What would you do with a million dollars? Perhaps you’d pay off debt, buy houses and cars, or put it into the stock market. Regardless of what you do, there’s always that chance that you’ll either spend it too quickly — or lose it. People who stay millionaires understand that it’s always a smart choice to only spend what’s necessary for your circumstances, but that doesn’t always work for everyone. The thrill of having that much money can often go to people’s heads.
You’re so excited to finally be able to buy whatever is needed for a happy life, so I can imagine how quickly that money could be spent. One Reddit user decided to ask millionaires around the world how they lost all their money, and the answers don’t disappoint. Keep reading for an in-depth look at how former millionaires decided to spend their money and what finally broke the camel’s back and caused them to lose everything. Afterward, check out these real-life stories from people who share what everday items made them rich.
20. You Need To Diversify
Reddit User KlownPuree had an interesting story to share about his father. “My dad, not me. He made some shrewd stock market investments after he retired. They were options on an oil refinery at a time when the USA had a real shortage of them. My dad had done a lot of research on this and studied the situation carefully. He got rich to the tune of maybe $2 million. He could have been set for life. My dad was already a really smart guy. He has a Ph.D. in mathematics and was a highly respected big-brain professional back into the 1960s.
“However, he thought this took him to the next level. He bought a lot of newer options in the same company. I suggested to him that he diversify, put a bunch of money into something closer to an annuity or another conservative investment that would give him plenty of income forever. I told him if he did that, he would always be rich. Well, he is pretty far from that now. I haven’t said a thing about that to him since he lost everything. I did what I could, at the time, to save him from himself. But who was I? It pains me to see how it played out for him. He did a lot of things right in life. He deserved better, but there’s no “deserve” in securities investing. Morals of this story: You aren’t an investment genius after your first blockbuster win. You need a track record. Diversify.”