What Would You Do With $8.5 Million If You Won The WSOP?

Tonight’s the night we find out who wins the World Series of Poker Main Event! The showdown is between Darvin Moon with 59 million chips and Joe Cada with 136 million chips.  Despite the chip differential, players know that things can turn quickly in heads up poker.  Anybody with enough patience, and a good amount of luck can win!

I’ve imagined winning the WSOP countless times. Each time I ask myself two questions:

1) If I had to choose between winning and only getting the WSOP bracelet or losing but receiving the prize money, which would I choose?

2) What would I do with $8.5 million bucks?!

The answer to question #1 is easy. I’d take the money for sure!  I’d then use $10,000 of the prize money to have a jeweler craft an exact same replica.  It must feel unreal walking around as the champ, but I’d rather have financial security any day.

The answer to question #2 is a little bit harder, but much more fun! First of all, we can painfully reduce the $8.5 million by 50% to get our after tax proceeds.  $4.25 million is still a lot of money, but gosh darnit, that sure sounds a lot less than $8.5 million!

The Katana: Favorite Articles Of The Week Ending 11/8

katanaI have to admit, it takes a little more for me to get excited about topics in the personal finance arena because there’s generally a consistent rehash of themes we all know we should be doing, like spending less than you earn.  I’m also guilty of this, and that’s why whenever something is fresh, or teaches me something new (I have a lot to learn) I get excited.

From my end, I try and write whatever is on my mind at the moment, and hope it’s never been written before.  I highlight 8 articles of the week.  Is yours one of them?

FAVORITES OF THE WEEK:

I Saw My “FlashForward” And It Was Beautiful

flashforwardIf you haven’t seen ABC’s latest hit show “FLASHFORWARD”, you better microwave some popcorn and allocate several hours to catch up online!  The basic concept is simple: every single person in the world blackouts at the same time, and most have a flashforward, or a vision of their future of what they are doing for 137 seconds.

The tricky thing is that some didn’t have a flashforward, which presumably means he or she will die beforehand.  Your flashforward isn’t exactly what it seems either.  For example, you could be popping champagne on a yacht, but that doesn’t mean you’re a billionaire.  It could just mean you’ve been invited to a company party and you’re still mired in debt.

Samurai Reflections of October & Goals for November

"Fall" by Step Into Color

“Fall” by Step Into Color

Just like that, another month has come and gone.  I’m determined to make November as productive a month as October.  Who’s with me?  Below is a recap of October and what’s in store for this month.

HIGHLIGHT POSTS FOR OCTOBER:

“We’re Ignorant Idiots!  Tell Us Why A Flat Tax System Isn’t Fair!” - Is the first post to break the 100+ comment barrier as folks argue passionately about why we are ignorant idiots!  Thanks  Larry, Roger, Steph, Fredt, Matt, Kevin, BG, FB, Jon, Mike, Wookie and all of you for chiming in so passionately!  The key takeaways from the comments are: 1) Most are opposed to a flat tax system for some odd reason :) 2) An introduction of a “wealth tax” and/or “national sales tax” seems more equitable but frankly unfeasible 3) The really rich pay less taxes because most of their income comes from long term capital gains which is currently being taxed at 15%!

“What Renting DVD’s Teaches Us About CD Yield Maximization” - This is an original concept that slaps traditional CD laddering strategies in the face.  It was interesting to see the post picked up by The Bogleheads forum and debated there since those guys are usually hardcore on financial issues.  The bottom line: Regardless of the interest rate environment, one’s CD money should always be invested in the longest term duration possible.

“Party Like It’s 1999!  10 Key Takeaways From This Recession” - The recession is officially over as we grew 3.5% year over year (YoY) in 3Q09.  As we move into 4Q09 and 1Q10 results season, earnings will see a material YoY pick up partly due to low comparables from 3Q08 and 1Q09 levels.  Accepting the economic recovery is one thing, but investing new money in the markets at these levels is another.  I’m staying very defensive as I believe November is going to be another volatile month, vulnerable to a pullback.

“The Worst Seat On An Airplane Is The Best Seat In The Office” - This is a very simple but highly effective concept for those in offices who wish to increase their recognition.  If ever you have an office move, or see a spot near the rest room, take it!  You can buy me a beer 1 year later when you become the most popular guy in your office.

“The 30/30/3 Principle For Home Buyers To Follow” - Home buying is such an emotional decision, to counteract irrational thinking, we offer a simple guideline to follow before mortgaging your life away.  If everybody followed the 30/30/3 principle, we never would have had such a blow up in the economy.  In fact, the government should introduce a bill mandating a minimum amount of financial fitness before people can spend a multiple of their yearly income on housing.

GOALS FOR NOVEMBER & WHAT’S IN STORE

Forbes Forgot A Key Ingredient For Becoming A Billionaire

Forbes came out with a fun article highlighting the 5 ingredients helpful for reaching billionaire status.  Shockingly, 3 of the ingredients pertain to me, yet I’m far from big bucks wealthy.  The only time I ever made a move towards Warren Buffet status was last November when he lost $9.6 billion on paper and I lost less.

Maybe I'll wear the tie on Monday Steve.

Maybe I'll wear the tie on Monday.

5 Key Ingredients For Becoming A Billionaire

1) Have parents with math-related careers.

2) Born in September.

3) Dropped out of college.

4) Member of a secret society like Yale’s Skull & Bones.

5) Worked a stint at Goldman Sachs.

I remember sitting next to Steve on a plane ride from Shanghai to Hong Kong 5 years ago.  The first thing I thought was, why is he flying commercial?  The second thing I thought was, I guess he really did have a lot of acne growing up!  Sorry Steve, I’m just being honest.  He was hosting a big Forbes-sponsored conference and he started going on and on about the emergence of growth in Asia.  He gave me a pep talk and said, “FS there’s no stopping what you want to do, so just go out there and grab it!”

We exchanged business cards, his saying “CEO, Editor in Chief of Forbes Magazine,” mine saying “Waterboy At Your Service” and we went about our separate ways.  Eight months later, I get an unceremonious Christmas present in the mail with a tie that says, “Corporate Tool.” Thanks Steve, what a trip!  At least you got me thinking about your flat tax mantra that generated so many comments this past week.

There’s a 6th ingredient for becoming a billionaire Steve forgot to mention.  That’s simply to be like Steve and inherit it!

Hope everybody is having a good weekend.

Related Post:

“The Less You Have The Less You Have To Lose”

“Bank of Mom And Dad: Should We Spoil Our Children?”

Keigu,

Financial Samurai – “Slicing Through Money’s Mysteries”

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