Portugal news - How to invest if you win an unexpected amount of money? A study that includes Portuguese economist Miguel Ferreira was referenced in Financial Times article “How much money do you need to quit your job?” and shows how a financial windfall affects the creation of startups.
A financial windfall can come through various means such as winning the lottery, a profitable investment, a tax break, or an inheritance. However, receiving an unexpected amount of money can lead to spending it all without financial planning rather than investing in a diversified portfolio. And some people wonder how much money do they need to quit their job and how to invest if they win an unexpected amount of money?
A recent study that involved Portuguese economist Miguel Ferreira with Vicente Bermejo, Rafael Zambrana, and Daniel Wolfenzon, has determined how cash windfalls affect entrepreneurship, using evidence from the Spanish Christmas lottery. The study shows that some lucky people suddenly become savvy entrepreneurs who use the money they won at the lottery to create startups, that in turn have a direct impact on the country’s real economy as key findings include increased start-up activity, job creation, and higher wages in winning provinces.
The study has shown that, instead of choosing a life of leisure, some lottery winners have chosen to create a company, leading not only to job creation but also to profitable startups. So, if you win an unexpected amount of money, you could follow the Iberian model and become the founder of a profitable startup.