The Lotteries, Both Powerball and Mega Millions, hold $596 Million: What to Do If You Win!
The chances that you will end up winning both of the most popular lottery events in the country are pretty slim, considering the winnings odds are only one in around 300 million for each of these jackpots. But in case that you do end up winning some of it, there is a lot of grey area surrounding the process of claiming the winnings to managing all the newly acquired wealth.
Individually, the Powerball lottery currently holds $229 million as its top prize, while the Mega Millions’ top prize stands at an amazing $367 million. So winning either one is bound to change your life.
What to Do If and When You Win
The primary course of action you need to take after you win something at any of the lotteries is to assess the magnitude of the winnings, because the way you deal with it needs to be appropriate. When the winning amount is small, you probably would retrieve all of those winnings into your private bank account and then spend it on purchasing those items which you may have wanted for a very long time.
However, matters become a bit more complicated when the winning amount is so large that it alters the way you live your life. According to Jim Shagawat, who is a certified financial planner and also the president at the Windfall Wealth Advisers located in New Jersey, winning the lottery can be both a good and a bad thing, and which way your experience goes depends entirely on how you deal with your winnings. Just as a heads-up, there are a few common mistakes which you should avoid.
Don’t Share with The World
It’s natural and expected that members of your immediate family would find out about your lottery winnings, and your close group of friends may also come into the loop soon after you find out about your lottery win. However, you need to stop that loop right there and ensure the news does not spread far and wide, attracting disconnected friends and distant relatives to you who would want a piece of the pie.
Claiming your prize in an anonymous fashion is one way of protecting your identity and keeping your win a secret from the public. Also, make sure you defeat the temptation of announcing to the world yourself via social media that you’ve won the lottery. It may do you more harm than good.
Carefully Handle Your Ticket
Generally, it is advised that you place your signature on the winning ticket in order to confirm that it belongs to you, and making several copies of the same would be good in case you somehow ended up losing it.
However, keep in mind that if you are planning to receive your winnings via a trust in order to maintain secrecy as far as your identity is concerned, then having your signature on your ticket can act as a hindrance in that.
Also, every state has different legal practices and the way the deal with lottery winners. While some may allow you to claim your winnings anonymously, either through a trust or individually, others completely forbid anonymous claims.
Be Patient With The Claim
There is a grace period of three to six months which is allowed to all the winners during which they can claim their winnings at any time. Hence, claiming the money immediately after winning it is highly inadvisable as you will have all that money and no idea what to do with it.
The best practice is to first group together a team of experienced professionals pertaining to the field of law, accountancy, and also someone good at financial planning and preferably an insurance consultant as well. If you don’t want to hire so many people, then get only an experienced attorney on board as that would be essential for you to handle all the legalities attached to winning the lottery.
What to Expect at Claim Time
You’d be offered a choice: either claim your lottery winnings in a lump-sum amount or split it up in small batches to be claimed over a number of years, even decades. The amount you receive would be heavily taxed, by as much as 37% of the total winning amount plus other taxes depending upon the state of your residence.
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