You won a large amount of money in the lottery and your first instinct is to spend some of that loot, but you want to be smart about it.
Heck, it doesn't even need to be the lottery, it could be an inheritance, a settlement, or any other sort of windfall.
It may not be in the millions of dollars, but, if you're smart, you can greatly improve your situation.
Have a contingency plan.
You can't always know when a windfall is coming your way, but you can be ready for it.
Make a plan and stick to it.
The first thing you should do is keep the news quiet.
Speaking to a financial adviser and setting up short- and long-term goals is a good next step.
Chill out and let the excitement settle so you can think clearly and stick to your plan.
Don't spend any of the money, yet.
Pay down debt.
Make a list of your debt with payoff amounts and interest rates.
This will help you leverage any amount of money you get to help you in the long run, even if it's in the thousands instead of millions.
Pay down or pay off high interest debt first.
Then pay as much as you can on the next-highest, etc.
This doesn't sound like fun, but when you do this, you pay less in monthly payments giving you more money in the long run.
Mortgages and car payments may not be as important to pay down, unless, of course, you are in arrears, then catch those up first.
Set short- and long-term goals.
How do you want your money to work for you? If you've paid off your debt, except maybe your mortgage or auto payment, and you still have a substantial amount left over, consider putting it to work for you.
A good number of people want to buy things they don't have, or upgrade what they do without thinking of the consequences.
For example, people may purchase a much larger home and not realize that maintenance, utilities, and taxes will also be higher.
A financial adviser can help you manage your money to make it last and making it work for you instead of you being enslaved to it.
Large amounts of money, say $1 million or so, can seem like a lot of money at the time, but over the long-haul, it really isn't much at all.
Certainly not enough to allow you to quit your job and allow you to do what you want to do.
This is the trouble a lot of lottery winners get themselves into.
They will over-spend and soon the pot goes dry and they find themselves deep in debt, much more so than before they won the lottery.
Taxes, taxes, taxes.
Of course, with any windfall, the taxman cometh.
Make sure you take care of your tax obligations.
This actually should be the first thing you take care of.
Again, a financial adviser or tax adviser can help you navigate your way through the tax laws and allow you to keep as much as you can.