From King Midas in ancient Greece to the latest internet millionaire, sudden wealth can bring profound effects and unexpected consequences. For those “lucky” enough to experience sudden wealth, it can be like waking up as a new resident of a completely different country. The language and customs are unknown, and there may be a period of adjustment while learning how to navigate a vastly different situation. Making the transition can be challenging, and early on it’s important to understand the normal range of emotions that can be associated with sudden wealth.
This paper provides helpful guideposts for handling new wealth, regardless of the circumstances. Whether the wealth represents a recent windfall (the immigrant experience) or having control of a large amount of money for the first time (the inheritor’s experience), forethought and planning goes a long way to help ensure the sudden wealth does not suddenly disappear.
- Sudden wealth is not something that happens only to lottery winners. It can happen to entrepreneurs who spent decades building a business, chief executives receiving multimillion dollar dividends or vested options, a person marrying into a family of wealth, the newly divorced, a millennial receiving a trust distribution, or a middle-aged inheritor.
- Sudden money can have a profound effect. It can:
- Bring both joy and pain.
- Enrich us yet cut us off from what is precious.
- Be different than what we expected.
- “Turn up the volume” on underlying issues.
- Once the money is in hand, one key first step is to stop and reflect – not about what to do, but about what to think about.
- Strategies to help manage sudden wealth include:
- Locate your own experience within the continuum from immigration to being a native of wealth.
- Recognize the challenges you will face as you adapt to wealth.
- Respect the chute of emotion, knowing that it will contain twists and turns. Let it teach you about yourself.
- Stay in a decision-free zone as long as needed to develop confidence in your decision making.
- Strong reactions to sudden wealth will gradually dissipate. Trust yourself and the process.