Definition of a windfall (Google): a piece of unexpected good fortune, typically one that involves receiving a large amount of money.
Many people play the lottery or engage in some other form of a ‘get rich scheme’, hoping and expecting to get millions and never have to work again. Although you’re 6 times more likely to get struck by lightning than win the lotto, smaller windfalls happen more regularly and should be treated with the same appreciation as you would larger sums.
Here are five things to do regardless of whether you come up on $30 or $3,000,000,000:
1) Nothing. If you receive more than $10,000 - especially if it’s the result of a traumatic experience - sit on it for at least 6 months and do nothing other than park it in a simple savings account. You don’t want to act irrationally and spend every dime, then wake up one day and realize all your money is gone and you have nothing to show for it. Do your best to forget it exists for a little while, and allow your sanity to catch up with the rest of you.
2) Save at least 20%. If you receive anything more than $100, put at least 20% of it away in an emergency fund. You may think the amount is too small to move the needle, but with savings, everything moves the needle. Besides, you still have 80% to do other things.
3) Donate at least 20%. You just received an unexpected windfall, which means this is found/unallocated money. There is invariably someone who needs a windfall worse than you - find one of them and be a blessing.
4) Take care of you. I’m sure there’s at least one thing you need to do with this money that will make your life better in the long run. Examples include paying down debt, handling an overdue car or home repair or even buying healthier food from the grocery store. Spend 40% on that.
5) Get it in. Spend the remaining on whatever you want, as long as it’s something that will make you feel good today. Savor and enjoy - you’ve earned it.
And so it is.