To think a Million pounds isn't actually that much?

[BernardlookImaprostituterobotf]

To me it might as well be a million billion but -

Reading the story about another couple who won £1.8 mill lottery prize but are now worse off than before as they are bankrupt.

They bought a £750,000 house - ok, just over a mill left.
They bought 2, I think, sports cars - hmm, you'll be under a million now.
Both gave up work - on under a million?
They both financed independent business projects - I've lost the figures now but I'd be worried.
They both haemorrhaged money and yet the daily spending was on 'investment piece' £1500 bags, expensive guitars & a generally luxury lifestyle - but how? With what money?

In their specific case, she was left in the shit & I do have sympathy for the situation they're in now and have used them more as a general example of what I'm trying to articulate.

Do people ignore financial advisors? I don't understand how you can sink 3/4 or a million in a house and then expect the remaining money to support a luxury lifestyle if you don't work.
Surely you can either not work and live frugally trying to make good investments or you can keep working and the extra lifts you into luxury.

You can't buy a mansion and a yacht for a million quid but this seems to be how people spend it.
Aibu to think it's not much now? What would you do with it?

Big houses cost a lot, even after they're paid for. Council tax, gas electricity, water, all much more expensive. Then unless you want to end up doing loads of cleaning and gardening you need to hire people to do those things, and furnishing a big house nicely doesn't come cheap. Then there's maintenance of things like trees, gutters, windows, at some point the bathrooms and kitchen will need replacing.

It's all very well having a big house, but paying to maintain it to a decent level needs an above average income.

You cannot live like a millionaire on a one off sum of one million pounds, even a million a year doesn't necessarily mean private jets and ocean going yachts.

1 million annuity buys about 25k a year pension.

YANBU - I reckon if you wanted to both give up work in your 30s/40s, then you need £5m.

£1m would set you up, give you options, but I don't think DH could give up work completely on a £1.8m lottery win. It's certainly not a big house and sports car/s and not working amount of money, it's an amount for one of the 3.

I think that's what I mean really but haven't expressed well.

It's clearly a lot of money but it really isn't the means to live the lifestyle of a 'millionaire' from the day you win until the day you die.

I absolutely could live a wonderful, comfortable life with plenty left over.

I just wonder where the disconnect comes from? I remember thinking a million would mean loos that flushed with champagne and bedsheets made out of £20 notes, but I was 6. I can understand feeling like Croesus but when you do the sums surely it's there plain as day?
I can't remember where I saw it but there was an advisor saying to make it last you would need to take £20,000 or less per year - I do quite well with budgets but I can't run a Maserati, 10 bed pile and dinners at the Ivy on that! Even with no mortgage.

I thought you got bundled into a room & had it all laid out for you?
But looking at the spending I think you'd need about £20 million...which is quite a different ball game.

My house is worth 525k - it's a nothing special 3 bed house. ( London area I admit ) to buy a really nice 4 bedroom I'd need to pay around 650k, maybe more.

It does depend where you live, but around here 1 million isn't a fortune by any stretch of the imagination.

From what I read they could have lived comfortably off the interest alone if they'd not been so daft.

Ah cross posted with Marcus more accurate number.

Around here a 5 bed will go for up to 3 mill depending on the acreage.

The road where i used to live the houses rented for £800 a month. You could buy them for £145k each. So if you used £1million for a house outright and other nice things, you could buy 5 of these houses (and have £50k contingency left) and rent them out. That would give you £3k a month to live on after tax. Say bills were £1k you would have £2k left. I could happily live on that

Nearly £2 mil capital can set you up for life, but not straightaway. There'd be some work involved.

You could buy yourselves a modest-ish house and use the rest to start a buy-to-let empire in a university town.

Or salt away half and use the rest to set up or buy a business and work hard to build it up.

But you'd have to be very stupid to spend it all acquiring assets that didn't return an income and give up work. That way lies certain bankruptcy.

If I won £1.75 mil I'd pay off my mortgage (not much) and rent out the house for the ££ you get round here now, buy a nice house in a cheaper area for no more than £500k, get a Subaru Outback or similar nice family wagon, stash the rest in investments and keep working. Hey presto, life-changing amount of money, security, enough to help the kids.

Giving up work early what do you do? And what example is it to children if the parents are rattling around at home poncing about with sports cars and guitras??

Sorry, guitars.

Oh my goodness, I lied - I've found anywhere from nearly 10 (although that had 6 bedrooms) but you could maybe rent the shed for a few months.

But there are 15 properties before the price drops to 3 million.
You will get a comfortable, average, house paid off with 1.8 but country pile it is not.

Certainly, what you'd do is put 100k aside and do not touch it, in case you do mess it all up. Going bankrupt is ridiculous.

A million pounds is nothing to scoff at.

if I had £1.8 mill I would:

Buy a house at around £500k/600k a 4 or 5 bedroom place but not too over the top.

Buy a car for my Dad but not an overly swaggy one, but a new one so about £12k

We would both still work-- or at least when I start working after the littlies stage. If I had the extra money I'd have a little to fall back on if I was to start work earlier.

I'd put £25k in savings for my kids when they are older. If I have 4 kids, that would be £100k.

Go on a lovely holiday but not an overly flash one for a fortnight with my parents, sister and her partner and son, my partner and our daughter or subsequent children £8k-£12k.

So that would leave me with around £900-950k.

That would stay around if we needed help with anything. Also perhaps a £5k holiday a year with just our immediate family, perhaps £10k if we had a once in a lifetime holiday we really wanted to take.

Out of the 900k left I think I'd allot myself £50k I could use a year (unless an emergency, obviously) so that would go towards childcare for example.

I wouldn't want to be specifically lavish.

i used to work with rich donors. People would always ask who i'd met who were famous/on tv. They were incredulous when i told them that 'famous people' were not 'rich'. Well off yes, but not 'rich' in the league people think about. The people who donate a £100k- a million, are the Rausings, the Sainsburys, the Guinnesses. They are the professionally wealthy and spend their time donating their money for fun. Actors on TV, live in semi detached houses in Chiswick. It's not the same thing at all! (Still out of my league tho)

Yes was going to mention the interest. I read an article about them and the daily interest was £340 or £380 can't remember which. Of course you could live off that. I wouldn't buy a house outright I'd get a mortgage. It would have been more prudent to invest the money live off the interest never actually having touched a penny of the original sum.

YANBU. A million pounds is roughly my annual flower budget.

If I won a million (rarely do the Lottery but have a few grand in Premium Bonds, so it's unlikely, but possible) I would spend about £400k moving from our small flat into a nice 3 bed Victorian semi (our mortgage is already paid off), keep around £300k in safe investments so that I could afford to only work part-time, and divide the rest up amongst family and close friends. Sorted. Not that I've planned it at all

I completely agree Denzel.

I am sure I would make some stupid impulse buys but I couldn't bear to piss away that much in under 2 years.

yes I saw that story they were greedy and venal and could not add. I have no sympathy.

Thane

I'd buy this as I love this house, then I'd invest the rest. I drive past it feeling slightly envious.

Where would you keep it if you wanted to keep it as cash? The banks aren't safe and the govt will only reimburse you something like 83k per bank so you'd have to spread it about.

I'd buy this, it's just come on the market.www.fennwright.co.uk/homes-for-sale/search-homes-for-sale/100989025728/view/

Oooops, carried away there i'd buy this one

1m is a lot of money but certainly not enough to fund a lavish lifestyle without working.

You could either keep working and use the 1m to "upgrade" eg bigger house, treats etc - i.e. lavish lifestyle but you have to keep working

Or you could stop work and use the 1m to fund investments which would bring you in some income - but definitely not enough to be lavish on

Of course it depends on how old you are (how many years left to fund) and what you already own - if you are 65 and already own your house outright then an extra 1m probably is enough to live off lavishly for example.