However, we also see that according to many statistics, most cases of winning the lottery are with people who are facing difficult circumstances. After winning the lottery for a while, these winners often return to their initial points of poverty, or even worse. Today, we will analyze the reasons why this happens, and in my opinion, the reason is that actually earning money, in this case winning the lottery, is just a small part of the entire financial journey of a person. Specifically, according to my personal analysis, the financial journey of anyone will include about three stages:

• First, we must know how to earn money.
• Second, we must know how to keep money.
• Third, we must know how to make money continue to generate more money for us.

Now I will talk a little deeper about how to earn money for each of these stages.

Knowing how to earn money

The first way to earn money, which is also the most common way, is that we exchange our labor and time for money. This is essentially what we do when we work for a salary, which is the starting point for most of us. However, this is just the first level. The second step in earning money is that we use the time and labor of others to help us create more money. Specifically, this is the case where we delegate some of the tasks we are doing to others, which is essentially paying assistants or employees to help us do more work.

However, even with this method, if we want to earn more money, we need to have more labor, more helpers. This means that the amount of money we can earn will always be limited by the workforce we have. The more labor we have, the more management it requires, which in turn takes up our time and effort. Therefore, to achieve complete freedom, we must move to a third level, which is to create money-making machines. At this point, I will give a very simple example for you to easily visualize: imagine that you have 100 rental houses, and to manage these 100 houses, you will have a team of about 10 people. These 10 people will work with a well-established process to avoid losses, and more importantly, you do not need to be present for this system to operate effectively. This is the moment when you do not need to do anything anymore. But that money-making machine is still there, generating money for you day and night; that is the ultimate level of earning money.

How to keep money

We must know how to keep money, and from my perspective, earning money is already difficult, but keeping money is even harder, especially for those who have a lot of money in hand. We tend to spend on consumer goods or extravagant entertainment, which automatically upgrades our lifestyle along with our income. For example, when our income was 10 million a month, we would ride a motorbike after work, sit on the sidewalk with a few colleagues to drink beer, and normally every morning we would stop for coffee and breakfast. The expenses would be close to our salary, resulting in spending all our salary each month, whatever we earn, we spend.

But then one day, when our income rises to 100 million a month, we start to upgrade. Instead of eating at regular restaurants, we eat at upscale places, and we switch from a motorbike to a car, which brings a series of other expenses. Friends also start to socialize with wealthier people, and those people organize more expensive trips. The result is that we return to the situation of spending whatever we earn, and further down the line, suppose we now earn 1 billion a month, we will also follow the same trend, pulling in more luxurious and high-end relationships, driving more expensive cars, and even thinking about things like yachts or supercars, and when traveling, we must stay in five-star or six-star hotels. The result is still that we spend whatever we earn.

This spending whatever we earn is almost a natural instinct for all of us. If we do not have a method to control it and let it develop naturally, it is almost certain that anyone among us will always be in a situation where spending increases along with income, and the result will always be that we spend whatever we earn.

In the series on financial freedom, I have shared with you about how to build spending principles. Specifically, we need to reverse the process of spending and saving. Instead of spending whatever we earn and then saving whatever is left at the end of the month, we will reverse that process. We will calculate our fixed expenses, and when money comes in, we immediately set aside the savings, and only spend what is left. This means that instead of spending whatever is left, we save first, and then spend what is left. This is just one skill among many other skills for keeping money. Having these skills ensures that the money in our pockets will always be safe.

Making money generate more money

However, there is still one important step: we must find a way for the money we keep to continue generating more money for us. This is where investment skills come in, a very broad topic. There are countless ways to invest, from the simplest method of saving to more complex investments in real estate, stocks, or business ventures. Each of these investment activities requires us to have numerous smaller skills. Each form of investment comes with many skills, and we need to have these investment skills to ensure that not only do we keep our money, but the money in our pockets will also grow more and more.

Are we ready to be rich?

Many people who have won the lottery say that winning the lottery actually makes them more miserable, and they wish they had never won. After analyzing the financial management skills above, you can see that the reason is quite clear: these lottery winners often lack any skills in the range of skills we just listed. Most cases of winning the lottery are still at the first level of earning money, specifically, they are still exchanging their labor and time for money.

They have not progressed to the second or third steps of earning money. This means that even at the first stage of earning money, they still lack the advanced skills in this initial stage. As for the second stage, which is keeping money, their financial management skills are very limited or even nonexistent. Obviously, at the investment stage, they have no skills at all. With very few or no skills in earning money, managing money, and mastering money, suddenly they find themselves with a large sum of money. With such a foundation, it is like suddenly having a high-rise building without any foundation. They will think: now with such a large amount of money, almost infinite, why not spend freely to make up for the hard days before? From there, they start to indulge in shopping, diving into extravagant parties, spending wastefully, giving money to anyone they like, regardless of whether they are close or not. As a result of such spending habits, they will attract more people around them who come only for the money, exploiting them, and this cycle will pull them deeper and deeper.

Yet now suddenly they have a large sum of money in their hands, it is obvious that with such a foundation, it's like they suddenly have a high-rise building, but they have no foundation at all. At that time, they will think: now with such a huge amount of money, almost infinite, why should they not spend freely to make up for the hard days before? From there, they begin to indulge in shopping, dive into partying activities, spend extravagantly, and give money to anyone they like, regardless of whether they are familiar or not. And from such spending habits, one day, more and more people will come to them just for the money, taking advantage of them, and that spiral will pull them down deeper and deeper.

This means that at this stage, from a skills perspective, they no longer have any skills left; they only eat, spend, and live off the money they won. As the saying goes, "spending like that will lead to disaster," and it will definitely lead to disaster. The money will gradually decrease, and it will not be replenished, especially with their increasingly rapid spending pace. At some point, the money will run out, and when that money is gone, the tragedy is that they still cannot stop immediately; they still have the inertia of that wasteful spending. So they start borrowing money to maintain that lifestyle, and gradually they cross into the negative, the negative number will keep increasing, meaning their debt will keep rising. Eventually, when they reach a dead end, they will have to defer their debts, even escape from debts, or start gambling or seeking quick wealth to try to escape from those debts. The outcome of these actions is something you can easily guess; that is why, for lottery winners after a while, it is not just that they return to being broke, but in most cases, they end up worse than their starting point before winning the lottery.