It could be you.
Money doesn’t come with a set of instructions, especially sudden mega-windfalls like the Euro Lotto. The celebrations will be long-lasting and many a glass will be raised in your honour, but there are some serious financial decisions that need to be made when a lorry load of cash suddenly arrives at your feet. After all, why do you think so many lotto winners choose to stay anonymous?
So, seems that we’re playing pretend, let’s imagine you’ve won the lotto and have, finally, managed to pick yourself up off the floor. What kind of smart financial thinking needs to quickly replace the euphoria?
Financial advice for the lucky lotto winner!
1. Get good at keeping secrets
Of course, you want to shout about your Euro Lotto winnings from the rooftops and you can, just not straight away. Let’s be honest, when you hear about a lotto win what is the first thing you think about? After silently congratulating the now affluent stranger (aka cursing their dumb luck), you then start to daydream about how you would spend that money. Everybody does this.
Therefore, now that you’ve won the lotto, you can expect everyone around you to start daydreaming about how they would spend your money. They’re only human, but still, say nothing. That means continuing to drive your old car, going to the same shops and generally sticking to your usual routine for a while. It will be surreal, but it will also be kind of fun!
2. Get professional financial advice – from Mike Tyson??
“If it depreciates, lease it. If it appreciates, buy it,’’ was the financial advice Mike Tyson gave the former Ultimate Fighting Championship featherweight and lightweight champion, Conor McGregor. Tyson may not seem like a great person to take financial advice from, but life is a great teacher, especially when you’ve been seriously knocked back.
However, by professional financial advice, we do mean wealth management advice from a qualified source. No one is equipped to go from near zero to near €100m overnight – that’s CEO level of a large Irish company. You’ll need to learn how to manage your new financial situation and a good governance model is vital. Start estate planning and get a top-class solicitor.
Expect many local “experts” to pop up lured in by the commission, but bear in mind none of them are likely to have experience or knowledge about your unique situation. You’ll realise this quickly the minute they start yapping about common, garden-variety financial products. Everyone, from your next-door neighbour to the media is going to want to give you advice, but it’s your job to block out the noise and seek out only the best.
3. Take the bullseye off your back
It only makes sense to review safety and security now that you’re the local big shot. There are all kinds of security issues to take into consideration, such as your personal safety, your family’s safety and the security of your assets. For example, cybercriminals are stalking the unprepared and losses can be catastrophic if they intercept large-scale money movements.
As a general rule, we would say do not concentrate your money in any single asset class, like property or cash deposit. Instead, expect to spread your wealth widely, ideally using a panel of asset managers who use custodians to protect your money from their balance sheets. That means using top international specialists in investing private wealth.
4. Go global with your banking
This may be a surprise, but keeping your money in the local branch isn’t the best idea in these circumstances. It’s time to think big and move your Euro Lotto winnings across at least 50 global banks with the highest credit rating through an AAA-rated Euro liquidity fund – in Luxembourg for example. Then sit on it for a year.
5. Decide who is in your circle of trust
When you do finally share the news, don’t be shocked to find out that not everyone is going to be their best self. With financial advisors on your side, plan well in advance of the big reveal what money you plan to share, how you will go about sharing it and who will receive it. It may sound straightforward, but handouts without conditions can turn into a long-term dole and can destroy ambition and wreck careers. Don’t become a safety net. It’s instinctive but damaging.
6. Take some time out
You don’t need to be told this. In fact, you’re probably already in Barbados with a coconut cocktail in your hand! But apart from going abroad for recreational reasons, it’s a good idea to get some distance while the dust from your rocket launch to Millionairesville settles. Think about emigrating for a few years, coming and going to Ireland while you reconstruct your life.
7. Think long-term
The global financial system is still unsafe, so expect to play a defensive game for the next few years. Apart from that, look about the family to discern who is the best candidate to be there for you so you can pass on your learnings and wealth to the next generation. If you do this right, you’re going to change the course of your lineage for the better. Go you!