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It’s so much fun to get a financial boost. It can relieve stress when you feel like you are drowning in bills and barely making it from paycheck to paycheck. It can provide funds to buy that special something or to do that project you’ve wanted to get to. 

Spending it will still be exciting in ten minutes or ten days. We must let our emotions settle and make a plan that brings us happiness today and satisfaction when considering our decisions in six months. If we want to make our goals and obligations part of this event, we must get intentional.

Let’s look at specific strategies and challenges affecting our goals and objectives. The outcome we want is available if we choose it.

To Do or Not To

Perhaps the first thing we should focus on is don’t. Don’t jump on Amazon, run to your local Walmart, Target, or shopping option. Inflation will not likely destroy the windfall because we slow down to optimize our spending plans.

So, the first “do” target is thinking things through. When a windfall hits, it shatters our sense of reality. Our productive planning thoughts get pushed to the back. Everything we have said no to month after month and sometimes for years suddenly volley for our attention. The excitement of ‘what if’ and all the options screaming, “PICK ME!” raises our anxiety slightly. Anxiety causes us to feel more and more anxious. You would think not spending it all right now was a form of neglect.

The opposite response is also possible. We can become afraid of spending our money in some way that will later drive a deep sense of regret. This opportunity doesn’t come around every day, not even every week, every month, or for big windfalls, not every year. If our budgeting is stable, it is okay to take some of what came in to enjoy! If we just hold onto the money and do nothing for long, we are thinking with the mindset of a miser. This windfall is not scarcity; it is surplus.

The first part of the thinking process is to get grounded in reality again. The windfall has fractured the familiar boundaries for anxious spenders and fearful misers alike. Perhaps you are like us; you feel some of both emotions running through your mind. It’s like watching a pair of two-year-olds running around, full of energy, and just watching them wear us out. This is why we need to get ourselves re-grounded in reality.

First, the persistent reality

The first thing to remember when receiving an unexpected financial surplus is our established values and objectives. What existed in the past that we want to remain unchanged? It is easy to lose sight of what is truly important to us when there is a large temporary or lasting financial bump. Money can go to our heads, and we can neglect people and meaningful relationships. It’s easy to become self-absorbed, or rather money-absorbed. So, in all your excitement, remember to be thoughtful of others. Remember to include those closest to you in your plans for using this new money. Treat them well if you want those important values and relationships to persist beyond the money.

Second, Present Reality

Remember the here and now before we move beyond the past to the future. If we never slow down and live in the moment, then planning for the future will turn into future planning for the future. In life, we need to dream, but we also need to live. Resources can be used for both present and future considerations. There may be exceptions where all the resource finances go to things in the present or future.

There are unique challenges with spending in the present. The time between the idea and the purchase should include space for thinking. Some suggestions say twenty-four hours, but the advice of a wise, non-judgmental friend may be better as a guide to how much space is suitable for your situation.

Third, Future Reality

Now we can ask the other questions. Could some of these resources be used to get a month ahead, or two, or even three in our budget? Could some of this go toward an emergency fund? Is there a sinking fund we could accelerate with these resources? This could be an opportunity to get traction on our goals. Reducing debt load or completing sinking funds reduces our residual expense load and leaves us with a better surplus moving forward.

Have you heard about compound interest? Investing in your retirement accounts is also a win here. So many of us, when we are young, look at what we need for retirement and think our little investment is so small it doesn’t move the needle. It does. Currently, we can invest seven thousand in a ROTH account per year, and when we take the money out at retirement, there will be no taxes on those gains.

Putting Reality to Use

Reality embraces today while considering tomorrow. When we know if catching up is needed, what opportunities are present, and what areas we could influence for tomorrow, we have all the information to consider related to our budget. This doesn’t mean any money needs to go to the budget. It just means we understood our choices with clarity.

Pick Me Options

Any win is a win. If we forget something we could have done, we can plan better for the future by making a stored wish list. Missing out on a win isn’t missing out. If the choice is difficult, create a tradeoff list for each item. What will the item cost immediately and over time?

When we buy a large-screen television and a matching sound system, we can predict a loss of time watching our new entertainment option. If we buy a new car, we will pay more in insurance. If the vehicle gets better mileage, we will be saving operating costs. If we buy a new cabinet for the kitchen, there will also be costs for countertops, backsplash, and labor. We need to figure out the total cost upfront.

Don’t repeat known mistakes.

Financial gain, especially windfalls, can bring disappointment if we are not careful. It can even leave us with less than we had before. How is this possible? Our response to financial gain includes emotions. Extra money means unexpected options, and that gives an emotional rush. The emotional surge can influence us to act without thinking things through. 

We once knew a man who won the lottery. It was well over a million dollars. He was counseled to take a small portion to enjoy and then invest the rest. The goal was to live off the profits of investing rather than burn through the sudden incredible surplus of money. Instead, he rationalized he didn’t need his job anymore. That much money made him feel he could live and spend freely. He lived lavishly, treating himself and his family to all they desired. I don’t know all the details, but this man eventually ended up in financial ruin. What makes this story even sadder is that his children were also affected by this free-spending mindset. As they became adults, they continued to spend, diving deeper and deeper into debt long after the winnings were gone. Generations of a family now struggle for stability, and they have become strangers to security financially and emotionally. And it’s not just this man; it is a well-known fact that those who receive gambling winnings have a history of financial woes. 

Not all gains are unmerited, but all gains can challenge our rational thinking. Whether large or small, what is the correct way to handle financial gain? Our mindsets will be the source of stability or blind spots. We must realize that no matter how much it may seem, the acquisition does not bring true, lasting happiness. The reason we always want something new is because the last thing we wanted didn’t bring us long-term satisfaction. When we fall for this lie, we are practicing self-deception. 

Gratitude is more than saying thanks.

First, take a moment to express gratitude. If your windfall was from a relative who passed, realize that they worked hard to earn the money you now possess. They invested and probably sacrificed to build this wealth. They thought of you and made a plan to guarantee that you would benefit from their work. Be thankful for that and remember their sacrifice. 

If your financial increase results from a new job, a promotion, or a pay raise at work, no doubt you worked hard to earn the increase. But remember the person who worked hard to build the company that gave you that opportunity.

So yes, positive financial change is, well, positive. It can be fun. Remember that if we want to maximize this blessing, we need a plan that works with our short- and long-term objectives.

The following article will look at walking through negative financial changes. These changes can be daunting. They often happen during emotional and physical stress, making navigating them even more challenging. We will consider mindsets and positive steps we can take to overcome these challenges.

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