Guidelines for "Lottery" Winners

Have you ever won the Lottery, sold your business, won the Big Jackpot, or received an unexpected inheritance? These situations have one thing in common for most people - they are unprepared for the windfall. They don't know what to do with the money.

Many times, their first impulse is to begin sharing it with friends and family members. They've never been so popular. Everybody knows their name. They are praised for every gift they make, for every car they buy and every debt they pay off. A new home for mom, exotic vacations with 17 of their best friends in Tahiti. You da Man!

Nothing wrong with doing those things. But, what trips up most "winners" is their timing - its "when" they do it that's the problem. Choosing the wrong "when" is what gets them into trouble.

The rich become richer because they avoid spending their capital. They seek to preserve their capital, to leverage their capital, to increase their capital. When they want to buy "stuff", they use some of the money their capital has produced - not the capital itself. The result is ever-increasing wealth.

So, don't buy mom a car with your winnings. Buy her a car a few months later using a bit of the interest money your winnings generated at the bank. That way you could buy her a car every month for the rest of her life, if you wanted to. Get the picture?

If you don't know how to handle it, put the money into the bank so it can at least generate some interest while you're finding the right advisers and mentors. Do not be in a hurry. You have one chance to get this right. Take your time.

Don't kill your golden goose by spending it. With the right planning and advice, you can succeed where others have failed miserably.

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