For all its promise, instant riches come with a price
THE NEW HAMPSHIRE LOTTERY WINNER IS STILL ANONYMOUS AND WE THINK THAT'S A GOOD THING
After the recent lottery win in New Hampshire, there is a buzz of speculation on why the winner hasn't yet come forward to accept his or her winnings. Among the speculation, the most likely scenario is that the winners are trying to find the best way to handle this new reality without exposing themselves to the many negatives that come with winning the lottery.
FOR ALL ITS PROMISE, INSTANT RICHES COME WITH A PRICE
This starts with the immediate barrage of calls from relatives and distant friends who are eager to share in the fortune. Never mind the need to hire specialists to help you navigate the financial, legal and tax complexities that this amount of money brings.
Many people, caught up in the excitement of all of it or with the fear that everyone is out to take something, make the decision to try to take care of everything on their own. Unfortunately, this can leave people vulnerable to unforeseen tax implications, lack of expertise in best investing practices, being taken advantage of by friends and loved ones and making spending choices that aren't necessarily in their best interest.
According to Susan Bradley, founder of the Sudden Money Institute, "Some people are really afraid – scared of blowing it, losing who they are and being taken advantage of. Hopefully they (those who do not come forward) are getting their ducks in a row and starting to settle into the magnitude of the experience."
WINNING THE LOTTERY IS A MAJOR FINANCIAL LIFE TRANSITION
Financial management is complicated enough. When you undergo a financial life transition, such as a lottery win, the complexities grow.
There have been too many stories on the fate of past lottery winners who've spectacularly burned through vast fortunes or found that they were better off before they struck it rich. In these cases, rational long-term thinking was replaced with confusion, emotional turbulence, and inconsistent behavior which led to regrettable financial decisions.
In an experience as life altering as winning the lottery, it is important to develop a strategy that will help you and your family establish order, regain balance, consider options and opportunities, plan and move forward and refine and rethink your goals and aspirations.
Successfully managing a financial life transition is more challenging than many people realize and it's important to get the right help. Guided by our Certified Financial Transitionist® designation, Northstar is uniquely qualified to help you successfully navigate the personal and financial complexities surrounding a financial windfall.