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Riddle me this: imagine yourself enjoying a peaceful Saturday afternoon. You’re sitting on your back porch with your laptop, catching up on some articles at NoDebtPlan.net. As you contemplate how to invest your money — 401k or Roth 401k? — the doorbell chimes throughout the house. You meander to the door and find a stranger in a black suit waiting. It’s an older, wealthy looking gentleman holding two metal briefcases. He smiles.
“It’s your lucky day. In the briefcase in my left hand, I have $250,000. You can win that money, no questions asked, if you flip a coin and call heads or tails correctly before it lands.
However, in my right hand I hold another briefcase. You can take it without having to flip any coins. It holds $_________.
Which briefcase do you want?”
The real question I have for you today is, how much money does the second briefcase need to hold for you to take it over the first one? $1? $10,000? $249,999?
So, what’s your number? Leave a comment and we’ll revisit this post in a few days.
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9 Comments, Comment or Ping
Mike
I’d take the second briefcase if it contained at least $125,000 (I guess this would be equal to flipping a coin for $250,000). Otherwise I’d flip the coin and go for $250,000.
If I needed money, this would surely change my answer…
But the truth is I don’t bother answering the door unless I’m expecting someone; so I guess I’d get $0.
Apr 14th, 2008
Mom @ Wide Open Wallet
hmm.. this is very deal or no deal. I think if someone was standing at my door offering $25,000 I might have to take it. I know that is really low, but it would pay off my van and that would make a huge difference around here. UG.. but the $250,000 would pay off everything I own. Either way, $25,000 would be my tipping point.
Apr 14th, 2008
Jeremy Davis
I’m kinda with Mom on this. I’d take the second briefcase if it held enough to cover most my non-mortgage debts.
Plus, coins hate me.
Apr 14th, 2008
Amphritrite
Let’s see… tails never fails! (Kidding)
The second briefcase would have to hold more than $200. Why? Because $200 is the “extra” that I have after bills each paycheck, garunteed. For me, I’d love to double that number, even if it was only once. It also seems like the mark where a “small” amount becomes a “large” amount in my head.
Sure, I’d love for it to have $10K in it, so I could pay off my debt, but the lesson here is that greed does not become anyone. Never look a gift horse in the mouth. Always count your blessings.
If your blessing is worth $200 garunteed, then smile, thank the man, and take the money.
The other briefcase, with the quarter-of-a-mil in it is a dangerous proposition. Think about it like waking up in the morning and going, “Today, I’m going to find $5,000.00 on the street.” You either will, or you won’t. You have no power to sway the odds your way, and a yes/no bet is never, ever worth it.
The only upside to this scenario is that you haven’t put any money on the proverbial table. I could consider a coin toss for this and only this reason: I have nothing at risk. If I walk away empty-handed, I walk away with exactly what I walked in with.
Apr 14th, 2008
Lynnae
I’d take it if it were $20,000, because that would pay off all of our debts and give us a decent emergency fund.
If I were out of debt and had a comfortable emergency fund already, I’d be gutsy and flip the coin. I figure I don’t have anything to lose, so why not go for it all? I could buy a starter home with cash for $250,000. Anything less, and I’d still have to take out a mortgage.
Apr 14th, 2008
Stephanie @ PoorerThanYou
So the question basically is “how much money would it take for you to give up a 50% chance at $250,000?”
Probably $10,000. That’s would make a big enough dent in my student loans that I would feel comfortable getting on-campus housing, and stop driving my car, which is something I really, really wish I could do for my last year in school (for environmental reasons more than anything else - I hate having a 16 mile commute in an inefficient car, just because I can’t afford anything else).
Apr 14th, 2008
Seb
I’d have to say $100,000. It’d be enough to pay off our student loans, and the remainder would be used for 20% down on a house.
Hey, I can dream, right?
Apr 15th, 2008
Eric
$10,000 would probably do it for me. That’d be one hell of a day and an easy, large contribution to my retirement account. Anything less than that and I’d roll the dice.
Apr 15th, 2008
Patrick
First, I’d offer the man a beer. He must be thirsty after standing outside. Then I would sit and talk to him for a few minutes, kinda get to know him as well as you can get to know someone in a short period of time.
Then, since I have no idea why he is offering money to me, I would ask about his intentions for the money and why he was offering it to me. There must be a good reason.
Then I would probably just take whatever is in the other briefcase - mostly because I think the offer would be sufficient to meet whatever reason he is offering me the money.
I’m sure there is a mathematical number for the “correct answer,” but there is also the answer you would be comfortable with. I think I can make $1,000 relatively easily, nor am I in dire need for $1,000. So at that price, I would roll the dice.
I’m not sure what my tipping point would be, but if I had to put a number on it, maybe $10,000. Honestly, how often has someone just offered you $10,000 no strings attached? That would be difficult to turn down.
$250,000 is life changing money for 99% of the world, and it would be for me too. But would I turn down a guaranteed $10,000? Probably not.
Apr 18th, 2008
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