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Would You Pick Guaranteed Money Now (Five Figures) or Take A Large Risk To Get Six Figures+?

DestinyArrives

DestinyArrives

Member
May 15, 2019
623
A friend of mine was talking about how he thinks it's stupid that people go for crazy amounts of money on game shows when there's clearly a chance to make a decent amount of change (like five figures). He added that if you're pretty much guaranteed five figures on a game show (let's say in the moment you could say yes and take home $50k as an example), you should just take it instead of risking it all. I told him that a lot of it is spectacle (game show needs to have your attention with crazy risks), but there's still a decent chance to win a large sum of cash.

Let me ask you, if you had a guarantee of making five figures in a game show, but could take a large risk to get an even larger amount, would you do it or no? Could also be like Brewster's Millions as well (highly recommend that movie if you've never seen it), except smaller denominations.

Edit: Example Being 50k Guaranteed vs 500k With Risk
 
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nsilvias

nsilvias

Member
Oct 25, 2017
23,802
take guaranteed and invest a good chunk of it and play the waiting game on my investment
 
dreams

dreams

Member
Oct 25, 2017
1,799
Guaranteed money now. I could do so much with it and still save a bunch.
 
Zips

Zips

Member
Oct 25, 2017
3,913
I would be very happy with the five figures in the here and now guaranteed. That would help me and my family out tremendously no matter what.
 
Nepenthe

Nepenthe

When the music hits, you feel no pain.
Administrator
Oct 25, 2017
20,721
Take the guaranteed money now. Money compounds on itself easily, so set yourself up now to make the 7 figures later.
 
VorpalNonsense

VorpalNonsense

Member
Oct 25, 2017
14,656
depends. we talking 10K or 90K? my answer changes depending on that number.
50K example? I'll take the 50K, sure.
10K? I'll gamble.
 
Servbot24

Servbot24

The Fallen
Oct 25, 2017
43,161
Depends on the specifics.

If I'm on Millionaire, I have 50k, the next question is to win 100k, I use the 50/50 lifeline, and have no idea which of the 2 choices is correct... I take the 50k

But if I have 10k and I'm going for 500k, I'm obviously gambling.
 
Yuli Ban

Yuli Ban

Member
Feb 1, 2021
391
I'd absolutely go with the five figures. Because regardless of if it's five or six or seven, I'd do the exact same thing with it: exactly what I'm doing now, but with less concern about my bank statement. Maybe I'd buy a couple more tech gadgets I have my eye on, but beyond that, I'm no high-roller.
 
Chairman Yang

Chairman Yang

Banned
Oct 25, 2017
2,587
What's the percentage chance and amount of the larger money? Depending on the specific expected value of each option I'd change my decision.
 
Aaronrules380

Aaronrules380

Avenger
Oct 25, 2017
22,481
Taking the guaranteed money is the smarter option. But Game shows are specifically picking contestants based on a number of criteria, and one of those is almost certainly that they want contestants who are risk takers. Because they make more money if they don't give a prize because a guy kept pushing his luck rather than taking a guaranteed amount. Obviously there will be a few occasions where the guy gets lucky and wins big, but those are designed to be rare enough that risk takers still end up saving the show money
 
RiOrius

RiOrius

Member
Oct 27, 2017
6,083
Depends a lot on the specifics. What do I think are my chances, and how much money we're talking about. With my current financial situation, five figures is too much money to spend on something fun but not enough money to retire on: it's just going to go into savings and not really impact my day-to-day life, y'know? But seven figures is enough to retire on and never have to go to work again.

Six isn't nearly as life-changing as seven, but (depending on where in the six-figure range it is) it could probably help me buy a house sooner, so yeah, that seems like it's worth the risk.
 
breakdancing duck

breakdancing duck

Member
Dec 16, 2017
2,002
Servbot24 said:
Depends on the specifics.

If I'm on Millionaire, I have 50k, the next question is to win 100k, I use the 50/50 lifeline, and have no idea which of the 2 choices is correct... I take the 50k

But if I have 10k and I'm going for 500k, I'm obviously gambling.
Click to expand...
Click to shrink...

Agreed. $10k is awesome, but I don't think my life would be any different. $50k on the other hand is more money than I could realistically save in a year.
 
FinFunnels

FinFunnels

Banned
Oct 27, 2017
5,610
Seattle
Game shows never seemed worth the effort to me.

There's so much screening you have to get through before you even get a shot of getting on the show.

Then your name, likeness and a little bit of background info gets broadcasted to millions of viewers. And then most contestants end up leaving with barely any prize money relative to the effort and insurmountable odds that it takes to get onto the show in the first place.

So to answer the question, I wouldn't even bother. It'd be wiser to take the less risky option, but that doesn't make for good television. And they probably try to weed out the non-risk takers during the screening process.
 
weemadarthur

weemadarthur

Community Resettler
Member
Oct 25, 2017
10,608
DestinyAwaits said:
I would say $50k guaranteed vs $500k major risk as an example (one we saw not long ago were similar numbers).
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Hmmm.
$50k is a goodish number, but for the 2021 tax year, it probably would screw me over to win that gambling and then not get me safe out of a hole. For me, it's probably worth it to roll the die for the $500k, which would screw me over but see me safe out of the hole too.
 
Pandaman

Pandaman

Banned
Oct 26, 2017
1,710
Servbot24 said:
Depends on the specifics.

If I'm on Millionaire, I have 50k, the next question is to win 100k, I use the 50/50 lifeline, and have no idea which of the 2 choices is correct... I take the 50k

But if I have 10k and I'm going for 500k, I'm obviously gambling.
Click to expand...
Click to shrink...
Don't you have to decide to walk before you see the question?
 
Ryuelli

Ryuelli

Member
Oct 26, 2017
15,209
Five Figures now. Throw half of it in a retirement fund, a quarter of it in ETH and BTC, and then use the rest as play money.
 

Deleted member 27938

Banned
Oct 30, 2017
943
easier said than done, I'm sure. when you're on stage with all the flashing lights, audience, and host convincing you to go for it, I'm sure it's sensory overload and your brain isn't thinking clearly. as for OP's question, depends on the situation I find myself in. are the chances of 6 figures good enough, what game am I playing, etc. 5 figures is not life changing, 6 figures could be.
 
Tavernade

Tavernade

Tavernade
Moderator
Sep 18, 2018
8,636
I imagine I'd take the five figures handily unless the risk was something skill based I thought I could pull off. Five figures is good but notlife changing, six figures is life changing. It's the difference between an extra year's take home salary or over half a decade's.
 
HiLife

HiLife

Avenger
Oct 25, 2017
39,687
Unless you're already well off, having a guaranteed money deposit seems like the best option rather than risking coming up empty handed.
 
WascallyWabbit

WascallyWabbit

Member
Oct 25, 2017
10,438
I def had this conversation many a time when my family watched Who wants to be a Millionaire
Kinda one of the genius parts of this show
 
mentok15

mentok15

Member
Dec 20, 2017
7,324
Australia
Depends on the probabilities. But unless they where decently in my favour I'd take the 5 figure now, I'm not a big gambler or greedy.
 
shaneo632

shaneo632

Weekend Planner
Member
Oct 29, 2017
29,021
Wrexham, Wales
Agreed. This has actually been studied psychologically though; the atmosphere of a game show where you're being egged on by the crowd and presenter makes it incredibly difficult to just cut your losses and cash out.

£50,000 is like 40% of a mortgage paid off where I live so that would be amazing.
 
LifeIsKillingMe

LifeIsKillingMe

Member
Mar 8, 2020
389
Washington State
Depend on the specific amount. If I can walk away with $12,000 or have a 50/50 chance to win $750,000, then I'm rolling the dice. If I have $90,000 and a 50/50 to win $200,000 then I'm gonna scoot with the loot.
 
Addie

Addie

One Winged Slayer
Member
Oct 25, 2017
8,726
DFW
You can derive the expected value of both based on the probability.

So, if the probability of winning 500k is greater than 10%, then I'll take it. If it's less than 10%, then I'll take the 50k.

Edit: Actually, Ryuelli brings up a fantastic point, which is that I'd need to calculate the compound interest factor for the 50k, which would mean I could reach a stated retirement goal. Sure, you could do that with the 500k too, and that would absolutely seal retirement...

I dunno.

I guess I'm still back to looking at sheer probability.
 
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