Essentials to Make Your Windfall Last

Acclimate

Regardless of whether your windfall is anticipated or unexpected, it’s essential that you take time to adjust to your new situation. Things are unfamiliar and the ultimate goal at the beginning is to minimize bad decisions. I’ve seen many first-year NBA players make regrettable big-ticket purchases before they’ve even played a single game. This isn’t a race to see who can spend their money the fastest. Take your time and get to know your new circumstances. You don’t have to rush into anything.

Plan & Educate

After you’ve acclimated, now is the time to construct your plan. To do this, you have to determine the purpose you’d like your windfall to serve. As this is going on, it’s important that you begin to familiarize yourself with the role each potential investment would play in your plan. This should be a collaborative effort between adviser and client and cannot fall solely on one party. Once proficient understanding is established, a plan can be created that allows you to recognize how your money will serve its intended purpose.

Monitor

Once you’ve put your plan into action, you’re not out of the woods. The biggest key now is to not allow your expenses to get out of hand. Luckily, this is an area that you can monitor and control. I do this on a monthly basis in order to get ahead of any little issues before they become big problems. It’s amazing because even on months where I anticipate being well under the previous total, the seemingly little expenses over the month have added up. Also, don’t fall for the trap of only looking at the previous month. Look at six months and a year ago as a comparison as well. Beyond controlling expenses, check things on a regular basis. Are you ahead of the expected projection? If so, what are you doing right? If not, what changes have to be made? Take responsibility, and make sure your windfall is heading in the desired direction.