What would you do if you won the lottery?

It has got to be everybody’s dream. After years of buying lottery tickets, your numbers finally come up!

Let’s face it, the odds are not in your favour. For Euromillions the odds of winning the jackpot are around 1 in 139 million, and the UK Lotto 1 in 45 million. The odds of winning any prize at all are much better (1 in 13 for Euromillions and 1 in 54 for UK Lotto) but when you consider most prizes are only a couple of pounds, you’ll be lucky to win back the cost of your ticket.

But what if you did win a big prize? What would you do?


Spend spend spend?

Over the years there have been many reports of people who have won a large amount of money then blown the lot. The most well known of these is probably Viv Nicholson, a Yorkshire housewife who won over £150,000 on the football pools in 1961. She declared that with her winnings she was going to “spend, spend, spend!”. The story of how she did this, and what happened next, inspired the West End musical Spend Spend Spend. Needless to say, things did not end well.

So. whilst spending lots of money may be the first thing that comes into your mind if you win something, it is wise to take a deep breath before doing so. In fact, if you do come into any amount of money, probably the best thing to do at first is nothing. You need time to let it sink in, and plan what to do next.

And yes of course you will then spend some of it! And why not? How wonderful it would be to treat yourself and your family to some special purchases and experiences. 

But as well as spending some of the money, there are also three other things that you need to consider doing if you have money to spare. They are:

  • Paying off debt
  • Short term savings
  • Longer term investments

Let’s take a brief look at each of these.


Paying off debt

Imagine how it would feel to pay off all your debts? If you do come into any amount of money, this is always a good place to start. Yes it’s tempting to throw caution to the wind and just enjoy spending. But if you can get rid of your debt, you will have additional disposable income every month from now on, as you will no longer be using it to repay debts.

Interest rates for savers are low at the moment, but you may still be paying high rates of interest on credit card and loan repayments. So by making paying off debts a priority, your money will work harder for you, and help you towards the financial freedom you long for.


Short term savings

In our recent article I want to save money but where? we looked at some of the best places for your short term savings. Even though interest rates are currently low, it is a good idea to have some money that is safely tucked away but can be accessed fairly quickly in the event of an unexpected bill or an emergency. 

So take a look at our article to get some ideas as to good places to save money in the short term.


Longer term investments

In our article we also referred to ways you can lock your money away into longer term savings or investments, and potentially earn higher rates of interest. 

Two other longer term uses of your money are pensions and property:


If you have a pension this can be viewed as a long-term investment. If you have either a workplace or private pension you are likely to be able to pay AVCs (Additional Voluntary Contributions) into that pension. You may be able to do this even after you leave your employment. But if you are staying in your job, paying AVCs is likely to have the additional advantage of reducing the amount of tax you pay, because your pension contribution is deducted before tax, leaving you a smaller salary to pay tax on.


If you own a property, an excellent investment is to pay off all or part of your mortgage. Paying off part of your mortgage with a lump sum, or making higher monthly repayments, will reduce not only the amount of mortgage you have left to repay, but also the interest remaining on that amount.

You can use a free online tool such as Money Saving Expert’s Mortgage Overpayment Calculator to see what a big difference a one-off or regular overpayment could make. It could enable you to pay back your mortgage considerably earlier than you had imagined possible.

Another property-related investment option is to either buy a larger home for you and your family or to buy a second home as a Buy-to-Let or holiday property. Property is regarded as a safe investment, so if you have a significant amount of money available, any of these options would be well worth looking into.

So, if you are ever lucky enough to win the lottery or come into a sum of money another way, we hope that the above tips will help you to make the most of every penny.

And if not, then by following the above advice you will be making a good start on beginning to save money and getting your current finances into the best shape possible.

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