Who hasn’t dreamed of winning the lottery? I’m sure everyone has fantasized about what they would do with their winnings at some point in their life. Whether you buy a baseball team, mansion, yacht, invest the money, give it to friends and family or a combination of all there are practicalities to think about when you win. The current Mega Millions drawing is now at $640 Million and the lucky winner or winners will have a lot to think about. So if you have the winning ticket, jump for joy, yell, and freak out, but then calm down, catch your breath and think before you act. A lottery win is meant to change your life, but unfortunately for some it changes things for the worse. There have been too many stories of winners who have lost their fortunes due to bad planning, legal issues, drugs, scams, robbery, even murder and suicide. Don’t be that person, instead take some precautionary steps and enjoy your winnings. Here are some tips to help you navigate winning the lottery.
1. Document, Document, Document!!
First thing you should do when you realize that you have all the winning numbers is make multiple photo copies of the ticket. Take a picture of yourself with the winning ticket. Then get a safety deposit box and store copies of the picture and copies of the winning ticket. There will be false lotto winner claims and you want to be sure to protect yourself and your ticket. Also, don’t forget to sign the winning ticket!
2. Don’t Tell Anyone
I know, I know it’s really hard to keep it to yourself. But think about all the family and friends that will be crawling out of every crevice wanting to “help” you figure out what to do with that money. There will be time to give money to family and friends later. You need time to think about whether or not to take a lump sum or collect payments over multiple years. Also, it can be very overwhelming thinking about how much your life will change with your new found financial freedom and you want the space to make choices that are right for you! If you need to tell someone and or you need advice on your winnings, choose someone you have trusted all your life.
3. Hire A Lawyer
A lawyer will help you set up a trust to receive you lotto winnings, so you can stay anonymous. You may not be able to stay completely anonymous since you will have to redeem your winnings and the lotto retailer and state authorities will most likely want to take a picture if you and your winning check.
Lump Sum or Annuity Payments
Right now the odds of winning the $640 Mega Millions jackpot is: 1 in 176 million. But hey ya never know! Even if you win the lotto, remember you will only get about half of it because the other half will go to taxes. So how do you choose whether to take the lump sum or collect annuity payments for the next 26 years? Some people want their money right away because they think they can invest it and make more money. How can you trust yourself not to spend a large portion or it? And how can you be sure you will invest it appropriately? Sometimes it’s more prudent to take annuity payments, to ensure the money lasts longer.
Consider the story of Jack Whitaker. He won $314.9 million in the powerball lottery in 2002. He went for the lump sum cash payout of $170 Million, after taxes he ended up with $114 million. Sounds like a lot of money right? Well after some high-profile brushes with the law and large cash robberies, Whitaker lost most of the money. He was dubbed by the Lottery Post as “the un-luckiest lottery winner ever”.