When confronted with the reality that you just won a bunch of money, it’s easy to get caught up in all the things you want to buy. However, if you want to make good financial decisions, here are some smart ways to spend your lottery winnings.
Are you an expert in the financial or legal field? If not, you’ll need to hire both after you win the lottery. An article written for trustandwill.com elaborates by saying, “One of the best investments you can make at this time is to add legal and financial professionals to your team. A certified financial planner can help you come up with the most effective plan for using your lottery winnings. They can inform you of certain tax thresholds, and help you decide if it’s best to take the lump sum or annuity payments. They’re also going to give you advice on how to create an enjoyable lifestyle while still investing in your future. It’s also a good idea to have an attorney on your team in case anyone tries to file a suit or make claims against you.”
Pay Off Debt
If you’re not planning to use your winnings to get yourself completely out of debt, rethink your plan. There’s no reason why you shouldn’t use your windfall to set yourself up for continued financial success. Unburdening yourself from debt feels incredible. Make it a priority!
You would not believe how many people win the lottery and end up filing for bankruptcy a few years later. You’re much smarter than that! You would never squander away millions of dollars without putting any thought into setting up an emergency fund. If you’ve won the lottery, you know as well as anyone that life can be unpredictable. It’s full of unexpected phenomenon- some good, some bad. When you’re in the midst of the good times, it’s still important to prepare for the bad. Create an emergency fund for yourself that will give you some breathing room should you ever run out of money.
What good is winning the lottery if you’re not going to use a portion of it to fund your retirement? You don’t want to work forever. Allocating some of your winnings to ensure you’re comfortable when you retire is a very smart way to spend your money.
Donate to a Cause
If you’ve done all of the above mentioned suggestions and still have some money to spend, consider donating a sum to a cause that is near and dear to your heart. When you look back on how you spent your money, you probably won’t remember every purchase you made, but you will definitely remember where you’ve donated. Be generous! A life changing amount of money for an organization is probably nothing compared to your lottery winnings.
Winning the lottery is an amazing thing! However, putting that money to good use is even better. Be smart and stay successful.