Rich Now or Rich Later?
For Marie Holmes, the decision was to be made between the lump-sum choice of $127 million, or a total installment amount of $188 million. Like most of us would do in that situation, Holmes picked the lump sum so that she could be rich right away. Do you think that was the right decision to make?
Most financial experts would agree; it may seem like it’s better to eventually have more money in the long run, but this is not true. If you were to take the lump sum straight up and invest it wisely for 30 years, it would have been worth more than the entirety of the installments. Of course, this is only possible if you actually invest the money carefully, instead of indulging in exorbitant spending.