I have a million dollars of disposable income. What should I do to best benefit the economy?
"At first, I thought this might be too broad.  There are of course thousands of things that you can do with your money to ""help the economy"".  But I think that there is room to discuss some broad strokes without trying to list a thousand details.   Regular investing (as you are now) helps the economy in that companies obtain money by selling their stock.  They can then use that money to fund expansion, etc.  These things can help the economy permanently.  Of course, they can also use the money to pay executive bonuses, which don't help the economy so much.   Similarly, just spending money does not normally help the economy.  Unless we are in a recession, it is mildly harmful to spend wastefully.  Money that could be going to support long term improvements in production instead is used to buy a luxury that doesn't terribly interest you.  I.e. if you don't want a bigger house or a more luxurious car don't buy it to ""stimulate"" the economy.   Many charitable donations have the same problem.  They help short term consumption somewhere.  And of course the charity starts asking you for more money.  Many charities waste most of a donation trying to get another one from the same person or family.   Sir John Maynard Keynes proposed that the best thing that people could do to help the economy is to invest in things that cause economic activity in turn.  He was mostly talking about things like roads, bridges, and dams that are out of the investing range of most people, so he wanted governments to do it, particularly during a recession.   So we are looking for ways to invest in durable improvements that will support economic activity in the future.  A million dollars is a small amount for many things, but there are some activities that work.  I'm going to list a few examples, but there are certainly others:   Fund microfinance.  Basically loan your million dollars to people who need a small amount of money.  These programs often allow you to determine the initial recipient and then that person determines the next recipient.  A million dollars can finance hundreds if not thousands of these loans.  They may be in the United States or in a developing country.   Set up a scholarship.  My recommendation would be to find an existing scholarship with a few recipients and ask them to add one a year for the million dollars.  A million dollars should typically produce about a scholarship a year in returns after inflation.  Of course, that's just regular inflation.  Education inflation is higher.   Solar prize.  Fund a program that gives out one solar installation every year or five to a family that owns a house, is struggling to pay utilities, and makes a compelling case.  Basically, whenever the investment grows enough to support it, make a new prize.   Buy something that will help other people make money.   This is just six ideas off the top of my head.  The goal here is to create something lasting that will promote economic activity.  So a program that loans money forward.  Or a scholarship or free textbook, particularly in a STEM field.  A small piece of infrastructure that helps people move around to work or spend their money.  Solar is a bit of a stretch here, but it can be justified if you believe that an investment now is an investment in moving towards the future.   The key thing here is to make your money do double duty.  By spending your money during a recession or investing during the rest of the business cycle, you can get some value for your money.  But even better is if that spending has a societal return as well.  Microfinance, scholarships, and infrastructure do that.  There is the immediate spending, plus there is the effect of the spending.  A business is established.  A mind is trained and working at a high income job.  People can move, work, and spend their own money."
I do appreciate the explanation.  I was being a bit facetious about hotdogs in that I don't buy the SAME hotdog over and over again.    But seriously, I still don't see why rising house prices shouldn't count towards inflation.   100s of thousands of homes are bought per day affecting millions of consumers per day.  The price fluctuations in housing absolutely affect the spending habits of consumers in every other facet of the economy.  Or put another way, what if in some wacky world everyone stopped buying virtually all other items except bare essentials because they were all focused on buying homes.  A huge construction industry boom ensues. Millions are working building homes.  Home prices skyrocket 1000% and become like 80% of GDP.  Is inflation dead? Or has it just shifted to another asset under our typical inflation radar?  Living costs are still very much affected by housing in this scenario.  They're just affected by millions of separate people at once each day.   To say that because one person doesn't repeat buy housing too often, means policy regarding inflation should be ignorant of housing prices, just isn't right.  That they are bought and sold by millions of consumers each month is just as important to the economy as food, energy, or any other major facet of our economy. In any event, inflation might be lagging, but it sure as hell isn't lagging when it comes to housing. "As the OP expressed their thought it seemed to me they were suggesting anyones (or rather anyone who is ""Rich"" however *that* is defined*) non-invested money be taxed at this high rate and that strikes me as hopelessly naive. You don't think they would leave the country or ""invest it"" in a savings account earning .05% (or most likely spread across many so it was FDIC insured)?   &gt; I bet the rich would find something to do with that idle cash overnight if it was taxed at a 75% rate or so.    They were basically suggesting the US government sieze the savings of wealthy people.   The question of whether the highest effective tax rate **on income** should be raised is  a completely different discussion. Personally I favor a higher tax rate and some new tax brackets for the very highest earners. I don't really think it's necessarily *fair* in a progressive system to treat the rich as a ""piggy bank"" but it is what it is. They benefit the most so they are called to contribute the most.   I think I'd favor some kind of Alternative Minimum Tax for rich people so they had to pay a minimum of 30ish% of their income above some sort of cap (5 million per year? 100 million per year?) and capital gains  applied. This would close the Buffet loophole.   My biggest reason for this though is not because I don't think they *deserve* their money. It's because bottomless coffers basically guarantee that the legislation will be written for them and by them. There is always this tension between the poor and middle class that want more services and the upper class that wants to pay less taxes.   I am starting to get to the point where I think it might be better to have a smaller government (and less services) because they abuse their power (and our money) so much. ACTA, SOPA, NDAA, warrantless wiretaps, Afghanistan and Iraq wars, etc. I *do* like the idea of social safety nets but perhaps those should be more local.   Anyways, sorry for the wall of text." I take it the premise of the question is that we're assuming the person isn't worried about the morals. He's a criminal out for a quick buck. And I guess we're assuming that wherever you go, they wouldn't arrest you and extradite you back to the U.S. As others have noted, you can't just walk into a bank the day you graduate high school or get out of prison or whatever and get a credit line of $100,000. You have to build up to that with an income and a pattern of responsible behavior over a period of many years. I don't have the statistics handy but I'd guess most people never reach a credit limit on credit cards of $100,000. Maybe many people could get that on a home equity line of credit, but again, you'd have to build up that equity in your house first, and that would take many years. Then, while $100,000 sounds like a lot of money, how long could you really live on that? Even in a country with low cost of living, it's not like you could live in luxury for the rest of your life. If you can get that kind of credit limit, you probably are used to living on a healthy income. Sure, you could get a similar lifestyle for less in some other countries, but not for THAT much less. If you know a place where for $10,000 a year you can live a life that would cost $100,000 per year in the U.S., I'd like to know about it. Even living a relatively frugal life, I doubt the money would last more than 4 or 5 years. And then what are you going to do? If you come back to the U.S. you'd presumably be promptly arrested. You could get a job in your new country, but you could have done that without first stealing $100,000. Frankly, if you're the sort of person who can get a $100,000 credit limit, you probably can live a lot better in the U.S. by continuing to work and play by the rules than you could by stealing $100,000 and fleeing to Haiti or Eritrea. You might say, okay, $100,000 isn't really enough. What if I could get a $1 million credit limit? But if you have the income and credit rating to get a $1 million credit limit, you probably are making at least several hundred thousand per year, probably a million or more, and again, you're better off to continue to play by the rules. The only way that I see that a scam like this would really work is if you could get a credit limit way out of proportion to any income you could earn legitimately. Like somehow if you could convince the bank to give you a credit limit of $1 million even though you only make $15,000 a year. But that would be a scam in itself. That's why I think the only time you do hear of people trying something like this is when they USED to make a lot of money but have lost it. Like someone has a multi-million dollar business that goes broke, he now has nothing, so before the bank figures it out he maxes out all his credit and runs off. "When you give a gift to another person or receive a gift from another person there is no impact on your taxes. You do not have to report certain amounts in your income, including the following: ...   -most gifts and inheritances; http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/ncm-tx/rtrn/cmpltng/rprtng-ncm/nttxd-eng.html If you give a gift to a charity or similar organization you can reduce your taxes. It is my recollection that when a family member gives a large amount of money to a child, tax on the income that money earns (typically interest) should be paid by the giver, not the child, but I can't find any publications to that effect on the CRA Site. There is a bit of language about ""Gifts"" from an employer that are really employment income: Gifts and other voluntary payments 1.3 The term gift is not defined in the Act. In common law jurisdictions, the courts have said that a bona fide gift exists when:   •There is a voluntary transfer of property,   •A donor freely disposes of his or her property to a donee, and   •The donee confers no right, privilege, material benefit, or advantage on the donor or on a person designated by the donor. 1.4 Whether a transfer of property has been made voluntarily is a question of fact. In order for a transfer to be considered voluntary, there must be no obligation to make such a transfer. Amounts received as gifts, that is, voluntary transfers without consideration and which cannot be attributed to an income-earning source, are not subject to tax in the hands of the recipient. 1.5 However, sometimes individuals receive a voluntary payment or other valuable transfer or benefit by virtue of an office or employment from an employer, or from some other person. In such cases, the amount of the payment or the value of the transfer or benefit is generally included in employment income pursuant to subsection 5(1) or paragraph 6(1)(a). (See also Guide T4130, Employers’ Guide - Taxable Benefits and Allowances.) Similarly, voluntary payments (or other transfers or benefits) received by virtue of a profession or in the course of carrying on a business are taxable receipts. http://www.cra-arc.gc.ca/tx/tchncl/ncmtx/fls/s3/f9/s3-f9-c1-eng.html#N10244 If the people in question are adults who are not related to each other and don't have a business or employment relationship, then you should find that regardless of the amount of the gift, neither giver nor recipient will have a tax consequence." It is worth noting first that Real Estate is by no means passive income.  The amount of effort and cost involved (maintenance, legal, advertising, insurance, finding the properties, ect.) can be staggering and require a good amount of specialized knowledge to do well. The amount you would have to pay a management company to do the work for you especially with only a few properties can wipe out much of the income while you keep the risk. However, keshlam's answer still applies pretty well in this case but with a lot more variability.  One million dollars worth of property should get you there on average less if you do much of the work yourself.  However, real estate because it is so local and done in ~100k chunks is a lot more variable than passive stocks and bonds, for instance, as you can get really lucky or really unlucky with location, the local economy, natural disasters, tenants... Taking out loans to get you to the million worth of property faster but can add a lot more risk to the process.   Including the risk you wouldn't have any money on retirement.  Investing in Real Estate can be a faster way to retirement than some, but it is more risky than many and definitely not passive. The economy stinks because the government targets a straight line rate of NGDP growth that is ever diverging from the rate of sustainable economic growth which has been flattening since the 1970s when the cost of energy sustained significant rises in price and never looked back. The only way to make the economy not stink is to find a miraculously cheap energy source that is as cheap as fossil fuels were before the 1970s.  Since the possibility of this is practically zero, the best we can do is make the economy stink less in the long run by intentionally flattening the rate of NGDP growth by gradually pulling back on massive debt spending and tightening loose monetary policies. If we don't do this, we are just setting ourselves up for a future economic correction whose amplitude will not only be bigger than the Great Recession but will also be relatively bigger than the Great Depression. It doesn't matter.  The effect of that money being spent and entering into the economy as a whole is strongly positive.  This moralist argument is that unemployment is somehow tempting or enjoyable, but the only real support for that is the loathing associated with it.  Fighting with imaginary demons can hurt real people and economies. The monetary supply isn't a fixed number like in the old days of the [gold standard](https://en.wikipedia.org/wiki/Gold_standard) is part of the answer. Also, the actual spending of that one thousand dollars -- where the money is spent and on what -- does make a significant difference on how the overall economy is effected: People spending it on food, transportation and housing isn't going to drive up the costs of a Porshe 911.