Most of us dream about winning the lottery jackpot. The temptation to buy a ticket and be in with a chance of winning is too great to ignore. Especially when you’re talking about millions of pounds up for grabs!
The UK’s National Lottery has made scores of people overnight millionaires. Apart from the obvious, one of the benefits to winning the jackpot is that your winnings are tax-free. Across the pond in the US, you don’t get to keep all your winnings due to lottery taxes.
If you have just discovered that you’ve won the jackpot, you are doubtless still in shock. You might even be wondering if you are in a dream. But, it’s not a dream. It’s true; you did win several million pounds!
Once you have got over the initial shock of winning the lottery jackpot, your attention will soon turn to what to do with the money. And who you should tell about your good fortune. Today’s article offers practical suggestions on what you could do with your lottery winnings.
Should you tell anyone that you’re a millionaire?
Camelot are the people that run the National Lottery. One of the things that they will ask you is whether you wish to go public with your news or whether you wish to remain an anonymous winner.
You might get tempted to share your good fortune with the world, but I think this is a bad idea. Research has shown that lottery winners who go public get “requests” from people that want to take your money off you.
Some of those people are strangers. Whereas others are people you know that are now your new best friends… The decision is, of course, up to you. But I do not recommend going public with your news.
Pay off your debts
After celebrating your good fortune with close family members and friends, what should you do next? The first thing you should do is pay off all your debts. Everyone has differing amounts of debt. What I’m talking about are debts like credit cards, loans, mortgages and car finance.
The only monthly expenses you should have left over are utility bills and mobile phone contracts. It’s a great feeling paying off debt, as it will remove a huge burden from your life.
To quit or not to quit?
It might surprise you to learn that many jackpot winners keep their day jobs even though they’re rich! For instance, a man named Ron Elliot from Surrey won £8 million.
He decided to keep his £15k a year day job working for a care home with dementia patients because he finds he work rewarding. But if you have a rubbish job that you hate, the last thing you might want to do is keep working there!
If you do decide to quit your job, you should think about taking up a hobby that ensures you stay productive with your time. The trouble with winning the lottery and not having a job is it’s all too easy to lose your sense of purpose.
We all need something to do with our time. Otherwise, we start to feel bored and depressed.
Photo Credit: phoenixshade (Flickr)
How generous should you be with your money?
Many lottery winners give away some of their winnings to close family and friends. On the one hand, it shows that you are a kind and generous person. But on the other, some of those close to you might try to take advantage of that fact.
Before you give any of your money away, you need to have a long hard think about why you want to do so for certain people. You might want to give some money to your parents, buy them a nice house and maybe even treat them to a well-deserved luxury holiday.
But you might not want to be so generous with other family members or friends that haven’t always been nice or supportive to you in the past. It’s a judgement call that you will have to make, so be careful before you decide what to do.
Your home, cars and even clothing will be somewhat modest. At this point, you are doubtless thinking about moving somewhere more upmarket. Given that you don’t have an unlimited source of money, I suggest not going mad with your spending!
Buy a nice house or villa in a nicer part of the country, or even in another country if you wish to emigrate. Check out the selection of luxury Range Rovers from Junction 17 Cars. Go on a luxury holiday around the world if you wish!
Just bear in mind that you need to keep tabs on your money. If you’re not wise with your spending, you could end up losing it all like a few unfortunate lottery winners have in the past!
Set yourself an income
Once you’ve treated yourself, there now comes the time where you have to apply a disciplined outlook on your money. You will need a certain amount of cash each month to pay your monthly bills.
At this point, you should set yourself an amount of money each month to get used on your regular expenses. Depending on how much you’ve won, this might be a few years or a few decades’ worth of income.
Invest in the future
Few people have the opportunity to invest large sums of cash. But what should you invest your money in? Here are some ideas to help you out:
- Use some money to put into a “New ISA.” Ensure the NISA provider offers a high interest rate for your savings. Remember that NISAs are tax-free;
- Nothing beats bricks and mortar for investment. Devise a strategy to build up a property portfolio that offers a high yield from rental income. You could also “flip” properties. In other words, buy cheap properties, renovate them and sell them on for a profit;
- When you retire, you will need an income. Choose a decent financial adviser to help you set up a low to medium-risk pension pot for your future;
- Technology companies are good places to invest some of your money in. Ensure you have a diverse share portfolio, so that any major losses won’t be catastrophic.
Featured Image credit: frankensteinnn (Flickr)