Make a wise investment of your lottery winnings
Winning the lottery can be exciting, exhilarating and a host of many other feelings. The immediate feeling is to change your lifestyle and enjoy your life like never before. This can lead to many bad financial decisions being made. Buying a flashy car, a vacation home and even quitting your job are the common actions of lottery winners. Lotteries should try to advice winners on how to deal with a sudden windfall such as winning a lottery jackpot.
There are certain things to remember when you win the lottery. The first thing to do is to understand that there are many people who will want to share in the winnings. You should decide where you are getting your financial advice from. Not everyone is a financial adviser. Advice from friends and relatives can sound like it offers instant high rewards but what you need to remember is that the higher the risk the higher the rewards. Stories from lotteries have people investing in many speculative ventures and ending up broke.
One Massachusetts lottery winner has made two very good decisions after becoming a millionaire. He decided to take his lottery winnings as a lump sum. This ensured that he got a tax break and ended up paying less tax overall. Secondly he decided to invest most of his money in what most financial advisers refer to as a conservative portfolio. What this means is that he can make great returns on his investment and years later still have the principal amount intact.
Such portfolios ensure that you do not lose out on the principal amount you invest. This protects your money and when you are ready to withdraw your earnings you get the principal amount back intact. Most of the companies that invest your money will charge a minimal management fee that is usually a percentage of the money invested.
Stories of lottery winners wasting their earnings as soon as they have worn them are all over the Internet. That is why when a lottery winner makes a great investment, officials of different lotteries celebrate. Looking at a long term investment that can secure your future after you stop working is very important. Don’t get carried away with the here and now.
Think about how an investment can guarantee you a stress free retirement. It is not always clever to quit your job to live off of your lottery winnings. Unless of course your job gives you zero satisfaction and underpays you. Overall winning the lottery should make you happier not sadder.
Surround yourself with friends and family who want to see you prosper. So the next time you arepurchasing your lotto ticket and hoping to win the jackpot, think about how you would make the money count for longer.
Check out some Practical advices for lottery winners now.
Have You Read This?
August 19, 2012 | by Jonathan White |