If I Won Lotto

$20,000,000

Let's start with the big one. It's the most fun and most impactful amount. There are often $20 million lotto draws in my state, and these happen to be the ones I most often enter. Generally, they're drawn once a month, and this gives me a month to decide mentally how I'd divvy it up. It's also a month's worth of mental enjoyment...until the day after the draw and I get no "You're a winner!!" email. It's entertainment in much the same way that people buy phone apps, games, or movie tickets.

With this amount of money, the ultimate goal is to never need to work again, and I feel that "should" be possible with this amount of money. I'd also feel like somewhat of a failure if I just blew it like so many other lottery winners you hear about. I don't think I would stop working. Working doesn't need to be paid, but I wouldn't just sit around all day doing nothing. I would probably work part time, or maybe just do some volunteer work. I think it's good for the mind to have something to do, and I think it's good for the soul to help others.

What I would NOT do

Firstly I'll explain what I wouldn't do. Some of these might seem odd or counter intuitive but let me explain my reasoning.

Won't necessarily pay of all my debts

I wouldn't necessarily pay off all my debts straight away. I don't really have any "bad debt" - things like credit cards, car loans, etc. I have a mortgage, which I'll call "good debt". Some would argue my mortgage or investment loans aren't "good debt", but to me they're not "bad" in the same way as high-interest credit cards or other expensive debt. Hopefully my property is appreciating in value, unlike a car. On top of my home loan, I also have as some investment loans, which I'll also call my "good debt". Again, they're a tax offset and hopefully the investments are either providing dividends or growth value.

I have an offset account for each of my loans, which means I could drop money in there to essentially pay off the loan without paying it off. This means that I can still access the money if I need it and I'm not paying interest on the remaining balance. So I see it as a rate of return to the value of my mortgage interest rate.

Remember, I want this to last forever (the longer of my life or my partner's life equals forever, not literally forever), so spending needs to be done in a controlled way. If I were to pay off all my loans straight away, there is a large chunk of money that is gone from the pool, reducing my capacity to earn interest on it. At least this way it may not be making me money, but it is certainly stopping me from paying money in interest.

Would not buy a big fancy car/boat/house

I would not buy an expensive car, house, boat, pretty much anything. I might one day, but only after I have "saved" for it using my monthly "income" from investment returns, or from the monthly allowance it'll pay us. This comes back to controlled spending and self-control.

Would not quit my job

I wouldn't quit my job immediately. For one thing I would get bored, but also my partner would go nuts if she didn't have something to do. You might think "oh you've got so much money, you could do anything you want", but I think working, at least for part of the year, is good for the mind and gives you purpose.

Would not tell anyone

This would be difficult because I'd be quite excited, but I would try as hard as possible to not tell anyone; essentially because I don't want people, siblings, parents, or friends, to come begging for money. I would definitely tell my partner, but I would ask her to keep it quiet as well. I might choose to be quietly generous - give money to people who need it, without revealing where it came from. We have done this in the past and given friends money when we thought, or they've specifically mentioned that they needed it, but we tried to do it as anonymously as possible. Don't think I'm trying to toot my own horn here, I've only done it a couple of times, but it did feel really good to help someone out.

Would NOT go on a spending spree

I've pretty much covered this one previously and it would go against my "controlled spending" strategy, and I want this money to last. I think that's enough said on this one.

Would NOT give my children a large sum of money

I don't think anyone should ever just give their kids everything they want. That's how you breed entitled little brats. I've seen it done where mum or dad grew up poor and they decide to give their children everything that they couldn't have when they were growing up. On the surface, it seems like a nice idea, but it's not. The kids don't learn the value of money, of having to work hard, of saving and waiting for things.

Now, I'm not a complete prick, I would give them some money, but it would also be in a controlled way. I might setup a trust fund or start to put money into an investment account for them so they can watch it grow and learn about investing and compound interest, and the like. But there would be limits on when they can take it out; maybe they have to wait till they're 30, when they've worked hard and started to become an adult, but not so old they can't just enjoy the money. Or once they've saved a certain amount for themselves, then they qualify for the payout. Whatever the rules, they would have to work and wait to get it.

Whatever amount we choose to ultimately set aside for them, it would be enough to be a nice bonus, not a "retire now" kind of amount. This is our money, not theirs, and if we do it right, they'll get a fair share when we're gone, or too old to enjoy it anymore.

What I WOULD do

Here comes what I think is the fun part. This is where I outline what we could do with the money. Remember, I want this to quietly last forever giving us the comfort to know that we never have to worry about money again.

Wear The Same Clothes

I quite like most of the clothes that I wear. I'm not really all that fashionable, but I might try a little harder. Either way, I would continue to wear jeans, t-shirts, baseball caps. I might just buy better quality ones from now one. What I would certainly try to do is buy ethically sourced clothes, where the people making the clothes are treated fairly and paid a reasonable wage.

Home Renovations and Improvements

There are a few things that I wish I could do to my house. We made a few mistakes when we built it. It was the first time we'd built and didn't really know what we were doing. Some of the design choices we made were sub-optimal. I would like to fix these things.

The Garden

I would not get a gardener. I like getting out and mowing the lawn, so I wouldn't pay someone to do that for me at my current age but would get someone to design a nice garden with the land and plot we have. We tried, but again don't know really what we're doing, so have made some mistakes. I would probably get someone to come and do the work for me as I don't have all the equipment to do everything we'd like to do.

When the house was built, the "landscapers" did a terrible job with preparing the ground for turf. I would get the grass underlay replaced with a decent 20cm deep sand/soil mix and get new quality turf laid, nice and level. The watering system would have to stay; there's no way it or the plants would survive without it.

We have a 3,000L water tank taking up space in the yard, so we'd also get rid of that one and put a bigger underground tank, because why not?

Remove a wall

On the original house plan, there was large room, that we foolishly added a wall in the middle of to make two rooms: a study and a second study/sitting room. This was a bad idea. This created a load bearing wall, and we'd like to reconfigure it to make it a nice big theatre room.

It would not be cheap to deck it out the way we want it. Roughly $20-30k to remove the wall and fit it out with sound proofing, etc, $20k for the sound system. I might get a projector to replace the TV we have now which would add another $5k-10k to the budget. A gas fireplace for the atmosphere, around $10-15k, maybe a bit more when you consider plumbing for the gas, etc.

Donate To Charity

Would donate money to charity; These are the charities I would donate to: Compassion, my local church, 1 other that I can't remember. I've thought about this before and I had another in mind. At the time of writing, I can't remember the name though. If I won the full $20 million, we'd probably give away about $5-10 million. We might do it as a lump sum, or setup a large recurring amount to do over time. We'd get some financial assistance on the best way to do this.'

Keep Investing

I would definitely keep investing money in a variety of ways: This would be following my current investment strategy but instead of investing $1,000 each month, I'd ideally invest $100,000 each month.

Create More Time

There are things in everyone's life that, if they had the money, they wouldn't do, and they'd let someone else do it for them. I have a few of these listed below.

Get a Cleaner

Sometimes I get motivated, and I vacuum the house. It's not as often as it should be done, but I do it, and I don't mind doing it. Obviously, I'm not one of those people who like doing it so much that I do it every day. So, if I won a sizable amount of money and it fits in the budget, I would hire someone to come and clean the house every week.

This is non-negotiable. This would probably be one of the things I would make sure was covered.

Get a Personal Chef

The next biggest change in life if it fits, is to hire a personal chef. I haven't figured out the logistics of this one yet. Maybe it would be just some kind of meal-prep service so that we didn't need to cook every night. It's not that we don't like cooking, it's more the decision of what to cook, getting the ingredients, etc. We could just meal plan ourselves, but there are many days when we just don't feel like cooking, but if someone is cooking for us, that would always be better I think.

Automation

I like to automate things, especially money. I would automate organising the pest guy to come, every 12 months, automatically send him a text message to come round. Things like that.

Invest In Myself

Health

I don't get enough checkups done. I know that I should get an annual physical done, get to the dentist, etc. I just don't do it. I'm not scared, I just don't, and I'd like to change that.

This might just be a habit that I get into without the additional lotto win. That is probably a better idea than waiting for lotto, as the win may never come.

Relax More

I really like going on holiday. It clears my mind and I start to imagine again and get invigorated for the few months after the break. It takes me a few days to switch off, but by the 3rd day, I'm relaxed and thinking clearer and enjoying my time away.

There are so many beautiful places around the world that I would like to see for real, and not via a Google Images search. We would apportion a chunk of money to holidays or just short trips away.

Give away My Car

As mentioned above, I don't want to spend the money too quickly. I want it to last and so I would start a "savings" plan to replace my car. I have in mind a couple of cars that I would like for different purposes, and so when the saved money for the first one of those becomes available, I would have my current car fully serviced, replace all the fluids, tyres, etc, and then give it away to someone who needs it. It's an 8-seater Toyota Tarago, low KM's and good interior.

It may sound modest, but when we were younger with a budget under $10,000, finding a six-seater car was a real challenge. It wasn't easy and if someone had offered us this back then, it would have made a huge difference. Less stress, less issues with breakdowns, etc, etc. It would be nice to pay that forward.

Fixed Monthly Income

I've mentioned this idea through the document. We would put the money somewhere and have the investing automated, the transfer for our weekly spending automated. That way we would know that each week we get $X and can decide how to spend it that week.

We don't want this money to disappear through impulse buying or just being silly with it. I did some quick sums using one of the many online savings-draw-down calculators. You can play around with things like initial sum, return interest rate, inflation, tax, etc.

The numbers I plugged in may not be realistic, but here they are and they seem mostly ok:

• $10,000,000 lump sum
• Returning 8% per annum
• 3.3% inflation
• 20% tax rate
• $40,000 PER MONTH to spend
• 40.7 years of income

At this stage, I can't imagine that we'd spend $40k every month, and I'm also hoping to live for more than 40 years from now; fingers crossed. This is a good set of rough numbers. Hopefully inflation stays low, the tax is minimised through some legal method, and the returns are more than 8%.

Having not had this kind of monthly allowance before, at first, I can't imagine we'd spend that much, so we'd probably spend part of it and then invest the rest. This would then increase the amount we have, etc, etc. It may not take long to increase spending to match our newly acquired means but I'd try to limit that.

It probably wouldn't take too long, if invested in the right places, to live off the interest and dividends, not the money itself. That's the ultimate goal here.

$100,000

Not everyone can win the jackpot. The local jackpot was recently (2024) up to $300,000,000! I assume this means that the lower division winners take home larger amounts too. If that happens, I want to be prepared too.

$100k is still a sizable win, obviously not as life changing as $20 million, but still potentially life changing so it's worth exploring here.

Initially I would leave the money sitting in an offset account against our mortgage. This is a very conservative approach, and I admit it would not create the best returns, but it would be a consistent ~6% "return".

Because there doesn't seem to be any tax advantage by having a mortgage on your principal place of residence, it seems best to pay this loan off first. This assumes you have no credit card or other debts to your name. If you have those, pay those off first. We don't have any of those as we only use Visa debit cards.

We use a cost-averaging investment strategy: putting a fixed amount into the market each month, regardless of whether it’s up or down. Sometimes when the market is going down, we put in a bit more to take advantage of the falling prices, when it looks like the market is rebounding, we reduce it slightly. If $100k came along, we would probably increase the monthly amount that goes into our investment portfolio. This should create a decent return on investment with dividend returns and allow us to pay off the mortgage quicker with returns into the future.

A very safe, boring, conservative course of action would be to leave the full amount in the mortgage and not touch it. This would save roughly 10 years off the mortgage. While this would work, it's not very exciting and would not help our overall quality of life too much. For this reason we would probably also take a monthly holiday allowance. Set an auto-transfer to the holiday fund so that we could take some short trips away to rest and recuperation. This would be offset against the mortgage giving a two-fold return; minimising interest paid, and the mental feeling knowing that a holiday is coming as something to look forward to.

$10,000

This amount would give you a nice boost, but not enough to really change your life. Not that I'm trying to brag, but it wouldn't change my life that much. It's an easy amount to spend, and if you eeked it out over 1, 2, 5, years, you'd end up with an extra $5 in your pocket each week. Maybe a bit more, but it wouldn't be much. An extra dinner out each week/month. For this reason, you might as well enjoy it.

Again, I would leave the money to offset against my mortgage until the time comes to go on a small holiday. We'd like to go to New Zealand for a few weeks. This wouldn't cover the full amount, but if I could get a $10k injection, it's better to find $20k extra than $30k extra to fund the holiday. :-P

$20

We've covered the bigger amounts, but what would I do with the small $20 win. This amount generally goes straight into the online lotto account, and I generally just leave it there till the next $20,000,000 draw is on, hoping to start at the top of this document again.

Final Comments

While I've described what I would do with the money from a lotto win at different levels, the same could be applied to any extra cash that comes our way, or yours, inheritance, work bonus, etc.

Don't be the person that is in the papers a few months later under the headline "Lotto winner now collecting welfare payments!" or "Lotto Money All Gone in 6 Months!"

• Be careful.
• Don't spend it all at once.
• Get some financial advice. Preferably fixed price advice, not ongoing payment advice if you can avoid it.