It’s one of those life-changing events we all dream of – all the things we could do if we won the lottery and struck it rich overnight! Traveling the world, buying those luxury items and status symbols, and of course, transforming the lives of our loved ones and family too. But what if it really does happen to you?
You’ve probably heard of people who’ve won big in a state or national lottery, or even the megamillions lotto draw – and somehow managed to let all their winnings disappear within just a few years, or even months. How could you really enjoy your winnings, but also make them work for you for the rest of your life? Here are a few of the do’s and don’ts if you ever come into a large sum of money!
Do – speak to a financial advisor and lawyer
Before you book that round the world cruise, one of the things you really must do is speak to an advisor and lawyer to make sure you’re covered for retirement and know how much you can actually afford to splurge before the fun begins. Remember that if you really want your money to work for you in the long run, having it invested wisely is a great way to ensure you and your loved ones are comfortable for the rest of your lives – and doesn’t that sound amazing?
Don’t – splurge on depreciating assets
While that gorgeous sports car or luxury speedboat certainly oozes appeal, they aren’t exactly great investments. If you want to spend money on some real status symbols, then rather invest in some stunning upmarket property that will actually become more valuable over time while you get to enjoy it!
Do – finally tick some items off your bucket list!
If you’ve being talking about those experiences you’d love to take part in if you only had the cash to get there, now is your chance. The glut of money, sadly, won’t last forever – and you really don’t want to end up regretting that you finally had the chance to do something amazing and didn’t take it.
Don’t – go public if you can avoid it
While it isn’t always possible depending on the regulations of the country or state where you live, staying anonymous if at all possible is a great idea. Some lottery lawyers (yes, that’s a real job) will even advise their clients to close down their social media accounts, or be prepared for every fair weather friend and vague acquaintance to suddenly come swarming out of the woodwork. Social media can really become your enemy, especially if there are pictures of you and your family publically available. Make sure they’re private, or close them down completely.
Do – some good
Money can’t buy happiness, but knowing you’ve improved the lives of others can. This is your chance to support a cause you really believe in, and if you set up an investment account or trust fund that will keep on doing good long after you’re gone, you’ve got the chance to leave one hell of a legacy! Any financial asset that creates a decent sum of monthly interest and can remain self-sustaining can accomplish this goal.
Don’t – make any rash decisions
Remember you don’t have to claim your winnings straight away, and your best plan of action is… to have a plan of action! Speak to a lawyer or accountant first, as it might be better to claim your winnings under the name of a trust or other entity for anonymity.
Another good reason to slow things down is that almost everyone changes their mind several times about what they want to do with the money before they actually make a decision! You will need to take time to get advice, weigh the pros and cons of all the different options, and decide how much you actually want your life to change. Moving to a country where you’ve always wanted to live may look great on paper, but actually uprooting your family and taking the kids out of school presents a different reality when it’s actually an option. For example, and quite surprisingly, a lot of people actually decide against quitting their jobs!
Do – pay off all your debts
No matter how big or small the payout you receive, getting out of any existing debts first should be your number one priority. It’s the first step towards financial freedom, whether you win the lotto or not.