This story seemed to have gotten people debating about the lottery winnings in Quebec where apparently a winner had a choice between getting one million dollars at once or $1000 per week for the rest of her life. In this case, she opted for $1000 a week. She is only 20 years old so I can imagine the thought process is how she has a lot of time and eventually she will get more than one million dollars. At $1000 a week, it should take between 19 to 20 years to earn one million dollars. That’s not too bad considering again the person is young and is still going to have a regular career too.
But this has resulted in people grilling her decision such as how with one million dollars you could invest that in so many ways to earn more money. For example, leaving it in some GIC. What caught my attention though is that she apparently mentioned that she will use the winnings to save up for a home. If she is currently renting that kind of makes the decision puzzling as owning your own home is probably a wise investment strategy here. I would think in twenty years you would save at least $245,000 or so from the rent alone. Or worst, if during this time imagine she purchases a home with a mortgage. Again, it would make sense to it take the million.
This is not like the penny doubled everyday for thirty days scenario where the difference is so substantial to the point where it’s silly to not take the lower initial amount. However, even in that case we are talking about a month not years. You just never know how the future will end up in that time too where so much can change. Housing is a great example here where the cost has ballooned so much that it was better to buy place years ago. In that regard, it’s better to take advantage of the million I say and try to set yourself up for life.