By Steven Rogé, MBA, AIF®, CMFC®
Director of Research and Portfolio Management
While we rang in the New Year with the Times Square ball drop, a lucky person just a few miles east in Long Island New York has been celebrating watching the mega millions ball drop in their favor. The Mega Millions drawing was worth $437 million, or $165 million with a lump sum payment after taxes. This amount of money is certainly life changing for anyone that is not already a billionaire.
While winning that amount of money is certainly exciting, it can also be overwhelming. Many lotto winners or those that unexpectedly come into large sums of money can experience an overwhelming sense of responsibility, anxiety, and sometimes guilt. It takes a unique type of personality to be able to quickly and prudently adapt to such a new circumstance.
There are a few tips that can alleviate some of these emotional pressures and get you off to a healthy start. You do not need to bare the brunt of the work, instead follow these tips.
First, prioritize your goals. Share these goals with your immediate family and make sure everybody is on the same page. Having trouble deciding what’s important? No problem, see our next tip.
Second, find a Fee-Only Financial Fiduciary Advisor who is also a Certified Financial Planner (CFP®). It’s important to work with a Fee-Only Fiduciary Advisor since they always act as a fiduciary and have your best interest in mind. Certified Financial Planners are trained in working with families prioritizing goals and can help work through your goals and family needs.
Third, make sure the Fee-Only Financial Fiduciary Advisor has experience with other lotto winners. You want an advisor that knows the ups and downs of managing through a range of financial obstacles with such a unique circumstance. The Advisor will be your financial quarterback, recommending third parties and coordinating appointments, double checking work, and pro-actively following-up to make sure assets are protected as best as they can be.
Some independent third-parties that you can expect to work with include an estate planning attorney to draft wills, trusts, and other legal documents to make sure your wishes are legal and binding. You will work with a tax professional such as a Certified Public Accountant (CPA) or Enrolled Agent (EA) to make sure taxes are minimized and filings are filled correctly. The third common professional will be an insurance agent who will asses your liabilities to protect what you have and to make sure that in the event of an accident that you are sufficiently covered. Your Fee-Only Financial Fiduciary Advisor will coordinate and work for you with these professionals to make sure you have a clear path to achieving future goals, whether it’s something as simple as retiring comfortably, or setting-up charitable gifting.
Winning the lottery is such a low probability event but working with a Fee-Only Certified Financial Planner (CFP®) can improve the odds of protecting your assets and achieving whatever goals you have.
Have you won the lottery or inherited a substantial amount of assets? To discuss your financial future with a “Fee-Only” Fiduciary advisor, contact us at 631.218.0077 or at firstname.lastname@example.org to schedule a complimentary consultation.
© Copyright 2019 R. W. Rogé & Company, Inc. All Rights reserved.
CFP® is a registered trademark of the Certified Financial Board of Standards.
Steven Rogé, MBA, AIF®, CMFC® is Director of Research and Portfolio Manager of R. W. Rogé & Company, Inc. 603 Johnson Avenue, Suite 103, Bohemia, NY 11716. Phone: (631) 218-0077; Website: www.rwroge.com