Have you ever dreamed of winning the lottery? Many of us daydream of what it would be like to become super rich virtually overnight, and it seems pretty exciting. But the all to common stories of woe to past lottery winners, or the rich and famous who are now no longer famous, lets us know that money does not solve all problems, it actually creates a slew of problems in and of itself. Financial advisors stress that it is imperative to have a plan.
Now those who come into a windfall are more than likely to receive it more commonly from an inheritance, insurance policy or the sell of a business instead of the lottery. So these individuals have some advance notice of what is going to happen. It is vital to put together a plan so that in 3 to 5 years one will not have blown all the money they have come into. It may seem, like you’d never run out with 500,000 in the bank, but it can and does happen to people without a plan.
The first tip for an individual who has just come into a large sum of money is to keep quiet about it, and don’t become overtaken in excitement.
The next thing to do is to determine what would be the best immediate use for the money. This would be the time to get rid of debts.
Now on the third step one would want to make a determination on how to make the money best work for them. One must remember if they keep spending and never replacing it would eventually run out, so therefore the money needs to keep growing.
You Need Help
If the amount of money is large, one will need to assemble a team of professionals such as a attorney, an accountant and financial adviser. People that can be trusted are a must, if you don’t have already established relationships with these individuals, then you will need to do research and rely on the recommendations of friends and family members to obtain assistance. This will be a key step in managing the windfall, and requires taking the time to get the right team.
Make Wise Decisions
If you were to win the lottery, how would you take your winnings, yearly payments or a lump sum? That decision will need to be made based on what one’s overall plans for the money is, tax implications, and other circumstances.
Coming in to a sudden windfall can be life changing, but there are some things in your life that you shouldn’t want to change. It is important to no let your core values, and lifelong relationships suffer because of money. Do your best to keep some sort of routine, and stability about yourself.