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 Financial Happenings Blog 
Wednesday, July 01 2009
In a recent article published in Alan Kohler's Eureka Report, financial education consultant Scott Francis considers the plan that a $50 million lotto winner might proceed with their winnings - and it might also apply to others who happen on an unexpected lump-sum payment.

Scott suggests the following ideas:
1: Setting aside $2 million in cash for the new home/car and any other initial costs (living costs for a while, travel costs and so on) while you structure your overall position.

2: Investing $10 million a year in the winner's own name as a portfolio of cash, fixed interest investments, shares and property assets to provide the winner with an income of well over $200,000 a year, increasing with inflation.

3: Set aside $2 million to provide for investments into superannuation over the next 10-15 years as a future source of wealth.

4: Contribute $10 million to a charitable trust, and keep $2 million in a charitable portfolio outside the trust. Each year the income from the charitable trust (likely to be $400,000 or so) has to be donated to registered charities. The other portfolio ($2 million) is likely to generate income of $60,000 a year after tax, and can be used for giving to non-charitable causes (such as a family member).

5: Contribute the remainder to a family trust (a cool $26 million). The income from this trust can be distributed each year for any of the strategies listed above.

6: Get yourself a very good lawyer.

7: Spend some time doing your will, and cancel your life insurance. With $50 million you don't need to be paying money every month for a $1 million life insurance policy. If you die your family will be fine financially. A will that reflects your wishes is crucial. This should be continually updated as your circumstances change.

To take a look at the full article please click on the following link - A lotto winner's handbook
Posted by: AT 08:56 pm   |  Permalink   |  Email
Scott Francis' articles in the Eureka Report 
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