Comments on: How to Manage a Windfall Successfully http://www.getrichslowly.org/blog/2006/10/19/how-to-manage-a-windfall-successfully/ personal finance that makes cents Thu, 24 Jul 2008 01:44:36 +0000 http://wordpress.org/?v=2.5.1 By: The Honest Dollar | Avoid the Wealth Effect http://www.getrichslowly.org/blog/2006/10/19/how-to-manage-a-windfall-successfully/#comment-118584 The Honest Dollar | Avoid the Wealth Effect Thu, 21 Feb 2008 15:11:34 +0000 http://www.getrichslowly.org/blog/2006/10/19/how-to-manage-a-windfall-successfully/#comment-118584 [...] If you receive an unexpected windfall, then stick it into a short-term CD (6 months or so). Because you haven’t had time to plan, a surprise windfall is far more likely to trigger overspending and an unmanageable wealth effect. By locking the money away for a few months, you have some time to deal with any unanticipated problems (including emotional tumult resulting from the surprise). The Bogleheads’ Guide to Investing has a great chapter towards the end on handling large, unexpected windfalls. J.D. at Get Rich Slowly offers a great summary. [...] [...] If you receive an unexpected windfall, then stick it into a short-term CD (6 months or so). Because you haven’t had time to plan, a surprise windfall is far more likely to trigger overspending and an unmanageable wealth effect. By locking the money away for a few months, you have some time to deal with any unanticipated problems (including emotional tumult resulting from the surprise). The Bogleheads’ Guide to Investing has a great chapter towards the end on handling large, unexpected windfalls. J.D. at Get Rich Slowly offers a great summary. [...]

]]> By: deRuiter http://www.getrichslowly.org/blog/2006/10/19/how-to-manage-a-windfall-successfully/#comment-115229 deRuiter Fri, 01 Feb 2008 15:47:54 +0000 http://www.getrichslowly.org/blog/2006/10/19/how-to-manage-a-windfall-successfully/#comment-115229 Well this isn't so hard! Take a deep breath! Mourn dear Auntie Maude or whomever kicked the bucket and left this largesse. 1. Pay taxes due if any. 2. Pay off your debts and cut up credit cards. 3. Splurge with 5% of whatever you got, if you're into splurging. 4. Pay off your mortgage or pay down a big chunk of the mortgage, SO YOU WILL HAVE SOMETHING IF YOU SCREW UP WITH THE REST OF THE SWAG. Invest the balance in index funds and a bit in Coca Cola or Walmart stock. Relax and enjoy life. By paying off debt and paying off or down your house, YOU WILL NOW HAVE EXTRA DISPOSABLE INCOME EVERY WEEK. Spend that weekly extra, DO NOT SPEND YOUR PRINCIPLE WHICH IS IN INDEX FUNDS AND STOCK. Well this isn’t so hard! Take a deep breath! Mourn dear Auntie Maude or whomever kicked the bucket and left this largesse. 1. Pay taxes due if any. 2. Pay off your debts and cut up credit cards. 3. Splurge with 5% of whatever you got, if you’re into splurging. 4. Pay off your mortgage or pay down a big chunk of the mortgage, SO YOU WILL HAVE SOMETHING IF YOU SCREW UP WITH THE REST OF THE SWAG. Invest the balance in index funds and a bit in Coca Cola or Walmart stock. Relax and enjoy life. By paying off debt and paying off or down your house, YOU WILL NOW HAVE EXTRA DISPOSABLE INCOME EVERY WEEK. Spend that weekly extra, DO NOT SPEND YOUR PRINCIPLE WHICH IS IN INDEX FUNDS AND STOCK.

]]> By: Ask the Readers: I’m Not Good With Money — How Should I Handle a Windfall? ? Get Rich Slowly http://www.getrichslowly.org/blog/2006/10/19/how-to-manage-a-windfall-successfully/#comment-115187 Ask the Readers: I’m Not Good With Money — How Should I Handle a Windfall? ? Get Rich Slowly Fri, 01 Feb 2008 13:00:19 +0000 http://www.getrichslowly.org/blog/2006/10/19/how-to-manage-a-windfall-successfully/#comment-115187 [...] Bogleheads’ Guide to Investing has a great chapter on how to manage a windfall successfully. I’ve shared this advice before, but it’s worth repeating. The authors say that if you [...] [...] Bogleheads’ Guide to Investing has a great chapter on how to manage a windfall successfully. I’ve shared this advice before, but it’s worth repeating. The authors say that if you [...]

]]> By: Adventures In Money Making http://www.getrichslowly.org/blog/2006/10/19/how-to-manage-a-windfall-successfully/#comment-90864 Adventures In Money Making Tue, 26 Jun 2007 07:46:18 +0000 http://www.getrichslowly.org/blog/2006/10/19/how-to-manage-a-windfall-successfully/#comment-90864 well i've never inherited or won anything, but i've come into considerable lumps of change. the first time was about 2.5 times my annual salary, the second was about 1.1 times annual salary and just recently about 80% of my annual salary. they all came from sale of appreciated property. 10% goes towards splurging and the rest gets reinvested. well i’ve never inherited or won anything, but i’ve come into considerable lumps of change.
the first time was about 2.5 times my annual salary, the second was about 1.1 times annual salary and just recently about 80% of my annual salary.

they all came from sale of appreciated property. 10% goes towards splurging and the rest gets reinvested.

]]> By: plonkee money » mentally spending a non-existant windfall http://www.getrichslowly.org/blog/2006/10/19/how-to-manage-a-windfall-successfully/#comment-88824 plonkee money » mentally spending a non-existant windfall Thu, 07 Jun 2007 11:11:09 +0000 http://www.getrichslowly.org/blog/2006/10/19/how-to-manage-a-windfall-successfully/#comment-88824 [...] to have an idea how I would spend any further substantial windfalls. This idea is also explored in Chapter 15 of The Bogleheads Guide to Investing which was the subject of a blog book [...] [...] to have an idea how I would spend any further substantial windfalls. This idea is also explored in Chapter 15 of The Bogleheads Guide to Investing which was the subject of a blog book [...]

]]> By: Working Dollars: Investment Lessons from 1957 ? Get Rich Slowly http://www.getrichslowly.org/blog/2006/10/19/how-to-manage-a-windfall-successfully/#comment-88232 Working Dollars: Investment Lessons from 1957 ? Get Rich Slowly Sat, 02 Jun 2007 17:46:16 +0000 http://www.getrichslowly.org/blog/2006/10/19/how-to-manage-a-windfall-successfully/#comment-88232 [...] self-discipline and refrains from increased spending, the extra money from a raise (or from a windfall) can be put into savings. Or invested. If she’s willing to maintain her standard of living, [...] [...] self-discipline and refrains from increased spending, the extra money from a raise (or from a windfall) can be put into savings. Or invested. If she’s willing to maintain her standard of living, [...]

]]> By: plonkee money » spend your windfalls http://www.getrichslowly.org/blog/2006/10/19/how-to-manage-a-windfall-successfully/#comment-88108 plonkee money » spend your windfalls Fri, 01 Jun 2007 16:18:11 +0000 http://www.getrichslowly.org/blog/2006/10/19/how-to-manage-a-windfall-successfully/#comment-88108 [...] pf blogs, JLP developed a project on The Bogleheads Guide to Investing, which also covered what to do in the event of receiving a windfall. What I think is interesting about this is the suggestion to spend some of the money (1-2%) on [...] [...] pf blogs, JLP developed a project on The Bogleheads Guide to Investing, which also covered what to do in the event of receiving a windfall. What I think is interesting about this is the suggestion to spend some of the money (1-2%) on [...]

]]> By: Jack Bogle Q&A: "Ignore Expectations" | Online Savings Blog http://www.getrichslowly.org/blog/2006/10/19/how-to-manage-a-windfall-successfully/#comment-81744 Jack Bogle Q&A: "Ignore Expectations" | Online Savings Blog Tue, 20 Mar 2007 22:39:06 +0000 http://www.getrichslowly.org/blog/2006/10/19/how-to-manage-a-windfall-successfully/#comment-81744 [...] just ordered The Bogleheads' Guide to Investing, which has received positive reviews from around the blogosphere. (Many PF bloggers got together to review the book, chapter by chapter. [...] [...] just ordered The Bogleheads' Guide to Investing, which has received positive reviews from around the blogosphere. (Many PF bloggers got together to review the book, chapter by chapter. [...]

]]> By: Brendan http://www.getrichslowly.org/blog/2006/10/19/how-to-manage-a-windfall-successfully/#comment-26247 Brendan Thu, 07 Dec 2006 16:18:27 +0000 http://www.getrichslowly.org/blog/2006/10/19/how-to-manage-a-windfall-successfully/#comment-26247 Great review. I <a href="http://www.catchagideon.com/2006/11/22/manage-a-windfall-successfully-ch-15-bogleheads-series/" rel="nofollow">reviewed this chapter</a> too. It has to be almost impossible not to go out and spend the money immediatly. I've never received a windfall at all, but friends have and they immediately try to boost their social standing by displaying their new found wealth. <a href="http://www.successfulpersonalfinance.com" rel="nofollow">Successful Personal Finance.com</a> Great review. I reviewed this chapter too.

It has to be almost impossible not to go out and spend the money immediatly. I’ve never received a windfall at all, but friends have and they immediately try to boost their social standing by displaying their new found wealth.

Successful Personal Finance.com

]]> By: FIREFinance http://www.getrichslowly.org/blog/2006/10/19/how-to-manage-a-windfall-successfully/#comment-11444 FIREFinance Mon, 23 Oct 2006 17:58:38 +0000 http://www.getrichslowly.org/blog/2006/10/19/how-to-manage-a-windfall-successfully/#comment-11444 Great Review. Thanks a lot for your hard work. Cheers, FIRE Finance Great Review. Thanks a lot for your hard work.
Cheers,
FIRE Finance

]]> By: Hal http://www.getrichslowly.org/blog/2006/10/19/how-to-manage-a-windfall-successfully/#comment-11421 Hal Mon, 23 Oct 2006 15:14:40 +0000 http://www.getrichslowly.org/blog/2006/10/19/how-to-manage-a-windfall-successfully/#comment-11421 Put 12 months salary in savings??? What ever happened to 3-6 months?!? All that cash seems like a wasted opportunity to buy mutual funds. Put 12 months salary in savings??? What ever happened to 3-6 months?!?

All that cash seems like a wasted opportunity to buy mutual funds.

]]> By: Lifehacker http://www.getrichslowly.org/blog/2006/10/19/how-to-manage-a-windfall-successfully/#comment-11394 Lifehacker Mon, 23 Oct 2006 13:32:13 +0000 http://www.getrichslowly.org/blog/2006/10/19/how-to-manage-a-windfall-successfully/#comment-11394 <strong>How to manage a windfall successfully...</strong> So it turns out you were old Aunt Boozy's favorite, and she left you $50,000 in her will. Or maybe you just got a fat check from the supermarket after that slip-and-fall accident in the ketchup aisle. Whatever the...... How to manage a windfall successfully…

So it turns out you were old Aunt Boozy’s favorite, and she left you $50,000 in her will. Or maybe you just got a fat check from the supermarket after that slip-and-fall accident in the ketchup aisle. Whatever the……

]]> By: fivecentnickel.com http://www.getrichslowly.org/blog/2006/10/19/how-to-manage-a-windfall-successfully/#comment-11357 fivecentnickel.com Mon, 23 Oct 2006 02:30:34 +0000 http://www.getrichslowly.org/blog/2006/10/19/how-to-manage-a-windfall-successfully/#comment-11357 <strong>Weekly Roundup - 10/20/06...</strong> Here’s a quick look at posts that caught my eye over the past week (better late than never)… JLP has a nice post on building wealth with other people’s money. Jim gives us the skinny on paying estimated taxes on a quarterly basis. F... Weekly Roundup - 10/20/06…

Here’s a quick look at posts that caught my eye over the past week (better late than never)…

JLP has a nice post on building wealth with other people’s money.
Jim gives us the skinny on paying estimated taxes on a quarterly basis.
F…

]]> By: prlinkbiz http://www.getrichslowly.org/blog/2006/10/19/how-to-manage-a-windfall-successfully/#comment-11122 prlinkbiz Fri, 20 Oct 2006 15:21:28 +0000 http://www.getrichslowly.org/blog/2006/10/19/how-to-manage-a-windfall-successfully/#comment-11122 Saving money will pay off in the long run? Only if you put it back into income producing assets. Saving money will pay off in the long run? Only if you put it back into income producing assets.

]]> By: Cat http://www.getrichslowly.org/blog/2006/10/19/how-to-manage-a-windfall-successfully/#comment-11093 Cat Fri, 20 Oct 2006 04:16:44 +0000 http://www.getrichslowly.org/blog/2006/10/19/how-to-manage-a-windfall-successfully/#comment-11093 This seems like a very instructive book, from the reviews I've read on different blogs. I look forward to reading it. My husband and I have also been reading "The Warren Buffet Way," and it also has great investing advice. Anyone who has read "The Millionaire Next Door" should be truly motivated to follow the Bogleheads' advice. Saving money takes a lot of self restraint, but it will pay off in the long run. This seems like a very instructive book, from the reviews I’ve read on different blogs. I look forward to reading it. My husband and I have also been reading “The Warren Buffet Way,” and it also has great investing advice. Anyone who has read “The Millionaire Next Door” should be truly motivated to follow the Bogleheads’ advice. Saving money takes a lot of self restraint, but it will pay off in the long run.

]]> By: prlinkbiz http://www.getrichslowly.org/blog/2006/10/19/how-to-manage-a-windfall-successfully/#comment-11069 prlinkbiz Thu, 19 Oct 2006 22:23:58 +0000 http://www.getrichslowly.org/blog/2006/10/19/how-to-manage-a-windfall-successfully/#comment-11069 It's not that much money ya'll- but if it is immediately put back into income producing investments, you'll be set up for life. Savings and slow moving investment vehicles will lose you money over time. Learn self control and learn to grow and keep the money you make today so if you ever have a windfall you will already be trained. It’s not that much money ya’ll- but if it is immediately put back into income producing investments, you’ll be set up for life. Savings and slow moving investment vehicles will lose you money over time. Learn self control and learn to grow and keep the money you make today so if you ever have a windfall you will already be trained.

]]> By: rich http://www.getrichslowly.org/blog/2006/10/19/how-to-manage-a-windfall-successfully/#comment-11054 rich Thu, 19 Oct 2006 20:52:43 +0000 http://www.getrichslowly.org/blog/2006/10/19/how-to-manage-a-windfall-successfully/#comment-11054 The best instructions I've ever read on what to do if you win big (bigger than $50,000, for that matter) in a lottery are in the Rotten Library: http://www.rotten.com/library/culture/lottery-winners/ Please note that much of the excellent Rotten Library is not safe for work, and pretty much all of the *rest* of Rotten.com is not excellent and *very, very, very* not safe for work. But that one page about lotteries is safe for work. The best instructions I’ve ever read on what to do if you win big (bigger than $50,000, for that matter) in a lottery are in the Rotten Library:

http://www.rotten.com/library/culture/lottery-winners/

Please note that much of the excellent Rotten Library is not safe for work, and pretty much all of the *rest* of Rotten.com is not excellent and *very, very, very* not safe for work. But that one page about lotteries is safe for work.

]]> By: AllFinancialMatters » Blog Archive » Bogleheads’ October Project - Chapter 15 http://www.getrichslowly.org/blog/2006/10/19/how-to-manage-a-windfall-successfully/#comment-11053 AllFinancialMatters » Blog Archive » Bogleheads’ October Project - Chapter 15 Thu, 19 Oct 2006 20:35:46 +0000 http://www.getrichslowly.org/blog/2006/10/19/how-to-manage-a-windfall-successfully/#comment-11053 [...] J. D. of GetRichSlowly has just posted an excellent review of Chapter 15 - How to Manage a Windfall Successfully. For those of you who don’t know, myself and 21 other bloggers are each reviewing a chapter of The Bogleheads’ Guide to Investing during the month of October. We are calling it the Bogleheads’ October Project. It’s been a lot of fun and we invite you to read along. Bookmark to:            [link] [...] [...] J. D. of GetRichSlowly has just posted an excellent review of Chapter 15 - How to Manage a Windfall Successfully. For those of you who don’t know, myself and 21 other bloggers are each reviewing a chapter of The Bogleheads’ Guide to Investing during the month of October. We are calling it the Bogleheads’ October Project. It’s been a lot of fun and we invite you to read along. Bookmark to:            [link] [...]

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