Winning the lottery is likely to build up your excitement, make your adrenaline pump, and make your heart race fast. You also undergo a few seconds of disbelief. What matters, however, is what you do after you come out of that moment of skepticism. Once you come into terms with the fact that you have hit the jackpot, the decisions you make will change your life forever.
According to studies, many jackpot winners end up broke and miserable for the failure of playing their cards right. Avoid sailing in the same boat from rags-to riches-to-rags again. Use these tips on how to do with your money if you win the lottery.
Take Time to Process
It’s normal to want to get your hands on the money and start using it right away. Getting such huge money on your account all at once is likely to make you overwhelmed that you end up making poor decisions. Take time to relax and let your brain process that you’ve now joined the 1% population of top income earners.
Since you may not have the experience to handle such much money, consider talking to a trustworthy financial planner. Such an expert takes you through different issues related to winning the lottery jackpot, including:
- Benefits of taking the money in a lump sum over annual payment every year
- Tax issues associated with winning the lottery
- Smart money management tips for your new-found wealth
You can ask your friends or family to refer to an excellent financial planner. Make sure you check online reviews about the planner before making your decision.
People tend to befriend others if they think or know that you are financially stable. After following the tips on how to win the lotto and getting success, you automatically join the rich few, and that makes you a target for fake friends. Those you know and others you barely recognize will start sending you handouts and requesting you to start business partnerships.
There’s also another group of close friends and family who’ll expect you to give them loans and expensive gifts since you’re now a millionaire. The worst thing that can happen to you for going public about your winnings is attracting scammers and thieves who can track you down and make your luck theirs. You can avoid all that by maintaining anonymity and having full control of any financial decision you make.
Cut Your Coat Accordingly
Once you get more money in your bank account than you ever dreamt of, you’re supposed to take your time and think of ways to invest it. It’s easy to get tempted to spend your money all at once, especially if you’re afraid of losing your money to scammers and bad financial decisions. Don’t let such negative thoughts overwhelm you. Instead, follow money management tips provided by your financial planner, and you will be safe from thieves and money pests.
Protect your money further by sticking to a workable financial plan and your regular household budget. Make smart investment decisions and have your financial advisor design a sound long-term business plan to keep you wealthy today and many decades to come.
Get Insurance Coverage
In case the news that you won the lottery gets out to the public, you could find yourself a target of criminal organizations and individuals. These will come with baseless claims and haunt you with endless lawsuits with the sole purpose of getting a share of your new-found wealth. Protect yourself and your money from such people by hiring an insurance specialist and an attorney on a retainer basis.
Don’t be surprised if you disgruntled ex-spouse finds reasons to take you to court after you win the lotto jackpot. You also attract other money predators who want to get a share of your winnings. So it should come as a surprise if someone gets hit by your car intentionally to sue you. With a lawyer by your side, it’ll be easy to protect your wealth. You can also create roadblocks for creditors to reach your money in the form of limited liability companies, limited family partnerships, and trusts.
Hang Onto Your Job
Maybe you have a dream of winning the lottery and enjoy that moment when you tell your boss to take his job and shove. But no matter how much you loathe your 9 to 5 job, stick for a little while even after winning the lotto jackpot. At least wait until the check clears. Quitting your job unceremoniously might come hard on you, especially if you’re not declared the winner officially.
Pay Off Your Debts
There’s no better way to start an investment with your lottery jackpot than with a slate clan of debts. Once your check clears, make sure you pay off mortgage, credit card debt, and any loan you may owe financial institutions. Paying off your debts first helps since you don’t know whether the percentage you decide to invest will shrink or grow.
Can You Play Lotto as a Financial Investment Plan?
After winning the lotto jackpot, it’s a good idea to invest some of the money for a regular income in the future. However, playing the lottery as your financial investment plan is a bad idea since it’s not even a strategy to start with. If you have to continue doing it even after you win the jackpot, do it for fun and nothing else.
As for investment, consider taking the old-fashion way of traditional investment. It may take a lot of time and requires you to be highly disciplined. Making sound investment may sound tedious and time consuming than playing the lottery, but in the long-run, it pays way better than the latter.
Act Smart after Winning the Lottery
To enjoy your lottery winning for long, take time to let it sink, don’t go around announcing to everyone that you’re the newest millionaire in town. Then follow the tips above to the letter. By doing that, your lottery winnings will be around for longer for your and loved ones to have a good life.