A financial planner can help you make the best decisions for the future with this sudden change in your financial situation.
Take Time to Adjust
It’s normal to feel overwhelmed by sudden wealth and the decisions around what to do with it. Take time to adjust (6 months to a year is not uncommon) and work through any emotions you are feeling before making big financial decisions.
Delay Big Financial Decisions Until You Feel Comfortable
Your emotions can influence you to make decisions that you would not normally make. Be careful with granting requests for money from family, friends and charities until you have a plan in place. You may even want to put aside a small amount of “fun money” to do something you enjoy, and to help you avoid impulse decisions.
Consider a Short-Term, Flexible Investment
While you are deciding what to do with your money, consider putting it in a Treasury bill or redeemable guaranteed investment certificate (GIC) that will guarantee your original investment but still keep the money liquid. This will give you time to seek professional financial advice.
Make and Prioritize Your Wish List
Take stock of your current financial situation and needs. It can be as simple as making a list on one sheet of paper. Then, take some time to think about all the possible uses for your new wealth. A financial planner can help you with this step and also provide independent, objective advice.
Have a Long-Term Plan
Consider creating a personalized financial plan with the help of a financial planner. It will give you better insight into whether you can achieve your long-term objectives, such as living a certain lifestyle or gifting a large amount to charity. It will also help you to plan for and focus on short-term objectives, such as renovating your home or helping out family members.
How Can I Be a Smart Investor?
Should I Retire Early?
Should I Pay Down My Mortgage or Invest?