Having worked with lottery winners and being recognized as a national expert on sudden wealth, I have financial advice for lottery winners. But first . . . congratulations on your win! As you’ve probably realized, nothing could have prepared you for the rush of emotions and adrenaline. [Read about our Sudden Wealth Lottery Winners Services]
Winning a large lottery has to be one of the most exciting events that can happen to a person. Their day starts like any other but by the time they go to bed their life has forever changed. If you’ve just won you may feel a little anxiety mixed in with the excitement because of the many legal, tax, and financial decisions you have to make right away. We can help.
We are known nationally for our expertise is working with lottery winners—helping them build their team, determining whether it makes sense to take the lump-sum or the annuity, protecting your winnings, minimizing taxes, handling the media, growing the assets, and working through the emotions to help our clients make the best decisions they can so that winning the lottery doesn’t just change their lives, but improves them.
Here is my financial advice for lottery winners:
1. Sign the ticket. Whoever holds the ticket is the winner, so make sure you sign it immediately. Also, it’s a good idea to take a photo and video of yourself with the ticket.
2. Determine whether it is better to take a lump-sum payout or an annual annuity. The majority of lottery winners choose to receive a lump sum payment, but there can be advantages (and disadvantages) in taking the annuity payout. You’ll want your accountant and financial advisor to review both options and discuss the pros and cons of each. The biggest advantage for taking the money over time is that it provides you with a “do over” card, so that even if things go badly the first year, you will have 29 more chances to get it right.
3. Create your power team. At a minimum, you’ll want an attorney, a tax expert such as a CPA, EA, or tax attorney, and a Certified Financial Planner with experience in sudden wealth.
4. Don’t get caught up in the moment. Lottery winners often complain that after winning their lives are turned upside down and that they are thrust into a new life. It’s hard to keep things exactly the same when you get a check for millions of dollars, but at the same time, you don’t want to lose the aspects of your life you now cherish. Step outside the craziness of the situation for a moment and make a list of Who and What you love about your life that you don’t want to change. Money is best when you use it to improve your life, not necessarily change it.
5. Get ready for the lime light. As soon as you claim the prize, the whole world will know your name, so rather than be reactionary, the best approach is to develop a public relations strategy before you claim the prize. Decide what you want to share, when you want to share it, and if you will be your own spokesperson or if you want to have someone else speak on your behalf.
Watch me on Katie Couric provide financial advice for lottery winners…
These five tips are just the beginning. There is much more financial advice for lottery winners. If you’ve won and would like the lottery experts to help you make sense of and make the most of the win, contact us with any questions about how we can help or your personal situation and we’ll respond to you today. [Read about our Sudden Wealth Lottery Winners Services]