Don’t Get Blown Away By A Cash Windfall
4 Tips for Managing Sudden Wealth
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C
ongratulations – you just won
the lottery! Or, in a more realistic
scenario, a significant amount of
money has landed in your lap through
an inheritance or the sale of property.
Now what?
By Ryan Dumermuth,
CPA, CFP, principal
(Mentor office)
As many who have been in your shoes will
attest, it’s important to pause, take a step
back, and evaluate your options before
making any big financial decisions. Sure,
that brand new sports car would look
great in your driveway, but will you regret
spending the money down the road? Significant money creates many opportunities.
Some? Wonderful. Others? Money pits.
Before you make a move with your money,
think it through and talk to a pro. The
truth is, there’s no right answer, as no
two financial situations are exactly alike.
But these four steps will help you decide
what’s best for you.
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one, and you owe yourself this honest
examination. Use your missteps to your
advantage.
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DO YOUR HOMEWORK. If your decisions affect others, talk with them before
acting. If someone has an investment
idea, consider whether it’s too good to
be true.
If you are approached to help a charitable cause, ask yourself if it’s something
you’re passionate about. And make sure
you have an understanding of the organization. You should also find out if they
will publicize your contribution.
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CONSULT WITH A PRO. Navigating new
wealth is complicated, and it’s imperative
you find experts to help guide you through
the process. Talk with a few people you
trust and respect. If an advisor’s name is
mentioned more than once, it’s probably
someone you should talk to. If you already
have an advisor, consider whether or not
they are up to the task at hand.
SLOW DOWN. It’s easy to get caught up
in the excitement of new wealth, and the
tailspin that can ensue. But don’t allow
yourself to lose your footing and don’t
be tempted to make excuses for reck- You’ll want to work with a CPA, attorney
and investment advisor. Be prepared
less spending.
to invest some time meeting with each
Avoid making any significant or impulsive advisor in an effort to decide who to hire.
purchases for at least a month or two. Each o