There is an old proverb that states that it is easier to earn money than to keep it, and as South Africa’s latest lotto winner claims his R232-million windfall, most of us can only dream about what it would be like to come in to so much cash.
To all those in this fortunate position – be it through inheritance, prize money, annual bonuses or simply being the owner of the correct lotto digits – it is necessary to take steps to not only preserve your windfall, but to grow your wealth too.
According to research, about 70% of lottery winners, or people who receive a sudden windfall by some other means, end up broke and a third go on to declare bankruptcy within about five years.
Financial experts warn that most ordinary people who suddenly come into a large amount of money often lose all sense of reality and end up squandering their fortune on luxury cars, houses, designer label clothing and expensive holidays, coupled with bad investment decisions. Lottery winners also tend to give away too much money to family and friends, instead of investing their winnings wisely.
What an opportunity to waste when you can conserve, and grow your investment in a few easy steps. This is according to Riaan Verbeek, CFO of Momentum Consult.