From windfall to wealth: how to make your money last

Receiving a financial windfall, whether through an inheritance, gift from family or prize winnings can fast-track major financial goals and responsibilities. However, without a clear plan, a sudden windfall can easily become a missed opportunity to building long lasting wealth.

As more young people focus on financial independence and long-term wealth creation, young adults are encouraged to view a financial windfall not as spending money, but as a foundation for future financial security.

Akweley Laryea, Head of Retail Banking at First National Bank shared that one of the biggest mistakes young adults make is treating a windfall as an opportunity to immediately upgrade their lifestyle.

“Many young people dream of owning a home, driving a new car or travelling the world. While a financial windfall may make these goals achievable immediately, it is important to first define your financial goals. The decisions made in the first few months can have a significant impact on future financial wellbeing,” adds Akweley as she shares financial considerations to take into account:

• Don’t make major financial decisions immediately: Take time to develop a structured financial plan that considers your short, medium to long term financial needs so that you avoid unnecessary spending.
• Seek professional advice: we encourage young people to avoid making significant financial commitments for at least six to 12 months after receiving a windfall. This provides time to seek advice, gain a full understanding of their financial needs and make decisions that support long-term wealth creation rather than short-term gratification.
• Set clear financial goals: a financial windfall can create significant opportunities, but managing it wisely is important. Young adults should focus on setting clear financial goals, reducing costly debt, building an emergency fund and invest for long-term growth.
• Make informed decisions: young people are also encouraged to avoid rushing into business ventures or investment opportunities. It is advisable to rather take the time to understand these opportunities fully and obtain appropriate advice before committing funds.
• Don’t resign from your job: be cautious of viewing a windfall as a replacement for employment or career growth. A financial windfall should complement and not replace your career ambitions. Continuing to work, building skills and enhancing your earning potential remains one of the most effective ways to preserve and grow wealth over time.
• Giving a gift that creates wealth: Financial windfalls do not always arrive through inheritances or prize winnings. Increasingly, families are looking for meaningful ways to transfer wealth and create financial opportunities for loved ones during important milestones. What if those moments became opportunities to build wealth instead? This is where innovative solutions such as the FNB Investment Gift Card are changing the way people think about gifting. Instead of giving cash that may quickly be spent, families and friends can gift an investment that provides the recipient with an opportunity to start or grow their wealth journey. “Whether it is helping a young graduate take their first step into investing, contributing towards a child’s future, supporting newlyweds as they build their financial future, or celebrating a professional milestone, an investment gift has the potential to create value long after the occasion has passed”. By shifting from consumption-based gifting to investment-based gifting, families can play a meaningful role in building a stronger culture of saving and investing across generations.

Akweley adds that families should proactively prepare younger beneficiaries for future inheritances. We often underestimate the responsibility that comes with inheriting money. Where possible, families should start conversations early and help younger beneficiaries understand the financial responsibilities that may come with managing large amounts of money.

“Receiving a financial windfall is rare. For young people, it can be a powerful opportunity to build wealth, achieve financial freedom and create a stronger financial future, provided it is managed with patience, discipline and the right support,” concludes Akweley.