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business Thursday 24 March 2022
‘Where’d the money go?’ How to handle a windfall

By HAL M. BUNDRICK to spending it wisely.
of NerdWallet However, sudden un-
Tax refunds. Child tax cred- earned money — such as
its. COVID-19 relief checks. winning the lottery or get-
We dream of the next un- ting an inheritance — may
expected bundle of mon- trigger a different reaction.
ey that lands in our lap. Because it wasn’t worked
Perhaps it’s a few hundred for, he says in many cases
dollars earned from a ga- it’s spent recklessly.
rage sale, maybe even “Money is very emotional. It
more from a job bonus — feels good in the short run
or hundreds of thousands to buy things you haven’t
from a winning lottery ticket had or always wanted.”
or inheritance. Our minds An example: Shortreed ad-
race with the possibilities. vised some members of a
A windfall can either be a group of lottery winners.
lifeline to short-term finan- “The ones that I dealt with
cial relief or a stepping put money aside for their
stone to long-term finan- kids’ college. The other
cial stability. But because ones were buying all kinds
of our inherent money per- of fun stuff. My clients got
sonality, we may not make their kids through college
the best use of the surprise and had peace of mind.”
cash. This Wednesday, June 6, 2018, file photo shows U.S. currently in New York. HOW TO HANDLE EXTRA
MONEY DECISIONS AMID A Associated Press MONEY
CRISIS “When people with those you handle money on a at that personality type Debt can be erased or re-
A 2021 study published in characteristics enter crisis day-to-day basis. and have a general sense duced with a windfall. But
Journal of Family and Eco- environments, they likely Thomas Shortreed, a be- of how you probably think many times, we later re-
nomic Issues found that have built some resilience havioral financial advisor and process decisions peat the same spending
emotions tied to money in their financial situations in Cortland, Ohio, uses a about money.” mistakes, failing to break
can dictate whether we such as an emergency fund questionnaire to determine Personality types include recurring debt habits.
decide to spend or save a or having investments,” a client’s money personal- Money Master, Optimist, When a windfall is received,
windfall — even in a crisis Asebedo says. “So they ity. It provides insight into Perfectionist, Producer and Shortreed suggests:
environment. might use their windfall on our relationship with finan- Safety Player. You can find — Pausing and reflecting
The research examined things like ‘wants’ or further cial matters. Questions in- similar money personality on the good and bad mon-
how recipients of COV- saving and investing be- clude: tools online. ey decisions of your past.
ID-19 relief checks used the cause that’s what they’re — How emotional about THE DIFFERENCE BETWEEN — Focusing on intermedi-
money. People with exist- wired to do to some de- money are you? EARNED AND UNEARNED ate to long-term goals, not
ing financial resources who gree.” Those who needed — Do you prefer to save or WINDFALLS short-term wants.
were previously inclined to to make ends meet during spend? Your mind can also react in — Considering your core
save and invest did just that the pandemic mostly used — Are you reflective about different ways to the type values (family, security, au-
with the COVID-19 windfall, the money to pay off debt, your decisions? of windfall you receive. tonomy, etc.).
says Sarah D. Asebedo, Asebedo adds. — How trusting are you? In many cases, earned — Reviewing your money
lead author of the study. DEFINING YOUR MONEY — How involved are you in windfalls, such as an em- personality type.
Asebedo holds a doctor- PERSONALITY financial decisions? ployment bonus, trigger — Asking a partner to help
ate in financial planning How you handle a windfall, Based on how you answer more long-term focus on hold you accountable.
and is an assistant professor whether it’s a federal stimu- the questions, your per- how the money is spent, The key to making the most
at Texas Tech University in lus check or an inheritance, sonality type is identified, Shortreed says. There is of- of a windfall: Take some
Lubbock, Texas. is largely tied to the way Shortreed says. “I can look ten a little more attention time.q

Wall Street profits drive average

bonuses to a record $258K

NEW YORK (AP) — Soar- DiNapoli cited pretax prof- cal years, according to Di-
ing profits on Wall Street its through the first three Napoli.
helped drive up the aver- quarters of 2021 for broker/ The comptroller said that
age bonus paid to employ- dealer operations on the recent events could drive
ees in New York City’s se- New York Stock Exchange, down near-term profitabil-
curities industry to a record which increased by 19.6% ity and bonus payments.
$257,500 for last year, the to $44.9 billion. “Markets are turbulent as
state comptroller reported The securities industry ac- other sectors’ recovery re-
Wednesday. counts for one-fifth of pri- mains sluggish and uneven,
The average securities in- vate sector wages in New and Russia wages an inex-
dustry bonus was 20% high- York City, despite compris- cusable war on Ukraine’s
er than 2020 and came out ing 5% of private sector freedom,” DiNapoli said
of a bonus pool that grew employment. The industry in a prepared statement. Pedestrians walk past the New York Stock Exchange, Jan. 24,
to $45 billion, according also accounted for 18% of “In New York, we won’t 2022, in New York. Associated Press
to annual estimates from state tax collections and get back to our pre-Covid
state Comptroller Thomas 7% of city tax collections in economic strength un- more sectors — retail, tour- and others — enjoy similar
DiNapoli. the governments’ 2021 fis- til more New Yorkers and ism, construction, the arts success.”q