Powerball is at a record \$1.3 billion.  I spend a ridiculous amount of time daydreaming about such things.  Maybe too much.  If you’ve ever had a long car ride to get somewhere, you can eat up a lot of time with this.  It usually goes in phases…

1. The math.  I will spend a decent amount of time figuring out in my head what the prize would be in a lump sum…then after taxes.  Or, I’d wonder how much the annuity was broken down by 30 years, then after taxes, split by 12 months.   That’s \$43.3 million a year for 30 years with the annuity.  Then, I figure maybe we keep 2/3rds after taxes?  So that’s they 28.6 million.  Or, roughly \$2.4 million per month, TAKE HOME, for 30 years.  With this kind of money, I’d always take the annuity.
2. Who I’m going to help immediately.  I then have my monthly annuity budget and I start thinking who’s mortgage I can pay off.
3. The house.  With sick money, I suddenly feel the need to move.  I also figure I might want a few houses across the country.  I start thinking of where I want the houses.
4. The security.  If you win a billion dollars in the lottery, your family safety immediately becomes a concern.  I start thinking of the secret service detail or ex seals I’d be hiring.
5. What I’d do with my spare time….charity work?  Build a real estate empire?

The above items I could burn a 3 hour car ride like it was a 15 minute ride, so try it sometime!  Below, I’m going to tell you what I’d do with my winnings…hint: there’s a moat as part of my answer.

• Budget – we’re talking about \$2.4 million per month.  The lump sum is probably \$700 million, maybe \$400 million after taxes.  Most people would take the lump sum.  With that lump sum, I’d buy a \$150 million house, give away lots, and suddenly find myself unable to pay the taxes on the big house and be living in a van down by the river.  I would prefer the \$2.4 million every month because you can set a structured budget.
• Savings: each month, 25% (600k) of my money goes into savings.  Low interest, but I want to build up to a nice nest egg of \$25 million.   This  money will be my emergency money if all else fails.
• House(s): 10%. I will do a 20-30 year mortgage or so, which gives me \$250,000 per month on mortgage.  This is about 100 times more money than my current mortgage, so I’m going to roughly say that gives me about 100 times the buying power or around \$35 million for all properties.  I can live with that.
• Family/friends: 15% – this gives me roughly \$375k per month to help out family and friends.  Immediately, my closest relatives would probably get 5k per month stipend.  I’d also spend a decent portion of this money paying down their mortgages.  My uber close family will probably get 20k per month and the understanding that I’ll buy them houses and cars as money accumulates.
• Real estate tycoon: %25 – I’d spend roughly 600k per month on buying up properties for rental/rehab.  I’d partner with others.  While I’d be CEO and chairman of the board, I’d also have other on staff full time, such as a lawyer, CPA, real estate experts, etc.
• Services: 5% – my guess is I’m going to need a cook, someone to clean the houses, a lawyer on retainer, a CPA, a driver, and security detail – all of these could run about \$120k per month for a full time staff.
• Travel/fun: 10% – I’m not big on travel so \$240k per month could be used in a variety of ways.
• Mutual funds: 5% – while I’m putting money in savings/bonds (low risk), and while I’m also investing in real state (higher risk), I’d like to diversify and have some money going into moderate risk mutual funds for the long term.
• Give away: 5% – this comes out to roughly 120k to give away, and I’m not taking friends and family here.
• House(s) – with \$35 million in the budget, let’s look at some places I’d want real estate, and what kind.
• PA house – I have ties to the area I’d never leave every other weekend, so I’d need to have a moderately sized house here for roughly \$2 million.  You wouldn’t believe what two million could buy around here, but let’s try and look.  Coming in with 6 bedrooms and 7 bathrooms with over 11,000 sq ft and 2 acres at only \$1.5 mil…
• Now, how to spend \$33.5 million more?  My guess is the above house would be a house every other weekend, but it probably wouldn’t be my MAIN house.  My main house I would build in Berks/Chester county PA to be close to my family, but not be too far from my York, PA house.   The house above I think it probably listed for \$100 million plus, but I’d build mine from scratch and would not care about gold toilet seats.  I’d like the look and size of it and not need the ridiculous items that could make the price tag soar.    Additionally, cost of land can make these things cost a lot more.  For example, if this was built in a desert just outside a city, it might cost \$10 million.  If this was built on the far east of Long Island, it might be \$100 million.  So, location matters with this.  I’m going to budget \$25 million for this and it’s going to have the below features:
• Security – I want walls and a moat.  Sounds funny, but my compound will be heavily secured with multiple layers of defense.  Get some bricks and build me a 10 foot high fence around my property.  Put a moat on the front side of that.  I want a drawbridge over the moat with my security detail at the front checkpoint.  There will be a security office within my house on a sub-floor who monitor cameras.  In an ideal world, there’s a guy on a .50 cal up on the roof in the evening with a lot of open field between the brick wall and the house for easy spotting.  The main bedroom will not have a panic room, it will BE a panic room.  When you have a billion dollars, I believe the only way to ever get a good night’s sleep is to sleep behind 1 foot of solid steel and concrete.  I will have a security detail in the basement monitoring the house.  See, this house will be my castle, restaurant, and play land a la Billy Madison.  No need to travel all over.
• Pools – I want an indoor one and an outdoor one.
• Guest houses on property, which are like little villas.  Main house only needs about 10 bedrooms for family to stay over, friends and family with extended stay can live in one of the 5 guest houses which would be like 350k 4 BR houses on the 80+ acres or so.
• Golf carts everywhere.  Everyone will ride golf carts on paths to get around.
• Indoor tennis courts.  I love me some tennis, and in the northeast, it’s either 20 degrees out or 96 and humid.  So, a nice area for tennis.
• Bowling alley.  Why not have a few lanes for some fun nights?
• Chess  room.  It could be fun to have a room to play chess in, which is sound proof and has a theme…some chess boards, posters, etc.  I’d invite some of my chess friends over and we’d have two chess tables in there to play on in comfort and absolute silence.
• Music room.  I don’t play music anymore, but wish I did.  In any event, I’d have a sound proof room so I could play my trumpet and it would have a grand piano in there as well as I’d love to spend time learning the piano and practice it.
• Exercise room.  You have to have a nice room for exercise!
• Running track.  Most likely on the outskirts of the property, I’d like to have a several mile long track around the outskirts of the property.
• Restaurant/ballroom.  I’d like there to be a restaurant that’s open a good amount of time.  There would be a ball room where we could have large gatherings, and a more private and traditional smaller dining room for Tuesday night leftovers.
• Movie theatre.  I want to somehow get movies in the theatres at my house as well.  I’m sure there’s a way to do it with the right amount of money.  I’d like to have Friday or Saturday night movie nights with family/friends.
• Library.  I have probably read over 300 college text books in my life, and would love to be able to read a lot of the classics.
• Office.  You need an office to run an empire!
• Bar/billiards room.  I’d like to be able to have some of my crew over for a long weekend and tie one on at our bar and billiards room.
• Garages – need to have at least a 6 car garage.
• A kick ass outdoor grilling/fireplace area.
• An awesome kitchen to cook in.  While I will have a chef, I also want to cook myself somewhat.  Need 3-4 ovens probably!
• Florida condo- It gets cold in the northeast during winter, it might be worthwhile to have a decent Florida house.
• Maine cabin – When it gets too hot during winter time, it would be really nice to have 2 weeks or so a year up there in August.  Fishing on a lake, relaxing.
• San Diego condo – I am somewhat enamored by southern California.  I’d visit there a few times before any kind of purchase, but I’ve heard the weather here is perfect.  After my son graduates from medical school, this might be the place to go…
• CARS!!   Who hasn’t wanted some really kick ass cars?  Here are my favorite:
• Mercedes McLaren.  This is my more upscale car.  I’m not running to the grocery store in this, this might be a night out car.
• Cadillac Escalade.  I once owned a 2002 escalade and bought it used, but I still loved the damn car.
• Time – what would I do with all of my spare time? I’d probably spend a lot of time doing the following:
• Learning things.  I have a passion for learning.
• Spanish, French, Portuguese, Italian.  I am somewhat capable in Spanish now, and have some entry level work on French.  Spanish is very similar to Italian.  Portuguese sounds like French and Italian had a baby…
• Read all of the classics.  I’d probably spend 1 hour a day reading for enjoyment
• Music – would get back to my trumpet, but also learn the piano well
• cooking – I’d love to learn a lot more of the science end of food a la Alton Brown
• Movies – catch up on the latest movies
• Parties – once a month or two throw a nice party
• Entertaining friends.  Would love for a few of my friends to visit for a week or a long weekend.
• Real estate mogul.  Would love to spend a lot of time buying houses up, fixing them up nice, and renting out to turn profits.
• Charity.  I’d love to do things like hear about a waitress who is working 50 hours a week, has three kids, and one has a really bad medical issue that I could help out with by leaving a giant tip which would cover the costs.  That is something I’d like to do all the time, or at least once a day.  I’d feel too guilty with lottery winnings if I didn’t find people every week to help with it.
• Working out and eating healthy.  My guess is my trainer will be Svetlana, some ridiculously gorgeous Swede who kicks my ass into some pretty decent shape while my chef Reynauldo prepares some tasty and healthy fare.  I figure I’m good for about an hour a day in the morning to really get it going.  Maybe 7am-ish.
• Spending time with my family.  I’d love to be able to go to every event in my son’s life.  Sometimes duty calls, sometimes I would not necessarily love the idea of being at a swim meet for 10 hours in a hotbox pool.  For the little league baseball games, I like the idea of being able to be there…for everything!