WHAT TO DO WITH WITH A SUDDEN WINDFALL

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D. Gates Wealth Management

Posted on

Mar 16, 2023

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Florida - Southwest

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While winning the lottery is well outside mainstream reality for most people, it’s not uncommon to suddenly receive a large inheritance, a settlement, or perhaps a stroke of good luck. There are several stories of the major failings of people who’ve come into money only to see it disappear. If you find yourself with a sudden windfall, here are some tips that may help you avoid following down the same path:

AVOID PUBLICITY

You may want to take some time and space to process your windfall and think through your next steps. While you may feel you’re surrounded by well-intentioned people, there’s a chance that not everyone has your best interests in mind.

In some cases, if you tell one person, you may as well publicly post on social media. This could be difficult if you come into an inheritance unless it was passed to you through a trust. In general, when assets pass by trust, they avoid probate proceedings which are a matter of public record.

CONSIDER PROFESSIONAL GUIDANCE

Instant wealth can make life much more complex. With the new opportunities it brings, some people quickly wipe out portions of their new-found wealth through ineffective tax planning, guilt-induced generosity, or poor cash flow management. Money decisions can be emotional, which is why some people work with a financial professional that serves as an emotionally-neutral party and provides personalized guidance to help them stay on track.

Depending on your needs, you may also want to consider working with a tax professional, an attorney, and an insurance professional. If you aren’t sure where to start, your financial professional may have a network of other specialists they can recommend.

STRIVE FOR SUFFICIENCY

You may be faced with several decisions and opinions on how to allocate your money. Depending on the size of your windfall, you may have a broad range of options available. Many people feel that creating a guaranteed stream of income is a good starting point. It’s believed that, if anything were to happen to your assets, you’re more prepared to sustain yourself for a period of time. There are several ways to create an income stream, and your financial professional can help you find the solution that works for your needs, risk tolerance, and goals.

HAVE A PLAN FOR FRIENDS AND FAMILY

This can be one of the touchiest parts of being a windfall recipient. Depending on the size of your windfall and the degree of investment in your financial future, you may have philanthropic desires, including giving back to friends and family. But it’s not uncommon to feel overrun with requests from people you haven’t spoken to in years. One way to reduce the awkwardness of dealing with requests is to forward them to your financial professional, who can give out predetermined sums. It’s not uncommon for people with newfound wealth to be on a salary controlled by their financial professional.
 
If you’ve recently received a large inheritance or another windfall, contact us and let’s create a strategy that will help you pursue your goals.


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Local Services By This Author

D. Gates Wealth Management

Financial Advisor 1708 Southeast 47th Street, Cape Coral, Florida, 33904

We, at D. Gates Wealth Management, along with LPL Financial, are dedicated to helping our clients make informed financial decisions about issues that affect their financial needs, goals, and objectives. We strive to help clients to create a sense of financial well-being toward pursuing financial freedom. Additionally, we work with clients to determine what is important in their lives be creating a comprehensive financial plan centered around their values.Whether you're just starting out or you've already built a strong financial foundation and want to know what's next, D. Gates Wealth Management can help you take the next step.COMPREHENSIVE FINANCIAL PLANNINGCash Flow PlanningInvestment ManagementRetirement PlanningSocial Security OptimizationEducation FundingInsurance & Risk ManagementTax Management PlanningEstate PlanningINVESTMENT MANAGEMENTRisk AnalysisInvestment Policy DevelopmentTax Management PlanningPortfolio ManagementBUSINESS PLANNINGRetirement PlanningGroup BenefitsProfitability AnalysisSuccession Planning

D. Gates Wealth Management

Financial Services 1708 SE 47th St #2, Cape Coral, Florida, 33904

For over 20 years, Danielle has been helping professionals and their families gain a sense of clarity and confidence about their financial future. She is driven by her desire to help people turn their complicated and often overwhelming financial pictures into goal-based, comprehensive wealth management strategies that they can feel good about. Danielle's commitment to helping her clients navigate their financial lives has served as the foundation for her financial services practice, D. Gates Wealth Management. Danielle Gates is a Certified Financial Planner and her personal goal is to be a lifetime resource for each and every client. In her free time, Danielle enjoys pedaling her bike through local trails and beaches, hiking, and traveling.