New York, NY (ContentDesk) December 28, 2004 — Receiving a windfall is certainly a nice dilemma to have, but you’re wise to recognize that pitfalls can lurk behind your good news. No doubt you’re familiar with the stories of lottery winners reducing their jackpots from millions of dollars to zero in just a few years. It’s always useful to see how others react to similar situations. We recently asked members of the Armchair Millionaire community who had received windfalls to tell us how they reacted.

I paid off credit cards and other personal debt, set aside cash reserves, bought a two-year old Corolla, bought a computer, purchased health insurance, leased a nice apartment near the ocean, bought some badly needed furniture and invested most of the money in balanced mutual funds.” –TTT”I spent too much of my inheritance before I calmed down.

Most of the windfalls that people receive–whether they’re from an inheritance, retirement buyout, lawsuit settlement or even the lottery–are not enough to propel them to the ranks of the rich and famous. This makes it critical for you to not abruptly upscale your lifestyle to an unsustainable level. This is precisely the mistake made by all those lotto winners who end up in bankruptcy.But a windfall can do some very important things for you. It can enable you to reach your most important financial goals faster. It may put some goals within reach that before were only dreams.

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