By Raúl Rodríguez Cota
22 Feb 2024, 17:27 PM EST
Winning the lottery may seem like the dream of many, but with victory comes unexpected responsibilities. The Best Life portal consulted with experts and identified seven common mistakes that winners make and that you should avoid if you ever hit the jackpot.
1. Lack of professional financial advice
Many winners do not seek professional financial help right away, which is very important to properly handle suddenly gained wealth.
It is important to have a financial advisor, a professional accountant and a lawyer.
2. Ignorance about taxes
Confusion about taxes on lottery winnings is common.
Taxes can be around 24% or more, meaning winners receive much less than their prize money.
3. Spending too soon
A common mistake is to start spending immediately, without a full understanding of the new wealth and its tax and financial implications.
It is advisable to wait at least a year before making large expenses.
4. Delay in investing money properly
Some winners become overwhelmed by investment options and postpone important decisions, thereby missing out on investment opportunities and the interest their earnings could have generated.
5. Getting carried away by the ego
Sudden increase in wealth can lead to ego-based ‘lifestyle growth’. This happens when winners spend on luxuries to impress others, which can lead to reckless spending.
6. Quitting work hastily
Leaving a job immediately after winning can have negative personal consequences, such as the loss of a routine, social connections with friends and colleagues, and a sense of purpose.
7. Not being prepared for negative consequences
Earning a large sum of money can lead to drastic changes in social dynamics and a feeling of isolation or loneliness.
Winners may face subtle resentment from friends and family and struggle with imposter syndrome as they enter elitist circles.
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