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Tips for handling a windfall

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How to win at winning the lottery

The odds of winning the Mega Millions jackpot, which is now $940 million, is 1 in more than 300 million. While very few will experience that kind of windfall in their lifetime, the lottery isn’t the only chance to come into sudden wealth.

Whether it’s an inheritance, sale of a property, bonus or even a tax refund, there are other ways to receive an unexpected sum in a lifetime.

“It’s common enough,” said Daniel Scott Johnson, an investment advisor and founder of Windfall Advisors in Los Angeles.

In every case, there are certain steps you can take to make the most of it.

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“Money can be a taboo subject in a lot of families, which means it rarely gets discussed,” said Ajaie Albert, communications director of Lotto N Crowd, an online lottery service. As a result, many people don’t “have a firm understanding of how money can work for you.”

“Throw in any unexpected large sum of money, whether it be from a lotto winning, inheritance or significant bonus at work, and we’ll typically see a few individuals end up worse than where they started,” he added.

To avoid the all-too-familiar pitfalls, start by building an experienced team, including an accountant, financial advisor and an attorney to protect the money and your best interests.

Then, “do nothing,” Johnson at Windfall Advisors said. “I wouldn’t recommend making any major purchases or changes to their lifestyle until they come up with a financial plan.”

If you don’t already have an investment account, park the funds in a high-yield savings account or money market account, Johnson advised.

“Money markets are a fantastic spot to be in a bear market and they pay a nice rate given all the risk in the market right now.”

Protect, preserve and grow funds — with minimal risk



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