If your credit problems are because of taxes, you can end your tax nightmare today! A licensed attorney will negotiate with
the IRS and save you money. Click here for FREE Tax
Law help today! Be sure and look at the testimonials. The results are stunning.
When the Dream Turns into a Nightmare: The Lottery and Bankruptcy
Susan Dunn, MA, The EQ Coach
I wonder how many of the people hustling now to declare bankruptcy before the laws change in October are saying to themselves, "If only I could win the lottery my problems would be over".
Probably quite a few.
And, as it turns out, they might find it was no solution.
A recent article on msn.com about 8 lottery winners was a sobering account of bankruptcy, betrayal, greedy relatives, poor investments, divorce, alienation from families, jail time, and food stamps. Consider William "Bud" Post who won $16.2 million in the Pennsylvania lottery in 1988 and now lives on his social security.
"Winning plays a game with your head," wrote Ellen Goodstein, author of the article.
It appears that winning the lottery is being given enough rope/money to hang yourself, or to wrap the package up with a nice bow on top.
If a windfall messes with your head, let's take a look at this from the EQ standpoint, because keeping your head Unmessed is what emotional intelligence is all about.
According to Susan Bradley, certified financial planner and author of "Sudden Money: Managing a Financial Windfall," winners get into trouble because they fail to address the emotional fallout from the windfall.
"There are two sides to money," Bradley says. "The interior side is the psychology of money and the family relationship to money. The exterior side is the tax codes, the money allocation, etc."
She recommends being able to integrate the two. This is about remaining level-headed, like integrating the two hemispheres of your brain, or integrating thinking and feeling. Only harder. Hit with a tsunami of emotions, lottery victims, I mean winners, are "flooded," and unable to make good decisions. Bradley calls them "fragile and vulnerable," referring to the effects of this highly-charged emotional state. Unable to deal with both parts of the equation, they end up with money but no family, or family but no money, or, in the worst-case scenario, neither family nor money.
While attempting to cope with the emotions, they must make decisions with no intellectual knowledge of how to manage large sums of money, including how to invest, how to save, what the actual payout (say $50,000 a year) feels like, or how much it costs to maintain a half-a-million-dollar home and 60' swimming pool.
At the same time, they have no experience or knowledge of how to deal with "flooding," or the emotions and behavioral changes of relatives and friends around these issues.
And, lastly, their ability to interpret their "gut feelings" in regards to whom to trust as partners, investment advisors and money managers, and how to correctly assess the motivations and intentions of family and friends, is washed away when the flood waters rise.
Does this sound familiar? Do you know someone whose spouse died and they made a disastrous remarriage choice 6 months later? Heard of someone whose wife left him and he made such poor business decisions he lost his license, practice and retirement fund along with his wife? Did someone tell you about two people who made bad decisions regarding their children in the months following divorce? Are you recently widowed and listening to friends advise you not to make any serious decisions for at least a year?
Waiting to make decisions until after the crisis has passed can be crucial. Why "crisis"? Psychologically, extremes are the same. Whether the event is extremely good or extremely bad, our normal floodgates can't withstand the force of the emotions. This is why we sometimes say we can't tell whether something is a good thing or a bad thing.
When fragile and vulnerable, we're bleeding, and the sharks can smell it. Sadly, loved ones, credentialed and licensed professionals, and even members of the cloth can turn out to be predators.
Where can you turn at such a time? Well, that's the big question. Ultimately you're on your own. Therefore it's good to have developed your emotional intelligence, and to have learned what to expect from transitions, and how to cope with them.
EQ involves a set of life competencies which can be learned, and an EQ coach can provide resources for catching up on life skills you may have missed acquiring, such as saving, investing, understanding your relationship with money, and learning how your intuition, rightly interpreted and rightly used, can keep you safe.
Talk to any mid-lifer and they'll likely confirm that their dreams-come-true that did turn out to be nightmares did so because the change was too extreme and they weren't able to stay afloat when the tidal wave hit.
Start improving your EQ now. You might need it later.
You can help your children learn this important lifeskill while they still have a safety net. Sometime along about high school or college, give your child a "windfall" and let them struggle with it.
Tom told me his second year in college, instead of sending him a check at the beginning of each month for $200 for mad money like she had the first year, his mother wrote him out a check in September for the full $1800 and gave it to him. (His father was covering all the necessities.)
"Spending all that money the first month and then living out the next 8 months without it was one of the best lessons I ever learned," says Tom, now 38 years old and a successful business owner who's paid off the mortgage and has money in the bank, a stock portfolio, life, health and car insurance, a retirement fund, and no credit card debt.
Why did his mother do that? "I knew my son would be inheriting money some day," she said, "and I wanted him to know what to do when it happened. I was a fund-raiser for a non-profit and routinely solicited families with inherited wealth. Invariably there was one family member who was living in a trailer park, or deep in debt because they hadn't known how to handle it. I watched my cousin when he inherited some money from his father. The first thing he did was buy two Porches, while his sister put hers in a mutual fund. If my son had the Porsche-syndrome, I wanted him to get it out of his system at a time in life when he couldn't do much harm. I knew he'd spent it, and it was painful for me to hold the line. To his credit, he never didn't ask me for more. It looks like he learned something from it."
Winning the lottery should be a dream come true. Who couldn't use a million or two? I hope it happens for you, and if it does, that you'll be prepared - with some EQ.
A home is not just a four-walled shelter; but for most of us its a long cherished dream. Its a place where you treasure your fondest memories. You work hard each day in order to save ample funds to purchase...
You Can Stop Debt Collectors Harassment! Burbank, CA (PRWEB) March 1, 2005 -- National Legal Debt Centers, Inc. www.nldc.us (3/1/05) With consumer debt increasing dramatically, some collectors are resorting...
When youre learning about something new, its easy to feel overwhelmed by the sheer amount of relevant information available. This informative article should help you focus on the central points. Bad credit...
