Most money worries stem from not having enough of the stuff, but spare a thought for those struggling to find peace of mind because they have too much cash.
While at this time of year the too-rich are unlikely to figure highly in the sympathy stakes, dramatic action taken by the likes of British multi-millionaire media mogul Chris Evans offers food for thought to those of us bemoaning our financial shortcomings. Evans has been grabbing the headlines with his latest enterprise -- a street market stall stocked full of possessions amassed over the years to fill his homes across the globe.
ILLUSTRATION: JUNE HSU
Rather than guaranteeing happiness, great wealth appears to have bought the star a sense of confusion and emptiness. He apparently told reporters checking out the wares in London's Camden Market: "Nobody teaches you how to be wealthy and materialism has not bought me happiness. I had nine houses, which is a bit repugnant, don't you think?"
Evans is seemingly not alone and psychologists have identified the condition of "affluenza" as a malaise affecting some who become rapidly wealthy or tire of their riches. Symptoms include materialism, but also shame, guilt and a sense of disorientation.
Financial consultant Matt Pitcher deals with several very wealthy clients, some of whom have built up their wealth over a short time, and recognizes that many share a similar uneasy relationship with their affluence.
"Their finances can very quickly become a mess," he says. "They don't know where half of their money goes, they have cash building up in inappropriate places -- such as their current account -- and have no handle on how much they have and what that means. Many become very insecure over their cash and some actually end up worrying they don't have enough money." In short, Pitcher argues, great wealth can cause more problems than it solves.
Arguably, the most extreme cases of wealth-shock and subsequent affluenza might be found among lottery winners who can be earning minimum wage on Saturday night and find themselves multi-millionaires by Sunday morning. Yet this affects only a tiny fraction of individuals. Far more people find themselves suddenly very wealthy either because of professional success or, increasingly, substantial divorce settlements. How can they enjoy their money and avoid getting dragged into a vortex of guilt and/or financial chaos?
Dot Renshaw deals with British lottery winners every week in her role as head of player services at Camelot, the company that runs the UK's Lotto, and she says that winners experience a range of emotions: "Quite a lot of people don't even want to hold their ticket, realizing that winning the cash can bring responsibilities.
"Everyone goes through a curve of getting used to their win: some hit the ground running, while for others it might take up to a year for it to sink in. Many winners experience guilt, wondering why fate chose them to receive the prize and not someone else."
One of the key messages communicated to British lottery winners is not to rush into major decisions: "It might be tempting to run out and buy a new house, for example, but we advise people to consider the impact on their lives and that what they want then might not be what they want in six months" time," says Renshaw.
Simon Davis, senior investment consultant at BDO Stoy Hayward, says: "If you build up wealth rather quickly, don't shoot for the stars straight away. Think about what you want and what you need and start to prioritize.
"One of the first things many people should do is think about paying off their credit cards and mortgage debt. After that, many people's thoughts turn to their family and they will immediately worry about how much to give, which people they are going to offend and what their families expect."
Pitcher says: "One of the biggest emotional problems the very wealthy can feel is that they are leaving behind family and friends.
"There is no right answer to the question of how much to give to family and friends. The important thing is to make these decisions in a considered way, and only after individuals understand exactly what they can afford to give."
Taking time to incorporate new wealth into your life and that of your family will also help minimize the sense of disconnection that those blighted by affluenza may experience. British lottery winners have access to a panel of independent financial and legal advisers to help them with the major financial decisions they are likely to face.
If you become rich, getting the right kind of professional advice will be crucial to enjoying and maintaining your wealth.
"We often find that when people become wealthy, all their family and friends become instant financial advisers," warns Pitcher.
Davis says you will need three types of adviser: "An accountant who can structure your affairs tax efficiently; an independent financial adviser who will be able to guide you about the structure of your portfolio including cash, property, equities and any more esoteric investments; and a lawyer to draft your will and help you make gifts in the most tax-efficient way."
Pitcher warns that many of those who acquired their fortunes rapidly are often faced with large and unexpected tax bills unless they take guidance early.
Organizing a will is likely to provide the newly rich with a sense of security and can allow them to set up trusts for loved ones.
Trusts help shelter cash from tax, as well as establish checks to ensure that after your death your relatives do not squander the wealth you worked hard to protect.
One of the least complicated and most laudable ways to alleviate the sense of guilt and awkwardness that new affluence can bring is to start donating more to charity.
Beth Breeze, deputy director of the UK's Institute for Philanthropy, says: "Giving to charity, particularly one which benefits your area can create a sense of connectedness and a feeling of being part of something."
Davis suggests that some individuals might consider establishing their own charitable trust, as any cash held in it will be considered outside your estate for inheritance tax purposes.
Breeze also suggests looking into your past and thinking more broadly about which charities you may have had contact with for inspiration about where to donate: "Some people think they have never benefited from any charities, but they may have been a Girl Guide, for example, or have been to lots of sporting and music events where your local ambulance service were working.
How to be wealthy and wise
- If you get rich quick, don't write your resignation letter or put your home on the market without giving it serious thought. Take your time and resist the temptation to make rash, life-changing decisions the moment you get wealthy.
- Paying off debts is likely to bring immediate peace of mind.
- Don't take investment advice from your family; seek professional independent legal and financial advice.
- Give cash to friends and family, but only after you have worked out how much you can realistically afford.
- If you don't yet give to charity, do so. Many charities employ fundraisers who are dedicated to liaising with major gift-givers who will be able to help you to donate in the most mutually satisfactory way.
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