Prepare to be Rich

I recently read an article about a trucker in the Midwest who, along with his wife of many years, had won a Powerball lottery worth over $30 million. When asked by reporters what they were going to do with the money, the couple replied "pay off debts, help some family and friends who are struggling, look for a new house, and buy a new truck." The lucky trucker than went on to explain that he had no intention of retiring to a life of leisure, and that he needed a new truck because his old truck had recently expired after serving him well for over 2 million miles.

We have all heard the story about the friend of a friend who has won a lottery, spent it all in few years, and then ended up worse off than they were before the winnings. The problem, I believe, is a lack of understanding of the responsibility of money.

When you've never had any responsibility before, why should you be expected to be responsible now? I'm not saying our lucky trucker is not responsible, I am saying that he has never had to be responsible for managing a fortune of any size, and has no idea what he is in for. It could be compared with becoming parent for the first time, only you didn't have 9 months to prepare. If he is going to continue to work because he'll get bored fishing and playing golf everyday, he isn't taking into account his new responsibilities to manage his investments, or to at least pay very close attention to the people he hires to manage his new money. He now has the great responsibility to oversee and to make decisions that could make him and his descendants very comfortable, but it will not happen automatically. He needs to begin a long process of educating himself about options, and carefully choosing his advisers. This should be a full time job. In terms of money, he has never been a parent before.

For the rest of use who are still diligently building our fortunes, it is important for us to continue to build our knowledge base as well, and to stay informed about new types of investment options. We have the time to prepare for our future responsibilities, and should be at the very least reading the business section of our newspaper or favorite website. There is a direct correlation between how well we prepare now, and how much responsibility we will have in the future. Other options include watching business news shows, or taking a basic business or accounting class online or at a community college. It is only through this regular preparation that we can be expected to truly gain a working knowledge finance.