Even Lotto winners need to budget
No matter the size of the win, lotto winners who wish to keep their money, need to budget.
There are more lotto winners who have lost it all than those that have kept it. I am not talking about the smaller winners but the ones who win big.
There is obviously an urge to spend the money to improve your lifestyle.
This is not a bad thing but it needs to be done cautiously and with the help of financial advisors. http://kasheringyourlife.co.za/10-things-about-budgets-and-debt/
I read in an article titled ‘What to do if you win the Lotto’, “Becoming instantly rich or even receiving just a healthy boost of cash, can bring many more problems than it solves,” warns Citadel Advisory partner Anelisa Mti.
“People often focus more on short-term objectives when they receive a sudden lump sum of money, as opposed to having built it up over time,” said Mti.
When doing research for this article, I found more cases of lotto winners going broke than those who kept it or grew it. This was a worldwide phenomenon and the winning amounts all varied.
Here’s how the South African lotto winners get paid out.
When you win more than R 50 000 you will need to go to the Lotto offices with proof of ID and a proof of an existing bank account.
The South African lottery money is paid in one lump sum, as opposed to the US and other lotteries where you can choose either an annuity or a lump sum.
In South Africa, you are offered financial counselling and advice which is voluntary. From what I could find, was that even people who went to the advisors and counsellors landed up losing everything.
The reason appears to be that while they were given sound advice, the winners often chose to ignore the advice.
Have you ever thought about what you would do if you won 1 million rands, never mind 20 million rands?
It seems that financial difficulties come whether you have money or don’t. How you deal with money is the difference. https://www.news24.com/SouthAfrica/News/local-lotto-winner-loses-all-his-millions-and-he-wont-die-until-he-gets-it-back-20190315
There are people who have very little but manage to live on what they do have and then I have met people who should not be struggling but are.
It’s all about the attitude as well as the discipline you apply to your money.
Does your money manage you or do you manage your money?