The biggest upside of winning the lottery is, of course, not having to worry about money for the rest of your life. That is why everybody keeps buying lottery tickets.
But how do you make sure that your lottery win keeps you in financial safety forever? Well, the first and most important thing is to invest your money wisely. Here are a few tips:
- Pay off all your loans – car financing, the mortgage on your house, and any other debt. Reducing your expense for interest payments is the smartest thing you can do.
- If you live in a rented house, go ahead and buy a house instead. Rent payments are money thrown out of the window.
- Whatever funds remain from your lottery win after those first 2 steps, split that money into 4 amounts. Invest 25% in blue-chip stocks, 25% in gold and other precious metals, 25% in secure government bonds, and if you want to, the remaining 25% can be used in higher-risk investments.
With any investment, there is a certain risk – try and minimize that risk. In general, any investment that promises interest rates of more than 8% must be considered as high-risk. The higher the alleged return percentage of the investment, the more careful you should be. Bear in mind that if you have a large amount of money to invest, you do not have to take this kind of risk.
All in all, if you invest wisely, you should be able to generate between 4% and 5% interest on your investments. Now let’s assume you have the amount of €2 million to invest – that should generate an income of €100.000,00 per year, or approximately €8.300,00 per month. That should be enough to maintain a very good lifestyle, without even touching your capital!