Why You Shouldn’t Treat Making Money Like Winning the Lottery

Dec. 16, 2010 - PRLog -- After going through a rather elaborate story about how he discovered this new plan, he told me, “You know, once this comes together, it will be like I’ve won the lottery.” Now, he was very excited about his new moneymaking plans and was in a rush to meet with someone he hoped to do business with in the future. So, I wished him all the best, as he went on his way.
For some reason I can’t explain, that phrase “like I’ve won the lottery” really started to bother me. While getting a one-time cash windfall of millions of dollars certainly would be great, I don’t believe this is how anyone should consider a business venture.
Let me explain…
It’s a fact that many people who win the lottery end up wasting their winnings on frivolous luxuries and, sooner or later, they end up back where they started. How could someone waste all of that money, especially when it comes to millions of dollars?
Well, the simple fact is that people who come into a lot of money at once rarely know how to manage that money and make it last. This was part of the reason that they didn’t have much money to start with and, unless they get some assistance with managing all this new money, they are bound to simply spend like they did before winning.
Here’s why that simple phrase “like winning the lottery” bothers me. If you treat making money like many people treat their lottery winnings, well, that money is not going to last.
Just take a look at some of the richest investors in the world. Let’s take someone like Warren Buffett. He makes his incredible fortune not by hoping for one massive cash windfall, but by pacing his investments. He puts his money in things he feels have a lower risk and he sticks with them, year after year.
My advice then is: when you’re searching out your own moneymaking ventures, really consider for how long this opportunity has the potential to make money.
While landing a lump sum of money can certainly feel like a godsend, I, for one, wouldn’t count on it solving all your problems. Consider this: money that comes in year after year can also be money that lasts.
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