Earning your first million dollars is an amazing achievement. However, it can be easy to lose your hard-earned money if you don’t spend it intentionally.
Some purchases, though, are worth the splurge. They include smart investments, life-enriching experiences and impactful contributions to society that will make you feel good about spending.
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Investing in Real Estate
Real estate is a steady, long-term investment. You can use the property either as your own home or as a rental, making it a versatile investment that can change with your lifestyle.
However, there are potential pitfalls with real estate. Some locations are more profitable than others, making the return on your investment variable. It’s also a very active investment, especially if you have tenants. Buying and selling real estate can also come with high commission fees and taxes.
Quality Health and Life Insurance
Reaching $1 million is the perfect time to add additional protection for your family’s health and welfare in a worst-case scenario. Make sure you have high quality health and life insurance, so you and your family are protected.
This means prioritizing comprehensive health coverage, even if it costs a bit more. Also, consider choosing a life insurance provider known for its reliability and timely payouts.
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Sustainable and Eco-Friendly Car
Buying an eco-friendly car may seem less fun than splurging on a supercar, but there are many good reasons to consider it. The hidden costs of expensive sports cars can cause an unexpected, massive drain on your finances in the long run.
Instead, consider some luxury choices in the EV field, such as a Tesla, but read about the cost of mileage and maintenance prior to buying it. Eco-friendly cars are not only beneficial for the environment but also much more cost-effective. Plus, owning such a vehicle may offer tax benefits.
When choosing an eco-friendly vehicle, consider your lifestyle and needs. There are options from fully electric to hybrid models. Look for their efficiency ratings and renewable energy usage. Also, double check the availability of charging stations in your area to ensure it’s a practical choice.
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Education and Self-Improvement
Having the means to educate yourself in your dream field is always worth doing, regardless of your age. Investing in education can boost your earnings over time and help you feel more fulfilled.
When pursuing further education, prioritize the quality and relevance of programs to your personal goals. If it’s for career advancement, check the success of graduates from that program. If it’s primarily for self-enrichment or pursuing your passion, look at schools and programs that are most aligned with your passions and interests.
Charitable Donations
Making a donation to a cause you care about is another great way to splurge when you make your first million. Many people go their entire lives hoping to make a difference in the world, and donations are a straightforward way to make that happen. This is especially true if it’s for a cause you personally care about.
When donating, choose a reputable charity. Do your research to ensure your contributions effectively reach your intended cause. A good website to find quality charities is Charity Navigator.
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Experiences
Studies have shown that investing in experiences rather than material goods is, more often than not, more fulfilling. So travel somewhere you’ve always wanted to see, attend a concert or start a hobby. Experiences offer personal fulfillment and happiness, let you meet new people and introduce you to new places.
Remember, meaningful experiences can be inexpensive, too. Sometimes, you may want to do careful planning and research before choosing an experience, and other times, you might want to try something spontaneous. Either way, the benefit of experiences comes from trying something you haven’t tried before.
High-Quality Home Improvements
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Finally, splurging on high-quality home improvements can have a dual purpose. First, it can improve your living space and make living in your home more enjoyable. Secondly, it can increase the value of your house in the long run.
When it comes to home improvements, remember to balance what you like and what potential buyers in the future would see value in. Also, work with reputable contractors and designers to ensure the work is completed correctly.
Final Thoughts
Making your first million is a huge milestone, and how you spend the money can change the course of your future. That’s why, instead of indulging in fast-depreciating luxury goods, consider investments that will meaningfully enhance your life. Options like real estate, boosting retirement savings or charitable giving offer lasting benefits and contribute to both personal and societal growth.
When you make thoughtful choices, your first million can take you far and make you feel good about your impact in the process.
