Original question:"How can someone handle large amount of money received from lottery?"
Send me the money and I'll show you... >B-)
There are some steps that seem to be more or less common for those that don't burn through their winnings in under a year:
Step 1. KEEP YOUR MOUTH SHUT. Don't tell anybody, don't brag, don't go on a conspicuous spending spree. If you use a financial advisor: Don't tell them the full amount that you have available. Drip feed it to them in hundreds of thousands. Although most are honest hardworking folk, everybody has their price. Best not to tempt fate.
Step 2. Take a short holiday and get out of your city. The charities are always tipped off and they will pester you incessantly if they think there is a chance they'll get anything out of you. Then they'll pester you some more.
Step 3. Get the money into your bank account.
Step 4. Do your own research and buy some stable income producing investments. (Shares in blue chip companies, ETFs, commercial real estate, etc.)
Step 5. Do nothing new or different for a full year while you get used to the money being there. (It's amazing how much more fun work becomes when impressing people no longer matters.)
Step 6. Replace your car if you need to, with a slightly better quality new vehicle. (People will notice if you turn up to work in a Bugatti Veyron so don't go nuts with it.)
Step 7. Buy the house you want to live in (Do not transfer your phone number).
Step 8. When money is invested well, it usually doubles every 7 to 10 years. If your investments are earning enough to do this while still providing enough income to keep you in a style to which you'd like to become accustomed, quit your job if you aren't having fun and find something fulfilling to keep you busy. This could be actively managing your money, it could be starting your own business or it could be volunteering. So long as it gives you a reason to get out of bed with a smile on your face everyday, it's a good thing.If you have less than six million dollars invested, this will be difficult.It is amazing how quickly the money can run out.
Find an investment professional who has a track record of handling portfolios of this size. Give him or her the ENTIRE amount you won, to be invested in a mixture of short and long term, low and high risk. Have them reinvest enough of the interest to grow the principal by the cost of living each year, so that it retains its value in real dollars. Then spend the rest.
That way you never eat into the principal, which you’ll be able to leave to your kids or any other beneficiary when you die, fully intact. You’ll never run out of money.
Consider setting up a foundation with some of the money, and spend the rest of your life giving away the interest from that to causes you think are worthy. Doesn’t THAT sound like a great life?
Example:Win $50 millionAnnual interest made at 8%: $4 millionPut $1 million back into the fund, leaving you with $3 millionSpend half of it (pretty nice lifestyle on $125,000 per month)Give away $1.5 million every year to worthy causes
Depends on the amount. I didn’t win the big Powerball jackpot - someone in MA did that. For small amounts, I’d just take the cash, pose for their pic and be done with it.
If I won, say 20 million or more:Go see my financial planner, accountant, and attorney. Maybe not in that order, but that’s the idea.I’d invest most to keep me in good standing until I’m 100 or 110.Set up a charitable arm that gives away x% annually to causes I specify.Move. I don't plan on living in Chicagoland anyway and winning the lottery gives me enough to walk away tomorrow.If this is big money, change my name - at least my first name.Stay low-key. Don’t drive high-end cars, nice ones, but not Ferraris or Lambos. A 3-series BMW is good enough. Don’t buy a palatial estate. That’s a maintenance headache.Donate enough to some organizations to sit on corporate boards as an independent director.Have another kid or two or three. Still young enough to want and enjoy them.
All that and grandchildren should keep me busy for the next few to several decades.
Change your online passwords right away. People will try to hack and spoof your accounts.
If you have a landline phone, get a new number and make sure it is unlisted.
Contact attorneys & financial planners who specialize in windfalls. Don’t sign or accept any winnings until you have gotten professional advice.
You absolutely should talk to a financial advisor.
A lot of lottery winners end up bankrupt, meaning they are worse off than before winning the lottery. They just have no idea what to do with the money. Most probably don't know how to handle money, period.
Talk to a financial advisor and you'll be set for life.
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