Welcome Guest
Log In | Register )
The time is now 10:08 am
You last visited September 2, 2014, 9:59 am
All times shown are
Eastern Time (GMT-5:00)

I won! Now what?

Topic closed. 10 replies. Last post 2 years ago by shyguitar.

Page 1 of 1
PrintE-mailLink
Avatar
New Member
Chattanooga
United States
Member #139309
February 19, 2013
1 Posts
Offline
Posted: February 19, 2013, 2:10 am - IP Logged

I won 1,000,000 and was reading on the back of the scratch off that anything between 1 mil & 3 mil is paid over 25 years... I thought there was a choice? Any advice?

    CajunWin4's avatar - Lottery-031.jpg
    Atchafalaya Basin
    United States
    Member #90218
    April 24, 2010
    10480 Posts
    Offline
    Posted: February 19, 2013, 2:20 am - IP Logged

    I won 1,000,000 and was reading on the back of the scratch off that anything between 1 mil & 3 mil is paid over 25 years... I thought there was a choice? Any advice?

    Before Claiming Your Prize

    Laying a good foundation is key to making the most of your good fortune.  Before you rush out to claim your winnings, address the following items  first:

    1. Protect That Ticket and Take Your Time First of all,  protect your winning lottery ticket. Make paper copies, store digital copies,  invest in a home safe or take the ticket to the bank to store it in a safe  deposit box.

    Once you have your ticket secured, take your time to contact the lottery  authorities. This is for several reasons, but primarily to allow the media  hoopla of a big winner to die down and to give yourself time to  breathe and plan for your soon-to-be new life. Most lotteries give winners up to  180 or 365 days to claim their prize, so taking a week off before claiming yours  can do a lot for your mental state.

    2. Don’t Quit Your Job Just Yet It’s what you have always  dreamed of: quitting your job to retire to the islands with a cold tropical  drink, right? But don’t make that decision too fast. You have financial planning  to address and you want to be sure you didn’t mistake the numbers or the date on  your “winning” lottery ticket.

    Just remember to keep your good fortune quiet at work too. A silent smile is  all you need. Otherwise, word could get out before you’re ready and your boss  may start looking for someone to replace you.

    3. Hire Professionals You probably aren’t a tax attorney,  a family planning attorney, or a licensed accountant. When you win a lottery  jackpot, you need to surround yourself with professionals. Hire yourself a good  attorney who is well-versed in financial issues, as well as a solid fee-based financial  advisor and a CPA.

    You are going to need them to help you make the best decisions for your  future. Moreover, if you feel uncomfortable about any advice you receive, get a  second opinion. You can afford it.

    4. Change Your Address and Go Unlisted Once word gets out  that you’ve won millions, you are going to hear from a lot of people with their  hands out. Charities, causes, friends, long-lost family members, work  acquaintances, investment advisors, you name it – you will hear from them  all.

    Before claiming your money, change your phone number to a new, unlisted one  and get a post office box for your mail. This will make it harder for some of  these people to find you.

     

    When Claiming Your Prize

    You can receive your lottery winnings either as a “lump-sum” or as an annual  payment spread out over 20 to 30 years. Lottery players used to have to choose  between lump sum or long-term payments before paying for their ticket, but a law  in 1998 changed it so you can select after you win. There are pros and cons to  both choices, so consider each option carefully.

    Taking the Lump Sum Payment

    When you take a lump sum payout, you won’t actually receive the full jackpot  amount. The advertised winning jackpot amount is based on the lottery paying you  through an annuity  over 20 or 30 years and not all at once.

    So when you take the lump sum, they pay you the current cash value of the  jackpot, which is much less than each annual payment added up. More often than  not, this reduced amount equals about half of whatever the winning jackpot  amount was. But that doesn’t mean the lump sum payment shortchanges you.

    There are other significant pros and cons as well:

    Advantages

    • The money could be worth a lot more than the initial payout if prudently  invested.
    • Winnings are taxed at current tax rates, which could be higher in the  future.
    • Older people are guaranteed to get their entire winnings via the lump  sum.
    • No risk of unknown future variables affecting your payout. You’re guaranteed  to at least receive the lump sum.

    Disadvantages

    • Poor financial management of a lump sum payment, such as an overly  aggressive investment portfolio or careless and outlandish spending, could leave  you penniless.
    • As mentioned above, that $10 million jackpot lottery ends up being around $5  million in real money and only $3 million (or less) after taxes.
    • You give up a guaranteed income stream.

    Taking the Long-Term Payout

    When you take the long-term payout, you receive the full amount of the  jackpot over a period of 20 to 30 years. Here are some of the most important  advantages and disadvantages to taking it:

    Advantages

    • Annual payments provide long-term cash flow.
    • An annual payment will likely land you in a lower marginal income  tax bracket than the lump sum, so you may pay less in taxes over the payout  term.
    • You can’t “blow through” your entire winnings at once.
    • You can better budget and maintain a certain standard of living with a  guaranteed annual payment.

    Disadvantages

    • You lose the opportunity to invest the lump sum and take advantage of  compound interest.
    • The annual payout is not adjusted for inflation,  which means it becomes slightly less valuable every year.
    • If you die before payments conclude, the remainder of your winnings may or  may not pass to your heirs. This depends on the lottery and the state you won  in.
    • If the lottery goes belly up, your payments might too.
    • You have limited access to winnings. For example, if an emergency or  opportunity arises, you can’t access any more than your annual payment  amount.

    After Claiming Your Prize

    OK, so you made the necessary arrangements before asking for your winnings  and you decided how you want to be paid. Now what?

    1. Talk to the People You Hired If you hired the right  people, they are there to help, so use them often. If you find that you don’t  trust them, hire new people. This kind of wealth can be scary if you’re not used  to it, so seek qualified help and use it to make informed decisions.

    2. Pay Off Debt Whether it’s leftover student loans, a  second mortgage, credit cards, or auto loans, pay off the debt you’ve carried  around for years.

    That said, you may want to keep your primary mortgage as long as it has a low  interest rate. This is because the more money you have, the higher tax bracket  you’re often in, and the more important tax deductions become. Either way, get  rid of all your high interest debt, and then consult with your professionals to  determine what to do with the rest.

    3. Start an Emergency Fund Even millionaires run into  financial problems, sometimes more so than the rest of us! Setting  up a healthy-sized emergency fund is one of the smartest things you can do  with your winnings. A good rule of thumb is to set aside enough to pay for six  months of expenses.

    4. Put Away Money for Retirement Allocate a percentage of  your winnings to retirement accounts, such as an annuity. You don’t want to have  to go back to work at 80 after being a jackpot winner, do you?

    5. Setup College Funds Do you have kids or want to  provide for someone else’s kids? Making tax-free gifts toward a love one’s  education can be quite rewarding. One option you can look into is the 529  college savings plan.

    6. Give to Those Less Fortunate Whether it’s to a church,  a charity, or just to a family member facing hard times, consider sharing some  of your good fortune. Plus, when you give to a qualified charity, you get to deduct  the donation on your taxes!

    7. Learn to Say No Everyone you know and everyone you  have never met is going to ask you for money, for both good and bad reasons. You  need to learn to say no to most of them until you decide how you want to spend  and save your winnings. Otherwise, you could have nothing left before you know  it.

    This may be one of the hardest things you’ll have to do. Rest assured, some  people will pressure, threaten, or otherwise try to manipulate you to get their  way. An easy out can be to say you’ve agreed to discuss everything first with  your spouse, or your parents, or your financial advisor. Pick one and use it if  someone just won’t let up.

    Final Word

    Winning the lottery can be a dream come true, but only 1 in almost 200  million people actually win the Powerball lottery, for example. While those are  some seriously stacked odds, the fact is that some people do eventually win and  usually have no idea what to do afterwards.

    If you’ve won the lottery or know someone who has, consider the tips above.  You’ll be familiar with what to do should your dream come true.

    Read more: http://www.moneycrashers.com/what-to-do-win-lottery/#ixzz2LKLganPH


      United States
      Member #124498
      March 14, 2012
      7024 Posts
      Offline
      Posted: February 19, 2013, 2:55 am - IP Logged

      I won 1,000,000 and was reading on the back of the scratch off that anything between 1 mil & 3 mil is paid over 25 years... I thought there was a choice? Any advice?

      Spend wisely!!!

      And congrats!

      Disapprove(I still hate scratchies, so messy.)

      Put at least 5 grand aside.  Get a good system.  Take a vacation to virginia, and destroy their pick 5!!!Smash

        Avatar
        Pennsylvania
        United States
        Member #109279
        April 9, 2011
        1221 Posts
        Offline
        Posted: February 19, 2013, 5:39 pm - IP Logged

        I won 1,000,000 and was reading on the back of the scratch off that anything between 1 mil & 3 mil is paid over 25 years... I thought there was a choice? Any advice?

        Congrats. Would love to see a photo of it. If you post though, I would cover the ticket # and also the long code on the ticket(if you scratched that much). Still freakin awesome. Take advice of the poster above. Get all your ducks in a row before going public and cashing it.

          Avatar
          casper wyoming
          United States
          Member #136350
          December 9, 2012
          28 Posts
          Offline
          Posted: February 19, 2013, 8:30 pm - IP Logged

          can you post a pic of said ticket.

            Avatar
            LA CA
            United States
            Member #118695
            November 6, 2011
            399 Posts
            Offline
            Posted: February 20, 2013, 12:30 am - IP Logged

            Wow ! Congrats ! Thats awesome...a pix of the ticket would be awesome..

              dr65's avatar - black panther.jpg
              Pennsylvania
              United States
              Member #74096
              May 2, 2009
              16232 Posts
              Offline
              Posted: February 21, 2013, 7:36 am - IP Logged

              I won 1,000,000 and was reading on the back of the scratch off that anything between 1 mil & 3 mil is paid over 25 years... I thought there was a choice? Any advice?

              SIGN YOUR TICKET!

              WTGGGGG!! Party

              369 209

              1741

                Avatar
                AL
                United States
                Member #137161
                December 28, 2012
                30 Posts
                Offline
                Posted: February 21, 2013, 9:43 am - IP Logged

                Congratulations!!!!! Don't spend itHurray! all in one place..............

                 

                BananaParty

                  Avatar
                  New Member
                  Skippack, PA
                  United States
                  Member #139396
                  February 21, 2013
                  11 Posts
                  Offline
                  Posted: February 21, 2013, 1:40 pm - IP Logged

                  That is Fantastic!  Congrats!

                   

                  I've heard rumors that you can use old, losing tickets as part of your tax write off to help off set all of the taxes you're about to pay, so if you have a lot of them laying around, don't throw them away.  Call an accountant and ask them what the rules are.....see if you can use them as a tax write off (or if it's worth it....you might have to have A LOT of them to make it worth your while).......There's something in the tax rules about 'losses' towards your winnings.  As your accountant to research it for you.

                  Enjoy your winnings!

                    Avatar
                    San Diego
                    United States
                    Member #132750
                    September 11, 2012
                    32 Posts
                    Offline
                    Posted: February 22, 2013, 1:45 am - IP Logged

                    thanks for the heads up, I probably saved alot of them.

                      Avatar

                      United States
                      Member #122473
                      February 1, 2012
                      402 Posts
                      Offline
                      Posted: February 22, 2013, 9:23 am - IP Logged

                      I won 1,000,000 and was reading on the back of the scratch off that anything between 1 mil & 3 mil is paid over 25 years... I thought there was a choice? Any advice?

                      Hi JelwleeT,

                      Congrats on your huge win! It looks like people have given you good advice. I'm curious have you been playing the lottery for years or were you an occasional player who won?