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a pile of bank notes; How I Would Split the Money if I won the LotterySource

Winning a lottery has some of the lowest odds in the world. The probability of winning a jackpot is 1 in 13,983,816. However, that does not stop people from purchasing lottery tickets. People are always looking for tips for how to win the lottery and make the big killing.

Now, what next when the tips work perfectly and you become the next millionaire? You first have to take care of the preliminary stages like understanding the tax implications and other local guidelines. Once that is sorted, here are some of the ways to use the winnings.

Invest prudently

Most people tend to think about investments before having the money. They wish to have some investments that would mean a secure future if the current cash flow runs dry. However, winning a lottery can be overwhelming such that you forget to prioritize investments.

For proper investment options, consider keeping the money away in safe short term investments. Take around six months as you collate and establish the exact amount available and how you intend to invest it. Once decided you can diversify your investments with multiple portfolios. For example, put some money in equities such as stocks and cryptocurrencies, while others in fixed income like bonds. A great place to start investing is SoFi which has multiple options for you to take a look at.

Avoid any investment that you don’t understand, and any other that sounds too good to be true.

An epic vacation

This is the time to get the world under your feet. You most probably have wanted to experience love while watching the Eiffel Towel, wondered what it feels like to be on a Safari in Africa and at the same how the sandy beaches in the Navagio come along. How about taking a tour of the famous Ibiza? Well, this is the time to take it all. If before the hotels and air tickets was an issue, it is time to enjoy the luxuries of the five-star hotels and the luxury travel.

The memories you get while travelling will stay with you forever and are worth the money you spend while at it.

Pay off debts

Most people are struggling with debts. Whether it is student loans, mortgages, credit card repayments, auto loans or personal loans, it all counts as loans that need repaying.

Now that you have won the lottery, there is no excuse to fail to clear the debts. Start with the loans with the highest interest rates before clearing the others. While it might seem inconvenient to spend the money on clearing debts, you will enjoy the freedom that comes with staying debt-free.

Start an emergency fund

When the money is too much, there is always this feeling of invisibility. You often tend to think it will flow forever and that nothing can mess it up. However, most people have gone broke before, even after winning millions from the lottery. It is appropriate to secure your future when the money is still available for unforeseen issues arising.

Consider keeping away six months worth of expenses in a high-yield savings account. These accounts have higher interests and are easy to access in case of emergency. Setting aside the fund comes with the needed peace of mind.

Put money in startups

Startups are another way that is ideal for spending your money. Instead of focusing on the traditional investments, look for companies that are starting and are willing to allow you some stake when you give them your money. When the company flourishes, you are assured of long term earnings.

There are various sites that list startups looking for funding. Look for one that has better chances of success. Take time to vet the company and the idea behind it, the founding team and its goals. Keep your investments in startups at not more than 5% of your earnings.

Make a social impact

Gaining too much is not all about you as an individual. While you might at the moment be free financially, several causes in the world still need your input. Consider donating to some of the causes you believe in like the local church, a library or an animal orphanage.

Other than the general public you can still spend the money with friends and family as you pay for their education, medical bills and other needs.

Save for retirement

Winning a lottery does not mean you won’t need some money when you retire. The only difference is that you can now retire earlier than you might have anticipated. For example, you can decide to retire immediately after you win the lottery. However, you still need to set aside some money for the future.

For example, if you win a lottery when you are 25 years old, you need the money to last for more than 50 years. In most cases, this would not be possible hence the need for retirement funds.

Bottom Line

Failing to plan for too much money can be disastrous. There are higher chances of blowing your money on unnecessary items and ending up broke than you were before winning the lottery. Use the above tips on the best way to spend your lottery money. Click here for more lifestyle guides when you win a lottery.

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I’m Stacey, in my mid-late 30’s, from a tiny village (officially a hamlet) in Lincolnshire.

I’m a mum to two handsome boys. They’re both diagnosed autistic but that only makes them different, not less. Barney, a Frenchie x Beagle, is my furbaby. Owner of a husband too!

Blogging about lifestyle and books with a bit of everything else thrown in!

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