal. However - and this is the thing I've been getting to - while every second home is in foreclosure, we will never have to worry. Using that inheritance to pay off the mortgage gave us freedom. It might be something to consider with your new money. BTW, I blame all of you for my biggest stock loss. There I was buying up Krispy Kreme stocks, and you guys went on a diet!

03-01-2011, 10:21 AM	#8
CyGuy Avid Reader Posts: 769 Karma: 7777778 Join Date: Aug 2009 Device: PocketBook 902, Galaxy Tab 2 7.0, ASUS TF700, and Cybook Gen III	Do you want to retire earlier so you can ride that bike more often? I would put as much in your 401K as you legally can, and put the rest into a savings account. Let that money make more money for you! The more money you have, the more money you make. Compounding interest really is magical, but you want it working for you. Compounding interest working against you is very very difficult to get out of. Pay off your debts and save the rest!

01-13-2012, 01:38 PM	#9
Kumabjorn Basculocolpic Posts: 4,356 Karma: 20181319 Join Date: Jul 2010 Location: Sweden Device: Kindle 3 WiFi, Kindle 4SO, Kindle for Android, Sony PRS-350 and PRS-T1	My mother passed away two months after she started to receive her pension, government made a huge windfall from that considering that they would (if she had lived to be 83.6 which is the average life expectancy) have to pay out a total of $300,000, after that I'm spending what i have.

01-13-2012, 01:47 PM	#10
TGS Country Member Posts: 9,058 Karma: 7676767 Join Date: Feb 2010 Location: Denmark Device: Liseuse: Irex DR800. PRS 505 in the house, and the missus has an iPad.	Buy stuff!

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