'£50 now or £1,000 in ten years?' poll discussion

Former_MSE_Lawrence Former MSE Posts: 975 Forumite
edited 20 April 2010 at 9:12AM in MoneySaving polls
Poll Started 20 April 2010:

£50 now or £1,000 in ten years?

Are you focused on short term or long term cash? Suppose you were offered the following choice (with a rock solid government-backed guarantee that provided you’re still alive you’ll get the cash).

If the alternative was £1,000 in ten years time, please select the FIRST you’d be willing to take.

A. £10 now
B. £50 now
C. £150 now
D. £250 now
E. £500 now
F. £750 now
G. I’d wait to get £1,000 in 10 years' time.

Please vote here, or click 'post reply' to discuss below. Thanks :)



  • raj75
    raj75 Forumite Posts: 444 Forumite
    I am not sure everyone understood the question..
    Over 40% people voted for £750 now.. I don't think those 40% will say they don't need "£500 now" instead of "£1000 in 10 year time".
  • minerva_windsong
    minerva_windsong Forumite Posts: 3,808 Forumite
    Short term is a relative concept - I would quite happily wait, say, a few months to get the £500 rather than taking it now. To me, anything within a year is 'short term', a year to five years is 'medium term' and beyond that is 'long term'.

    Then again I suppose it depends how much you need the cash as to what you'd take when. I went for £500 now as that would help out my 'saving to move to London' fund massively, but the £1000 in ten years would probably end up in savings as well, so how much difference it makes to me personally I'm not sure.

    /pointless post
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  • djb77
    djb77 Forumite Posts: 17 Forumite
    If you factor in inflation at say 3% on £1,000 in 10 years in would be the equivalent of £740 today and therefore, I voted for F.
  • ThinkingOfLinking
    ThinkingOfLinking Forumite Posts: 11,828
    Part of the Furniture 10,000 Posts Combo Breaker
    £750 today. ;)
  • King_Weasel
    King_Weasel Forumite Posts: 4,381 Forumite
    To prefer £10 now you would need a discount factor of over 58%, but to prefer £750 now it would be 2.92%. So if you think annual inflation would average more than this you should certainly go for option F. Option E (£500) has an internal rate of return of 7.2% compared with G, so I would rule out A to E.

    I'd almost certainly go for £750 now.
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  • pinkshoes
    pinkshoes Forumite Posts: 19,868
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    edited 21 April 2010 at 6:16PM
    Assuming I could manage to make a 5% return each year by investing it, then £614 would give me approximately £1000 in 10 years time, so I'd accept anything over this to save the hassle of investing.

    (Thus the only option was the £750 NOW option)
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  • MSE_Martin
    MSE_Martin MoneySaving Expert Posts: 8,273
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    Interesting readin - i will try and clear it up so everyone understands its the first option.

    I note the analysis above - but what about the

    A. I need it now feelings some will get (especially those who it could help clear debt)
    B. The risk of dying before the payout if you wait.
    Martin Lewis, Money Saving Expert.
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  • Lokolo
    Lokolo Forumite Posts: 20,861
    Part of the Furniture 10,000 Posts
    I am taking £500 now as I reckon I could double it in 10 years. Thus making it the more financially viable option!

    I don't need it now, I just would like it as its the obvious choice for me.
  • Diesel44
    Diesel44 Forumite Posts: 623
    Part of the Furniture 500 Posts Combo Breaker
    Who in their right mind would turn down £750 now.
    Anything government backed must be unreliable. I think I would take now and £750 was one of the choices so whats wrong with taking £750 now, why wait 10 years for an extra £250.
  • DarkConvict
    DarkConvict Forumite Posts: 6,343 Forumite
    The poll needs to be more spread out.

    You have a massive gap of 10 years between F. and G.
    £500 now or £750 now, taking £500 is losing you £250 for no reason at all.
    If the opens were more like £10 now, £20 in 3 weeks, £50 in 2 months, £100 in 6 months etc. It makes more sense.
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