The Canadian Lottery 649 prize reached over $41,000,000 last week. There were two winners, only one of whom has come forward at the time of writing, a grocery clerk who earns less than $15.00 per hour. As I watched this lucky lady, the main thought going through my mind was the hope that she gets good, sound advice.

             Throughout my career I’ve advised seven people who won large lottery prizes. Following is the advice I gave to them all.

              Pick up your winnings as soon as you can. Even at today’s almost invisible interest rates, forty-one million dollars will earn about $1,000 a day, and you may as well have that money as the government. Don’t forget, it’s governments that run lotteries.

             But, there’s more to worry about than just getting the money. You will not be able to escape publicity because the lottery corporation has the right to publicize your win; and they will. The result is that a horde of full-time money chasers, including less fortunate relatives and friends, will learn of your good fortune. You will be flooded with requests for money – not only beggars and crackpots, but charities, salespeople, investment advisors, hopeful entrepreneurs, and possibly extortionists will be on your trail. Be wary of them all.

             But you also have to be wary of yourself. Resist those initial urges to go out and buy fancy cars and flashy watches. In fact, don’t make any rash decisions. After cashing in the ticket and arranging for the money to earn interest, pay off all your debts, especially your mortgage.

             Then put all the money, except for $30,000 or so into a combination of three-month guaranteed term deposits, guaranteed investment certificates and treasury bills. Now take your $30,000, your close family members, and your suntan oil and disappear to an undisclosed haven for a month or so. This will allow you to avoid the storm of publicity with all its temptations and dangers, and will also allow you to take time to adjust to your new-found wealth. After the euphoria of winning wears off you will be in a much better position to decide exactly what to do with your money – what to buy, how to invest, and how much to give away and to whom.

              You will need reputable, professional financial help in the conduct of your financial affairs, and the best way to find the right advisor is a referral from one or more people whose judgement you have reason to respect.

              Don’t immediately begin living like the millionaires who’ve had their money for a number of years. If you move to their part of town, and try to move in their circles, you’re apt to find that your relatives and life-long friends don’t relate to you anymore, and your new neighbours may not accept you either. Upgrade your standard of living and lifestyle by all means, but do it slowly and carefully.

             Now, what about winning a more modest amount, say $250,000? Well, $250,000, although it won’t fulfill your wildest dreams of wealth and luxury, can bring you a measure of security. Just as with the monster win, there are a few things you should do and some you should emphatically not do.

            Unless you’re very close to retirement age, $250,000 is not enough to retire on. $250,000 is enough to give you a nice head start in life, but not enough to change your whole lifestyle or to run wild on for any length of time. Use your win to improve your existing lifestyle. Pay off debt – especially some or all of your mortgage. Perhaps you’ll now be able to buy a vacation property, or go back to school. Maybe buy that car you always wanted. Have a little fun with it, but be prudent. It simply isn’t enough money for drastic changes and dramatic spending.