2 million bucks right now, or $4,000 every week for the rest of your life?

[Godless Socialist CEO]

4K a week. This isn't even hard.

 

[R.E.N. Spells Ren]

Coli Budgetary Analysts and their dcf projections always assume their investments won't blow up in their face. Cashflow is just as important

Yup...these nikkas don't get that tho, going by the shyt they're suggesting.

 

[Obreh Winfrey]

Yup...these nikkas don't get that tho, going by the shyt they're suggesting.

They fail to understand that wealthy people invest for cash flow (the 4k) rather than capital gains (2 million lump sum). I'll take a reoccurring payout any day.

 

[Bboystyle]

They fail to understand that wealthy people invest for cash flow (the 4k) rather than capital gains (2 million lump sum). I'll take a reoccurring payout any day.

yup. 4k a week would be a GODLY dividend for those trying to invest that 2 mill

 

[MalikX]

how are u better off with the 2 mil when u make that back in 10 years? after 10 years, u making more then 2 mil. How is that better?

OP even said u live 25 years minimum which = 5 million. so we saying 2 mill >> 5 mill now?

I don't really understand what you're asking but, I'll expound anyway.

In investment speak, money now is better than money tomorrow. You can invest that principal and grow it exponentially whereas you can't do that with money you don't have. Thus, the $2 million make sense. Only problem is people tend to be optimistic about all the profits they can make and dismissive over the risks. You could easily get your whole portfolio wiped out. Managing your portfolio is much easier said than done. Which is why OP asked if people would rather take the $4,000 because if you lost a good chunk of that $2 million on a stupid bet, you would've been better off taking the constant cashflow every week.

 

[R.E.N. Spells Ren]

They fail to understand that wealthy people invest for cash flow (the 4k) rather than capital gains (2 million lump sum). I'll take a reoccurring payout any day.

I wouldn't go that far, it really depends on the scenario...and, of course, the person.

For this scenario, give me the $4k/week

 

[Sonic Boom of the South]

you can die in a year or two with 2 milli as well.

unless u some out of shape or have an illness, youd be dumb not to take the 4k

this logic

 

[dennis roadman]

Inb4 people come in here talmbout how they'll take the 2 mill and somehow, through their superior intellect and money skills, flip it into an inter-generational empire

@penfield get in here

Someone named themselves after a Bush song

What do we do from here

 

[Alpha Male]

OK and

Do you not plan on being alive for more than 10 years from now?

i have no idea what the universe has in store for me in 10 years. honestly i would rather not wait for it.

i can just easily take the 2m now... flip it... and enjoy it.

 

[MalikX]

There's no right answer here by the way. But let's say OP gave yall this choice back in 2005. Yall take the $2 million. Decide to play the market. You're being safe. You bet on blue chip/value stocks. You brought some real estate properties too. Real estate is always safe. In 2008, you would've jumped off the nearest rooftop That's why Warren Buffet and Jack Bogle just tell nikkas to invest in index funds to save people from themselves.

 

[hayesc0]

There's no right answer here by the way. But let's say OP gave yall this choice back in 2005. Yall take the $2 million. Decide to play the market. You're being safe. You bet on blue chip/value stocks. You brought some real estate properties too. Real estate is always safe. In 2008, you would've jumped off the nearest rooftop That's why Warren Buffet and Jack Bogle just tell nikkas to invest in index funds to save people from themselves.

 

[pimpineasy]

Yeah, the problem with this is that everyone is going to use a portion of the principal, nobody is just going to leave it alone.

People need to understand there is no free lunch. No free returns without some risk. One year your returns could be - 10%

 

[-DMP-]

Ppl so defensive over their strategies, you can honestly state a great case for both.

 

[Perfectson]

which one are you taking?

No taxes for either one.

Assume that you're guaranteed to live for another 25 years minimum

I'm flipping that 2 mil so fast

mamba mentality

both are enticing and this kind of analysis is exactly what financial analysts get paid for.

there's companies like peachtree settlement that literally go around buying up peoples annuities and giving them lump sums and take on the annuities.

I did a quick excel and the different isn't too much more. YOu get between 200-300k more by taking the weekly payments (assuming its only for 25 years and 8% interest rates). Obviously , it depends on what you can do it with the money. 9.3% is the IRR where NPV is 0 (by definition that is what IRR is but some of you never passed alebra so have to explain it).

Anyway, if you can get 9.3% or more annually on your investment it would behoove you to take the lump sum.

 

[-DMP-]

both are enticing and this kind of analysis is exactly what financial analysts get paid for.

there's companies like peachtree settlement that literally go around buying up peoples annuities and giving them lump sums and take on the annuities.

I did a quick excel and the different isn't too much more. YOu get between 200-300k more by taking the weekly payments (assuming its only for 25 years and 8% interest rates). Obviously , it depends on what you can do it with the money. 9.3% is the IRR where NPV is 0 (by definition that is what IRR is but some of you never passed alebra so have to explain it).

Anyway, if you can get 9.3% or more annually on your investment it would behoove you to take the lump sum.

great post