Welcome to my series on Wealth Events and Instant Wealth. I’ll be taking you through a series of blog posts about the types of wealth events and what you can do when they occur.
Winning the Lottery
Wow! You won the Lottery! You have been playing for years and you knew the likelihood to win was probably not very high. However, you thought “people win and I just might.” And you did win!
Winning the lottery - taking the cash proceeds
Now what? You wonder “how do I handle the money what is the best use?” You have been dreaming about this for a long time and now it’s real.
1. Do you take a lump sum and take control of the money?
2. Do you annuitize and decide on how much income per month for the rest of your life?
3. If you die does the money stop or can it be passed on as an inheritance?
Nightmare lottery stories
There are many nightmare lottery stories about people winning the lottery and losing everything, to the point where they are worse off than before. Just go to google and search for “Past Powerball Winners: Where are they now?” There are many situations where people who won were not prepared for the massive media focus on their lives and the people who came calling.
Taxes and having advisors on your side
Taxes, in the form of income and estate, can be so large that you may end up in a poor financial situation. Some people even go bankrupt or are sued. It is extremely important to have people you trust to buffer you from individuals coming out of the woodwork and hitting your wallet for everything from loans to gifts to non-profit organizations. You must learn to say no. For every yes you give to those who ask you to support them, think about for whom are you saying no.
Plan wisely for a lottery win
There are good stories and there are bad stories. You can find them on google. Just remember to plan and think wisely about your next steps. Reflect on the risks you are taking. After the euphoria fades, don’t risk your lifelong loss of friends and family. Talk to a Certified Financial Planner® and map out the process.
If you’re not sure how to proceed, please contact us for a 30-minute consultation!