Did you know that the chances of winning the Powerball or Mega Millions lottery are about 1 in 292 million or 1 in 302 million? Even if the probability of winning the lottery is exceedingly low, plenty of Americans choose to test their luck each day for the chance at winning millions.
However, winning the lottery doesn’t mean being showered immediately in cash. Your life may also be turned upside-down, and not necessarily in positive ways.
With this in mind, read on to learn all about what happens when you win the lottery today!
1. Sign Your Ticket
A lottery ticket is a bearer instrument, meaning that whoever acquires and keeps the ticket gets to collect the winnings. This is the reason why you want to sign your name on the back as soon as possible. If you lose it or someone steals it, they won’t be able to cash it in without facing the consequences.
When you sign your ticket, you may also want to leave some room at the top or bottom in order to include a trust fund name or legal entity. Some people choose to collect the money under these entities in order to keep themselves anonymous.
You’ll also want to keep records of the lottery ticket just to be on the safe side. Keep or scan any receipts as well as the date, time, and retailer you bought the ticket from.
2. Keep It Secret
If you win the lottery, your first instinct may be to celebrate with friends and family. However, we recommend keeping it a secret except for only a trusted few. This is because people from your life may try to take advantage of you and beg for money.
Before the word spreads like wildfire, we recommend setting your social media profiles to private and changing your email address as well as phone number. If you can, you may also want to consider changing your address so that you can continue to live in peace. Acquaintances that you know distantly may come out of the woodwork in order to ask for money.
You may also be hounded by the press, scammers, distant relatives, and more.
3. Find a Lawyer
Winning such a huge amount of money all at once also comes with many downsides, and it’s recommended to hire a lawyer that’s able to help you manage the winnings. Along with making sure you’re free of tax liability, here are a few details that lawyers can help you navigate:
- Protecting your anonymity
- Advising on whether you want to take a lump sum or annuity payment
- Handling frivolous lawsuits
Overall, an experienced lottery lawyer will help make it as seamless an experience as possible. They’ll help you avoid common mistakes that lottery winners are prone to make as well as steer you away from common scams.
4. Annuity vs Lump Sum
When you find a lottery lawyer, they’ll be able to help you decide whether you want yearly payments of your winnings or whether you want to collect everything all at once. Collecting your winnings as a lump sum is advantageous because they’ll be taxed based on the current state and federal taxes. Then, you can spend the remaining money however you like.
On the other hand, collecting an annuity payment yearly may mean that tax rates will be lower. This means you’ll be able to collect more money overall, though it’s not guaranteed.
If you do decide on annuity payment and want cash faster, there are also structured settlements that allow you to collect cash for your future lottery payments. You can learn more about them here.
5. Create Financial Goals
Along with a lottery lawyer, we recommend hiring a wealth manager, financial manager, or accountant as soon as possible. These experts will help you figure out how to invest and save your money so that it will continue to grow and accumulate throughout your life and for future generations.
They’ll also help you create a budget, so you’ll know exactly how much money you can spend each month and each year. Even if you have millions of dollars at your disposal, the costs of purchasing new cars, mansions, boats, and more can add up. With clear financial goals in place, you can enjoy your money for the longterm.
Lastly, remember to pay off all your debts before you start spending. Starting off debt-free with improved credit will open up far more possibilities.
6. Donate to Charity
Last but not least, we recommend choosing charities that you feel passionately about and donating. If you’ve won hundreds of millions of dollars, this is probably far more money than you’ll need in your lifetime. You can impact thousands of lives by donating to reputable charities that will use each dollar to improve lives.
Donating to charities also comes with some financial incentives such as reducing your tax liability.
What Happens When You Win the Lottery: Find Professional Help
If you’ve ever wondered what happens when you win the lottery, it’s not always positive. It’s important to find professionals who will be able to help you keep your anonymity as well as make the best financial choices. Many people feel overwhelmed by the amount of money they win and go on spending sprees that lead to massive amounts of debt.
If you go about it the right way, you’ll be able to invest in your future as well as accumulate wealth for future generations. More importantly, you’ll be able to keep your anonymity and avoid scams.
Ready for more financial tips? Keep reading our blog for more informative articles!