5. Do not let your old life’s debts and obligations remain in place.
If you suddenly become filthy rich, go out and get rid of your old financial obligations and debts immediately! If you get the bug in your head of “I’m rich and don’t have to pay anymore” then just know that you are dooming yourself. Whether you take the lump-sum or the annuity option, if you have a single penny of debt in the immediate future and distant future, then something is seriously wrong. For that matter, you should not have a single debt ever again. One lottery winner in California was reportedly strapped with debt from property purchases.
If you manage to go broke down the road and still have a mortgage, car payments, student loans, credit card debt and personal bills, all of your friends and family members should get to spank or ridicule you every day for the rest of your life.
6. Do not become a high-roller or go out and live the big life way too big.
Temptation to live lavishly can be a killer. If you go from living a simple life to instantly being able to spend hundreds of thousands of dollars (or more) per week, what do you think happens to your expectations in life ahead? Chances are high that you will want more of the same.
If you start gambling in Las Vegas and are not happy until you are gambling with hundreds of thousands of dollars (or more) per play, you are dooming yourself. Wait until the real con men find you. Taking you and your favorite 50 people on a luxury cruise around the world can become very expensive, very fast. Having an entourage generally only works for people who keep making more money.
7. Do not run out and buy everything for everyone (and not even for yourself).
Buying is fun. After all, society and the endless commercials make you think you need to own endless stuff. Do not go out and buy dozens of cars, followed by houses and whatever else, for you and your friends and family members. This will start you on a bad path, and you could easily become the next friends and family personal welfare department.
If you start buying everything for everyone, chances are high that they might expect that to last forever. The other end of the story is that you do not have to be a cheapskate either. Still, after hearing a real life personal story of one lucky winner buying more than 30 cars and multiple houses in three months it is just crazy.
8. Do not think that budgets are just for the poor and middle class.
Budgeting is not just for the poor and the middle class. Again, extreme wealth comes with extreme responsibility. It may sound crazy on the surface that you have to live within means when you get a vast sum of money. After all, major lottery winners are generally wealthier than everyone they know combined. This also goes back to having advisors and being prudent, but at the end of the day you do still have a finite sum of money. Chances are very high that you will make some serious purchases and your lifestyle will be changed forever.
Without setting limits for yourself and for what you do with others is a recipe for disaster. Again, many lottery winners go broke. If they went broke in a very short time, what do you think the reflection about wishing for a proper budget would be?