Whether you’ve just won the lotto, inherited a large sum of money, got a promotion at work, or signed a contract with the NBA, sudden wealth can be a blessing and a burden. For those who did not grow up with money, the fame and fortune that comes with a large bank account can be a foreign concept. A good wealth management plan is essential to ensuring your money does not disappear as quickly as you acquired it.
While everyone experiences sudden wealth differently, some changes are common and universal to the experience. Knowing how money is going to impact the different facets of your life is essential to making sure you don’t find yourself worse off than before your windfall.
Suddenly waking up and finding your bank account having a few extra zeros in it can be stressful. While it’s easy to imagine finding euphoria at the thought of suddenly becoming wealthy enough to quit work and pursue more pleasurable alternatives, the reality is that the myriad of emotions that comes along with money can often leave an individual stressed out and overwhelmed. Insomnia, loss of appetite, headaches, and other physical symptoms of stress are not uncommon.
Because of the sudden burden of money, a lot of people experience personality amplifications. Greedy people become greedier. Generous people become more giving. For those that have always lived below their means and have given to charity, it’s not uncommon to start giving more than a smart amount of money.
It’s a good idea to always give yourself an adjustment period after coming into money. Put all major life decisions on hold for at least 6 months and continue with your normal routine. This will give you a chance to adjust to the idea of being wealthy and deciding what you want to do.
During that time, think about what you want to do with the rest of your life. If you’ve signed an NBA contract, the obvious answer is to compete at the highest level possible. If you’ve inherited money or won the lottery, the idea may be more ambiguous. Think about what brings you happiness and fulfillment, then conquer from there.
The people around you will change when you become wealthy. Unfortunately those that you may have thought were friends will become envious or jealous. Others may look at you as their personal bank and ask for loans or gifts. Helping people isn’t bad, but make sure your assistance will not be at your own financial ruin.
Remember that if you give money or assistance to a family member, the rest of your relatives might expect the same treatment. If they perceive you to be playing favorites, there may be conflict. A frank and honest discussion is usually the best form of wealth protection when it comes to dealing with family.
Long Term Planning
If you never thought about your financial future much in the past, that has to change. You should consult a wealth management specialist immediately and start taking steps to protect yourself. Wealth protection can include a financial plan, investing, setting up a will, and other measures.
With the right attitude, the support of your family, and a strong financial planner, sudden wealth doesn’t have to be a burden. Be realistic about your expectations, plan accordingly and enjoy the benefits of having access to money.