Most people dream about what they’ll do with their money if they ever happen to win the lotto, but nobody ever thinks about what they SHOULD do. According to the Reader’s Digest, about 70% of lotto winners lose their money within 5 years or even less, in ways that could have been avoided. Life won’t be all sunshine and roses after winning big, there will be family members you’ve never even heard of before crawling out of the woodwork to ask for money, and people will try and exploit you, but if you keep your head straight you’ll be able to keep - and ultimately enjoy - all that money. Here are a few tips to help you spend responsibly, and live the best life ever.
Don't tell anyone
By going public you will open yourself up to financial firms constantly harassing you to take your business, scammers, and opportunistic family members. "What's the first thing that happens? All the friends and family feel like it's an open pool and the person who [won] feels an obligation to them. I would try to get my ducks in a row, wrap my head around it. If you don't tell anybody, it’s just you and your spouse who're dealing with it," says Colleen O'Brien, vice president of Charles Schwab. At the end of the day, it has nothing to do with anyone but you. You are the winner, it is nobody else's business and you have no obligation to tell anyone. People can become monsters when money is involved - one lotto winner lost his grandchild when he was kidnapped and killed over money.
Don't tell anyone until you are perfectly capable of dealing with the consequences, and have hired a lawyer and financial advisor. Handpick your own lawyer, accountant and investment advisor to create a team of people you will be sure will help and not use you.Do background checks to see if they are legitimate by checking broker records and seeing if any complaints have been filed against them. Remember, once word gets out that you won, charities, long-lost family members, investment firms etc. etc. will start beating down your door asking for handouts. But by changing your phone number and getting a post office box for your mail, it will be that much harder for them to find you.
Take it slow
Yes, you might always have dreamt about that Ferrari, but is it wise to blow all that money on it immediately after winning? First thing after you win, don't do anything. You need to let yourself get used to what happened and take the time to think about what happened and calm your excitement down to a level where you can think clearly. "In the first year, you're going to have to settle in with what this is and not make a lot of decisions about spending," says O'Brien.
"Make more decisions about taking care of your tax bill and planning for how you're going to retain this wealth over time."
Resist the urge to go on a spending spree, as this is a disaster waiting to happen. After winning so much money, you will feel like a kid in a candy store - with probably the same level of maturity. Also, don't immediately quit your job. You first need to do some financial planning, so quitting your job and retiring to an island is not an option just yet. Remember not to tell anyone at work, if word got out your boss may start looking for a replacement.
Be Responsible
There is nothing better you can do with your prize than paying off all your debt and living debt free. This is the most important thing you can do with your money. But after paying off all those annoying things such as your mortgage, there are a few more very important things to spend your money on, such as an emergency and retirement fund. Set up an emergency fund in case things go pear shaped in the future. Remember, just because you're a millionaire now doesn't mean you can't be broke again. Things happen, so make sure you are protected against that. Just like with an emergency fund, it would be wise to start a retirement fund to prevent having to go back to work after you turn 80.
Since you have been so fortunate as to win the lottery, share some of that fortune with those less fortunate. Who knows, by giving you might just get even more back.
If you haven't won the lottery yet don't give up, there’s still plenty of chances for this dream to come true. Your best bet of winning is to play lotto online on lottotime.com, as our site is safe, easy-to-use and fun. Go on, try your luck now.