While the first Irish winner of the EuroDreams jackpot of €20,000 a month for the next 30 years will no doubt be celebrating wildly today, the nature of the prize means they will have to approach their good fortune with considerably more care than a traditional jackpot win might demand.
The winnings amount to €7.2 million – by any measure an enormous and life-changing sum – but when it comes to things such as buying a new house or car, or even going on some very swanky holidays, a level of credit will definitely be required.
First to the house
The guaranteed monthly income of €20,000 would allow the winner to buy a new house – or their first house, depending on their circumstances.
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But they will still have to take out a loan and adhere to Central Bank lending rules. They might also find themselves having some difficult conversations with mortgage lenders who have never had to deal with a situation such as this before.
Ever.
With guaranteed income at this level, a person should be able to buy a house costing about €2 million. Such a figure would leave them with monthly repayments of an eye-watering €10,000 a month for the next 25 years.
And what might you get for €2 million?
We had a look on MyHome.ie and there are 113 properties in the Dublin area right now that match that budget. While they are all impressive, there are no real mansions on the market at that price.
Actually we tell a lie. There is one house – on Henrietta Street in Dublin – that qualifies for mansion status. It has 10 bedrooms, multiple reception rooms including servant’s quarters and all the rest.
We haven’t been inside but would imagine it would take a few bob to do it up on top of the €1.75 million asking price. So it might be beyond the EuroDreams winner.
Maybe somewhere else?
Outside of Dublin there are some pretty magnificent properties for sale. For example, the sprawling Bramble Lodge in Crosshaven, Co Cork, selling for €1.75 million, or Fir Elise in Co Wicklow at €2 million, both definitely worth a look.
If the winner wants to upgrade their car – or cars – they should be able to lease two high-end motors for about €3,500 a month. Is it money well spent? Only the winner can answer that.
Then there is everyday living expenses
The bigger house will cost more to heat and light, which will see energy bills climb to about €500 a month, while upgrading a family’s private health insurance plan to a gold-plated policy will probably cost a further €1,500 monthly.
If a typical family spends €200 a week on groceries and we allow our winners some extra spending – and maybe buying the odd egg in Avoca – they might see their spending climb to €350, adding a further €600 to their monthly outgoings.
Holidays are another area where the winners might want to splash out – particularly if they give up work and have a lot more free time to fill.
Holidays are not cheap, however, and if we allow our family an annual budget of €15,000 – to cover ski trips, city breaks, sun holidays and maybe even the odd night away in an Irish hotel – it will add a further €1,250 to their monthly spending.
We totted up all these expenses – in the knowledge they are far beyond most of us – and they came in at €17,350.
And the day to day?
That leaves €2,650 a month to cover everything from school fees and grinds to medical expenses, social lives, clothes, grooming, mobile phones and broadband.
We have carried out multiple household price checks over many years and at a basic level the annual cost of all the elements of day-to-day living, not included above, will come in, for a family of four, at a conservative €1,125 a month.
That will leave our winners with about €1,500 a month left over, a sum they might do well to squirrel away.
Because while it might seem like their good fortune is never ending – and while they are undoubtedly much, much more fortunate today than they were yesterday and better off than the vast majority of the population will ever be – this particular money well is not endless and could dry up pretty quickly if the wrong decisions are made.
