Winning the lottery is something that many people dream about, but it is not necessarily a blessing unless they take the time to learn about finances and invest their money wisely. Often, instant millionaires feel the money will never run out. So, they spend and give away extravagant amounts only to end up penniless later. Some of them spend their winnings on consumable goods and invest in businesses they know nothing about that eventually fail
Travel
- Typically, people who win a lottery treat their families and themselves to travel to an exotic destination they have always wanted to visit. Some indulge in extended stays at extravagant resorts.
Real Estate
- Many people pay off their mortgages and those of their close friends and relatives or they buy a larger home. Investing in land and other types of real estate is common practice among lottery winners.
- Gifts for Friends
- Lottery winners find it difficult to say no to people who are struggling financially and often mere acquaintances come out of the woodwork wanting loans or gifts of money. Often, the winners want to give money to their parents, other relatives and friends to share the wealth and make their lives easier. If they do this without consulting a financial adviser, they may regret it because taxes can take a huge bite out of their winnings.
Better Lifestyle
- A large portion of a lottery winner's money is spent on enjoying a higher-quality lifestyle. Front-row seats at the opera, four-star restaurants, fancy hotels and new automobiles rate high on the list.
Debts
- Lottery winners generally pay off any existing debt, such as home and automobile loans, student loans, credit card debt and installment loans.
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