How to Spend Lottery Winnings

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How to Spend Lottery Winnings. Against all odds it has actually happened: you have won the lottery. Your initial reaction is probably going to be to go out and buy everything that you have ever dreamed of. The best thing is to ignore this reaction and spend your winnings wisely instead.

Hire a financial adviser. Before you spend a dime of your lottery winnings, hire an adviser who can help you make wise financial decisions.

Make small purchases at first. Although a new car may be what you have dreamed of, wait to make your bigger purchases. This gives you time to shop around and also decide what type of vehicle falls in your price range.

Pay cash for everything that you buy. Never purchase a lot more than you can afford. Your winnings will dry up quickly and you may have to return merchandise.

Invest a portion of the winnings. If you don't want to be left with nothing, then invest a large part of the winnings in stocks and bonds. Ask your financial adviser for recommendations.

Buy at least one guilty pleasure item. Although you should spend your money wisely, you did win the lottery, so you deserve to buy at least one ridiculously expensive luxury item. It could be a piece of jewelry, a vacation or furniture item.

Pay off all of your debts. Get rid of your mortgage, car payment and credit card balance with your lottery winnings.

Tips & Warnings

  • Don't quit your job immediately after finding out that you won the lottery. Let it sink in and then work out the numbers to see if quitting is a financially plausible thing to do.
  • Don't overestimate the amount of money that you'll have to spend after winning the lottery. After taxes, the winning amount is going to be a lot lower.

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