NEWS

lottery cash or annuity

lottery cash or annuity

my name is Kevin Burke I’m a certified
financial planner professional and
author of the book make your money last
a lifetime
so what is good investment advice for a
lottery winner well for a lottery winner
I’m going to say that the very first
thing you should do is exactly nothing
if I were to advise you I would say for
one year don’t do anything with your
money don’t think about it don’t use it
don’t quit your job don’t buy stuff
don’t give stuff away don’t loan it
don’t do anything with it one of the
wealthiest men I ever met one day said
to me said Kevin people hate money and I
thought he was crazy because of course
people don’t hate money but he said the
reason you can tell the people hate
money is because as soon as they get
some of it they give it away they trade
it for TVs and cars and houses and trips
and so forth and his point was that
people obviously like money it’s just
that it’s hard sometimes to sit on cash
in the bank it’s hard not to go out and
do we feel like we have to do something
with it so I would like you to see you
as a lottery winner do nothing for a
period of time and if you can hold out
for a year that would be great and if
somebody asks you for a loan which is
going to happen then you simply tell
them no I have set my money aside I
can’t get to it for a year we’ve all
heard the statistics that so many
lottery winners are bankrupt within
three to five years what we want you to
do things that are different than those
people we want you to hold on to your
money so give yourself a cooling-off
period and allow that money to sit so
once you start to decide how to invest
your money you’re still working you
haven’t bought a new car you haven’t
taken around the world trip you’ve let
that money sit then you might think from
that point on how to invest it and
here’s a real simple formula and
everybody situation is different so I
certainly can’t give you personalized
advice but I would like to see you take
two years worth of income and put that
in something very safe and very liquid
and that might just mean a savings
account
the bank where it’s insured and that way
no matter what happened to your other
investments you know that you can live
this long without worrying too much
about it I would like you to then take
three to five years worth of income and
put that in something that’s also
conservative maybe not quite just
sitting in the bank maybe it’s in
capital markets and say bonds something
like that but somewhere where it’s
secure and you don’t have to worry about
it too much it doesn’t fluctuate in
value a whole lot and that will allow
you to get by for three to five years if
necessary and finally all of the rest of
it that money you can invest in a way
that it is set up to keep up with
inflation and taxes because inflation is
what’s going to eat your money away so
this is a real simple method on how to
invest money’s particular if you’re
retiring and if you have enough money at
that point you want to quit your job and
you want to buy the kids a house you
want to pay off your house things like
that well by all means go ahead and do
that but this money will be set aside
for inflation and taxes so that long
term you know you never have to go back
to work and that’s really what we want
to avoid we want to avoid being one of
those statistics of lottery winners who
went bankrupt and had to go back to work
rather we want to keep you safe and
secure and it’d be nice if you never had
to worry about money again so this would
be my advice to someone who had won the
lottery