Posted over 2 years ago The 6 Best Uses of $1 Million as a Real Estate Investor Each week, we post a new question to the Best Ever Show Community on Facebook. The Best Ever Show Community is a place where real estate entrepreneurs of all stripes and sizes can come together to interact with each other, me, and the guests featured on my podcast with the purpose of everyone helping each other reach the next level in their businesses and their lives.What better way to add value than to ask you, the community, for your Best Ever advice on a variety of different real estate topics. This week, the question was “you’ve just been given $1,000,000. What’s the first thing you do?”Thank you to everyone who responded. While most of us won’t be handed $1 million any time soon, I do believe this is a good thought experiment. How we answer this question can shine a light on our top priorities or help us clarify our real estate goals.That being said, the poll is closed, the responses are in and here are the answers:1 – InvestThe most common response was to invest the $1 million into some sort of real estate product. Some answers were general, like finding another deal that adheres to a current investment strategy (Craig Hyson), upgrading from single-family or smaller multifamily investing to apartments (Barri Griffins, Mark Alexander Davidson) or investing in real estate to live off the interest (Andrew LeBaron).Others had more specific action plans. Justin Shepherd would grow the $1 million to $10 million by investing in a deal with 30% cash-on-cash return, and then rinse and repeat. Justin Kling would use the $1 million for a 25% down payment on a $4 million apartment complex at $50,000 per door. The 80-unit ($4 million / $50,000 per unit) would ideally cash flow $200 per door, which is $16,000 per month or $192,000 per year. That’s enough cash flow to live off of if you ask me. Iqbal Mutabanna would take half and reinvest in his real estate business by purchasing an asset that produces a 10% cash-on-cash returnSpencer Leech’s strategy would result in the largest investment. Hewould find a cash flowing C-class apartment community in a secondary market that is stabilized or required light rehabs. At 75% LTV with 20% of the down payment being private equity and 5% being his $1 million, he’d acquired $20,000,000 in apartment assets. Two other active investors would also invest, but in a non-real estate related product. Deren Huang would lock into a 1-year CD. Glen Sutherland would go to a lender to secure a larger loan to invest with. And Eric Kotter would invest in other real estate investors by offering private lending and transactional funding.2 – Pay Off Debt ObligationsAnother popular use of $1 million is paying off existing debt obligations. Craig Hyson and Deren Huang would pay off the mortgages on their current investment portfolio, which would drastically increase their cash flow and leveraging abilities. Eric Kotter and Amy Wan would pay off their personal debts. Eric would eliminate all personal debt, while Amy would pay off her and her husband’s student debt. By paying off their personal debt, they can redirect those monthly debt payments into real estate investments.3 – SaveOne of the less aggressive approaches is to save the $1 million. Eric Kotter would set aside a portion of the $1 million for taxes, and Iqbal Mutabanna (who used $500,000 to invest with) would add $200,000 to a rainy-day fund.4 – Gratitude and ContributionThe most altruistic first step after receiving $1 million is to express gratitude or donate a portion of the proceeds. Since someone just gave you $1 million, it only makes sense to pass that on, right?The first thing Jason Scott Steinhorn and Dave Slaughter would do is say thank you to whoever gave them the money. In terms of contribution, Andrew LeBaron would pay tithing, Justin Kling would give away 10%, and Iqbal Mutabanna would use his remaining funds for tithing ($100,000) and donating to charities ($200,000).5 – StrategizeA very rational first step after acquiring $1 million is to take some time to strategize and come up with the most effective use of the money. Neil Henderson would make an appointment with his accountant to discuss tax strategies. Nick Fleming would hire a world-class mentor/business coach and start hiring really talented employees, both of which will 10x his business. Charlie Kao would refocus by creating new goals and a new business plan, working towards growing his money long-term. And Deren Huang would make sure he remained level headed and didn’t make any impulsive decisions, because he doesn’t want to live out the reality of many lotto-winners who end up bankrupt after a couple of years. 6 – Minor Adjustments to Business or LifeTwo investors wouldn’t make a massive change. Tyler Weaver would hit up the gym, get a good night’s sleep and have a reasonable breakfast, because he needs a solid state of mind to take good care of his money. Devin Elder wouldn’t make any fundamental changes either. He would just put the money in the operational account of his house flipping business. The only changes he would consider making is to discontinue using private money lenders on a few deals or expedite a few fix-and-flip projects with the extra capital.I think all 6 of these strategies are great uses of $1,000,000, but what do you think? Comment below: If someone gave you $1 million, what is the first thing you would do?