5 Tips for Maximising Sudden Wealth
Sudden wealth can have such a surprising influence on the people it affects that there’s even a psychological term for it: Sudden Wealth Syndrome. Many people – especially if they’ve not had the experience of managing a large amount of money well in the past – may find sudden wealth overwhelming and require the services of financial advisory organisations such as My Wealth Solutions. Here are the top five tips to avoid losing money as fast as you got it.
Just Say No
Shopping till you drop is tempting – but beware the urge to spend everything you have. Consider the implications of your windfall. Are there taxes to pay? Do you have any debts that could be taken care of first? Consider your future; do you have children? Another element to take into account is that if your sudden wealth is the result of an inheritance, there will be legal costs, even if there is no contest to the will.
Take Time to Decide
Try to avoid rushing into any decisions and take time to make decisions. You can cement your judgements by consulting with professional financial and legal experts. Even then, make yourself wait before you decide on anything impulsively, like jetting off on a trip around the world. If your windfall has come about as the result of a loved one’s death, the impact on you emotionally may be severe and emotional decisions rarely turn out to be good ones.
Keep Your News Close
Only tell those people you really trust about your new financial situation. Ask them not to discuss it. This is for your own personal safety as well as that of your family and friends. In addition, too much knowledge about your circumstances could make you the target of scam artists and hackers, not to mention all manner of bad advice and unsolicited requests for freebies.
Avoid Making Too Many Promises
While you may want to help friends and family who need a leg up, avoid offering anything to anyone til you have a clearer handle on where you’re at and how you feel about things, and where you want to go. You need to carefully consider what you might want for your own family today and into the future. There’s no need to offer to pay everyone’s school fees into the next generation, and it isn’t a good idea to promise pieces of your wealth to everyone who asks.
While all the above warnings are good advice, you still need to stay true to who you are. It isn’t a good idea to retreat from life and suspect everyone of wanting a piece of your money either. This can leave your life worse off than before you had your windfall. Remember to get out and about with your nearest and dearest just like you did before – it’ll help to keep your perspective in check.
Research has been done into lottery winners, game show contestants, and Olympic athletes who win a gold medal and suddenly find themselves with more sponsorship deals than they know what to do with. While wealth is generally acknowledged to be a good thing, sudden wealth certainly comes with its share of headaches.
What would your top tip be for someone who has suddenly come into a large amount of money? Share your wisdom below.