$1 Million vs $10 Million

[gmillerdrake]

Saw this question pop up on a social media platform....curious what everyone's approach would be.

[gmillerdrake]

Assume this is 'after tax'......so you're bringing home $1mil or $10 mil

[gmillerdrake]

I went with $1mil in hand. At this stage of my life, I'd just work another 10 years and not touch the million and let it accumulate interest. If I were a bit younger I'd probably flip the coin.

[lordxizor]

$1 million guaranteed is a complete life changer. We could either invest it and retire in 5-10 years. Or use it to buy the dream home we want right now. Sure, $10 million would allow me to never work another day in my life (which I'm not sure I would want), but I'd rather take the sure thing in this scenario.

[Indiscipline]

I'd take 1mil, for 100ml I'd flip the coin.

[lonestar]

1 million...that'd settle my retirement.

[El Barto]

That's enough to keep me in a decent house with a nice car for the rest of my days, with enough left over to do the same for my mom, and her similar number of days.

[wolfking]

1M.  I could live off that comfortably with what I already have.

[pg1067]

This is just a simplified version of Deal or No Deal, except there's no banker's offer (which, in this case, would be about $5.8M).


This is where I'm at:

I went with $1mil in hand. At this stage of my life, I'd just work another 10 years and not touch the million and let it accumulate interest. If I were a bit younger I'd probably flip the coin.

[hefdaddy42]

I would flip the coin. If I lose,  I am no worse off than I am now.

[gmillerdrake]

I would flip the coin. If I lose,  I am no worse off than I am now.

My initial thought was this as well. Then I started to analyze it a bit more and I sided with the guaranteed $$$

[pg1067]

This also reminds me of an episode from the initial run of Who Wants to Be a Millionaire.

The show in the U.S. began while I was in my second year of law school, and my wife and I watched pretty regularly.  The show had questions of increasing difficulty and increasing dollar value.  Once you correctly answered the $1,000 question, you were guaranteed to take home at least that much money.  Same with the $32k question.

One day, we were watching, and a fellow classmate of mine turned up on the show.  He did really well and got to the $32k level pretty easily.  He correctly answered the $64k and $125k questions correctly, but he had burned through all three of his lifelines.  They revealed the $250k question, and he clearly didn't know the answer.  The smart move would have been to walk away with the $125k, but he blindly guessed and got it wrong.  His stated rationale was that wasn't losing anything, but that just demonstrated why he wasn't at the top of the class.  He had $125k in his pocket, so while he still got $32k, he pissed away $93k on a 1 in 4 guess.

This choice is basically the same.  Yes, in walking away with nothing, you're no worse off than you were before, but once you've been presented with this choice, you have a guaranteed $1M, so you're risking that money on a 50/50 chance.

[TAC]

Taking the Million in hand. Not even a choice.

[bosk1]

Gary, please Venmo me the $1M.  Thanks for asking.

[wolfking]

I would flip the coin. If I lose,  I am no worse off than I am now.

That's true, but a mil in the hand is easy, quick cash you had to do nothing for, and significant enough not to warrant the risk.  If it were say 100K or flip for 10mil, now there's a more interesting question.  I'd definitely be more inclined to flip.

[wolfking]

Gary, please Venmo me the $1M.  Thanks for asking.

So sorry boss but I already flipped and got the 10M, so.......you may have to wait for yours.  Gary's funds are a bit tight after giving me my 10er.

[Herrick]

Herrick would take $1,000,000.

[hefdaddy42]

This also reminds me of an episode from the initial run of Who Wants to Be a Millionaire.

The show in the U.S. began while I was in my second year of law school, and my wife and I watched pretty regularly.  The show had questions of increasing difficulty and increasing dollar value.  Once you correctly answered the $1,000 question, you were guaranteed to take home at least that much money.  Same with the $32k question.

One day, we were watching, and a fellow classmate of mine turned up on the show.  He did really well and got to the $32k level pretty easily.  He correctly answered the $64k and $125k questions correctly, but he had burned through all three of his lifelines.  They revealed the $250k question, and he clearly didn't know the answer.  The smart move would have been to walk away with the $125k, but he blindly guessed and got it wrong.  His stated rationale was that wasn't losing anything, but that just demonstrated why he wasn't at the top of the class.  He had $125k in his pocket, so while he still got $32k, he pissed away $93k on a 1 in 4 guess.

This choice is basically the same.  Yes, in walking away with nothing, you're no worse off than you were before, but once you've been presented with this choice, you have a guaranteed $1M, so you're risking that money on a 50/50 chance.

Yeah, well, when I got offered this choice in real life, maybe I will choose differently.

But maybe not. A million dollars would be awesome, and certainly make some things easier, but it's not quit-my-job money.  Ten million is, though.

*shrugs*

[Herrick]

This also reminds me of an episode from the initial run of Who Wants to Be a Millionaire.

The show in the U.S. began while I was in my second year of law school, and my wife and I watched pretty regularly.  The show had questions of increasing difficulty and increasing dollar value.  Once you correctly answered the $1,000 question, you were guaranteed to take home at least that much money.  Same with the $32k question.

One day, we were watching, and a fellow classmate of mine turned up on the show.  He did really well and got to the $32k level pretty easily.  He correctly answered the $64k and $125k questions correctly, but he had burned through all three of his lifelines.  They revealed the $250k question, and he clearly didn't know the answer.  The smart move would have been to walk away with the $125k, but he blindly guessed and got it wrong.  His stated rationale was that wasn't losing anything, but that just demonstrated why he wasn't at the top of the class.  He had $125k in his pocket, so while he still got $32k, he pissed away $93k on a 1 in 4 guess.

This choice is basically the same.  Yes, in walking away with nothing, you're no worse off than you were before, but once you've been presented with this choice, you have a guaranteed $1M, so you're risking that money on a 50/50 chance.

Yeah, well, when I got offered this choice in real life, maybe I will choose differently.

But maybe not. A million dollars would be awesome, and certainly make some things easier, but it's not quit-my-job money.  Ten million is, though.

*shrugs*

Agreed. I'd still have to work but at least I could retire at an earlier age if I got my leetle hands on that $1M right now.

[Phoenix87x]

A bird in hand is worth 2 in the bush

[Grappler]

$1 million guaranteed.  I could pay off my house, provide for my kid's college tuition, buy a new car and have plenty of money leftover to save.

[ProfessorPeart]

$1 mil. Pay off the house. Get a decent car and bank the rest including possibly a good chuck of what would have been my mortgage payment every month. I milk that million for all it's worth.

[axeman90210]

I'd take the $1 million. I'm hoping to buy a house next year, I'd pay cash for something and then continue on with my regular life just reaping the benefits of not having rent or a mortgage in my monthly budget.

[Cool Chris]

I am totally retiring if I get $1M. Are you guys thinking that won't last you, or do you just like your jobs that much? I have too many regrets in life; I don't think I could live with knowing I passed up a guaranteed $1M.

[XJDenton]

Definitely the guaranteed cash. That's enough to make a nest egg and buy a decent property to live in outright. I mean, you definitely wouldn't put 1 million down on black at the roulette table if it was all you had right?

[lordxizor]

I am totally retiring if I get $1M. Are you guys thinking that won't last you, or do you just like your jobs that much? I have too many regrets in life; I don't think I could live with knowing I passed up a guaranteed $1M.

I'm 42, so $1 million definitely wouldn't allow me to retire instantly and maintain my current lifestyle. If I were a decade older it might be enough.

[Stadler]

This also reminds me of an episode from the initial run of Who Wants to Be a Millionaire.

The show in the U.S. began while I was in my second year of law school, and my wife and I watched pretty regularly.  The show had questions of increasing difficulty and increasing dollar value.  Once you correctly answered the $1,000 question, you were guaranteed to take home at least that much money.  Same with the $32k question.

One day, we were watching, and a fellow classmate of mine turned up on the show.  He did really well and got to the $32k level pretty easily.  He correctly answered the $64k and $125k questions correctly, but he had burned through all three of his lifelines.  They revealed the $250k question, and he clearly didn't know the answer.  The smart move would have been to walk away with the $125k, but he blindly guessed and got it wrong.  His stated rationale was that wasn't losing anything, but that just demonstrated why he wasn't at the top of the class.  He had $125k in his pocket, so while he still got $32k, he pissed away $93k on a 1 in 4 guess.

This choice is basically the same.  Yes, in walking away with nothing, you're no worse off than you were before, but once you've been presented with this choice, you have a guaranteed $1M, so you're risking that money on a 50/50 chance.

But isn't that more of a philosophical question?  I think from the standpoint of the moment you walked in that door to the studio, with your life, your decisions, your budgets, your hopes, your dreams, you have nothing.   By your logic, as soon as you hit the first question, you should run. 

[hefdaddy42]

I am totally retiring if I get $1M. Are you guys thinking that won't last you, or do you just like your jobs that much? I have too many regrets in life; I don't think I could live with knowing I passed up a guaranteed $1M.

It won't last. I mean, I love my job, but I don't love it enough to keep working if I won enough money that I didn't HAVE to keep working. $1 million is not enough.

[El Barto]

I am totally retiring if I get $1M. Are you guys thinking that won't last you, or do you just like your jobs that much? I have too many regrets in life; I don't think I could live with knowing I passed up a guaranteed $1M.

It won't last. I mean, I love my job, but I don't love it enough to keep working if I won enough money that I didn't HAVE to keep working. $1 million is not enough.

You emphasized HAVE with good reason. I don't mind my job but I truly hate that if I lose the job at the wrong time in this shithole country I may well wind up living in a tent under a bridge. The single best thing that I've done in twenty years is winding up with enough money in savings that I could get by unemployed for ~15mo. Among other things it means if I truly get pissed off enough I can just walk away. This job is an asset but it's not an existential necessity. That piece of mind is invaluable. As it pertains to this, online savings accounts are currently paying a tad over 5% right now. That means a tad over $5k/mo right now. If I were in your situation I might not be able to retire, but having an extra 60k/yr worth of income would be a massive game changer.

[pg1067]

I am totally retiring if I get $1M. Are you guys thinking that won't last you, or do you just like your jobs that much? I have too many regrets in life; I don't think I could live with knowing I passed up a guaranteed $1M.

There are three variables:  (1) whether you use any of the money to pay existing debt and/or buy things; (2) the rate of return on the portion of the money you invest; and (3) your monthly expenses.  Obviously, there are a lot of factors, but $1M likely runs out in about 16-18 years.

This also reminds me of an episode from the initial run of Who Wants to Be a Millionaire.

The show in the U.S. began while I was in my second year of law school, and my wife and I watched pretty regularly.  The show had questions of increasing difficulty and increasing dollar value.  Once you correctly answered the $1,000 question, you were guaranteed to take home at least that much money.  Same with the $32k question.

One day, we were watching, and a fellow classmate of mine turned up on the show.  He did really well and got to the $32k level pretty easily.  He correctly answered the $64k and $125k questions correctly, but he had burned through all three of his lifelines.  They revealed the $250k question, and he clearly didn't know the answer.  The smart move would have been to walk away with the $125k, but he blindly guessed and got it wrong.  His stated rationale was that wasn't losing anything, but that just demonstrated why he wasn't at the top of the class.  He had $125k in his pocket, so while he still got $32k, he pissed away $93k on a 1 in 4 guess.

This choice is basically the same.  Yes, in walking away with nothing, you're no worse off than you were before, but once you've been presented with this choice, you have a guaranteed $1M, so you're risking that money on a 50/50 chance.

But isn't that more of a philosophical question?  I think from the standpoint of the moment you walked in that door to the studio, with your life, your decisions, your budgets, your hopes, your dreams, you have nothing.   By your logic, as soon as you hit the first question, you should run. 

No.  First, there's a big difference between $100 and $125k.  Second, unlike most game shows, Millionaire let you walk away with no penalty after seeing the question.  Also, in the early days of Millionaire, getting to the $32k level was usually pretty easy.  At any stage, there was no downside to at least looking at the next question.  If you know it, then you're golden.  If not, then you try your lifelines.  If you have no more lifelines and don't want to roll the dice on a guess, then you walk away.  Once you've hit the $32k level, you're guaranteed at least that much, so there's NEVER a risk in guessing at the $64k question.  If you hit it, then you move on.  The guy from my class had $125k and was facing a question to which he didn't know the answer.  He chose to roll a 4-sided die.  The reward was $125k, but the risk was $93k.  Saying, "well...I've got $32k more than when I got here," is just bad economics.

[T-ski]

I’ll take the million and set off into the sunset. I’m ten(ish) years from retiring, and investing it puts me well over what I need.

[KevShmev]

This is a no-brainer for me.  Take the money (the 1 million) and run. 

[bout to crash]

Definitely the million! Pay off my condo, take some time off work to travel and invest some.
Oh and buy some kind of exotic animal, Cage-style.

[gmillerdrake]

Oh and buy some kind of exotic animal, Cage-style.

"Hi everyone....thanks for coming over! It's been so long since we've hung out....here...come here real quick....you have to see my Porpoise, he's got the cutest blow hole"

[PMSummer]

If I had to choose, I'm leaning towards the coinflip for 10 million. I get it, a guaranteed million sounds nice and safe. However the expected value of that coinflip is 5 million, and I'm all for taking a chance at something bigger of it's statistically the best choice. With the way retirement costs are skyrocketing, a million might not even cut it these days (although it would definitely help).