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Looking After Your Big Lottery Win
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Looking After Your Big Lottery Win

Winning a big lottery prize is a great achievement for sure. However, you need to learn how to look after your greatly increased bank balance. Taking advice is a great way to achieve that.

Faron Dougs is a certified financial planner, and he has seen the financial habits of  clients who are self-made millionaires. Now he’s passing on that knowledge and it’s information all lottery winners should read.

Get some advice

Getting advice is the best idea of all after a lottery win. You will be used to dealing with a certain amount of money, now you might have millions. “Your advisor should be both a partner and educator for you,” Daugs says.

Emergencies come along and some of his clients keep back funds that amount to six of nine times their monthly expenses. “This is one of the first steps someone should do in building a solid financial foundation,” says Daugs.

Avoid Debt

You may well have had a big lottery success but don’t go splashing the credit card or taking out loans to help build a business. If looking to purchase some new cars, then buy not lease them.  It is important, says Daugs, to have a solid reserve of money. Don’t just go out and spend, spend, spend your winnings.

Keeping up with ‘the Joneses’  isn’t a good idea. Daugs has seen how much money can be wasted on ‘upgrades’ and they “can cost you both money and lost opportunity.”

Investments

Investing some of your lottery win is a good idea. The financial advisor says that setting up automatic transfers to an investment account will ensure you don’t forget to do it. The investments can then used for future purchases or long-term goals. Again, this will act against possible debt.

Minimizing the amount of taxes that you pay is another good idea. There are plenty of ways to do this such as charitable donations, retirement plans and health savings accounts. Looking for ways to use your lottery winnings to make more money is advisable. Buying property for example is a good idea.

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