Important Tips To Assist You To Secure A Big Lottery Win
With a big lottery win, you need the right money management ideas to put that to fair use. Once you win the lottery, be ready for the vultures surrounding you for hefty help all of a sudden. If you don’t already have smart money habits, it can quickly turn into your worst enemy.
Take precautionary steps so that you don’t end up squandering the fortune. Firstly go and sign the lottery, the moment you know the result before it blows out of your hand. Here are a few handy tips to steer clear of the additional risks.
Remain Anonymous and Save Yourself
If people suddenly find out you won vast amounts of cash, your phone will badger with unwanted requests. You will start receiving calls from NGOs, charities, and many long lost friends who never bothered about you till now.
Check for the state rules and see if it allows the winner to remain anonymous. The winners usually get around 180 days to a year time to claim their rewards. However, it is better to check on the rules and then plot a course accordingly.
Consult a CA or Tax Pro before you receive the amount
The winner has a choice to draw the amount all at once or in instalments in the form of an annuity. If you choose the first one, you will have to pay the tax all at once. However, for the latter, you will pay tax only for the instalments you receive.
You can opt for advisors that will help you crunch numbers and decide which payment option is suitable for you.
Don’t Jump to Drastic changes
It is better to keep the first six months as it is after winning the lottery. Never make sudden changes and impulsive decisions without thinking logically. Also, don’t just quit your job all of a sudden or plan an all-world tour out of nowhere. Try to keep it slow and be a bit more careful in decision making.
Always save the big purchases, like a house or a car, for later. Meanwhile, try to set aside a fixed amount that you can use to celebrate your victory.
Invest in the Right Approach
Don’t follow the advice of everyone, especially when it is related to investment. It is better if you keep the money untouched for the first six months. It will also give you time to get the right team of advisors for your investment.
Your advisors will then form an investment portfolio, half-covered with equities and the other half with fixed income. Never fall for any advice that you cannot understand or is totally out of your league.
Discipline to live within a budget
When you earn a lot of money all at once, it is very typical to lose control. However, if you want to enjoy the benefits of a big lottery win for a long time, discipline is a must. You can invest in improving the standard of living, but it is sheer stupidity to go on a wild spending spree.
The best way to restrain yourself is to avoid spending principle at all costs. Especially in today’s investment world, it is better to spend the income as principle dissipates very quickly.
A Team of Legal and Financial Advisors
With such a huge amount of money, you need proper finances to make the right decision. Always handpick the lawyer, investments advisor, and accountant on your own. Do a background check to know everything about the people you will share your personal information with.
In case you reside in a small town, take the help of an expert from the nearest big city. The team has to serve as your board of directors, and they need to work in coordination for better advice.
Guard against losing the assets to creditors
For people with a lot of money, it is important to save your assets from creditors. It includes everyone from ex-spouses to people who won lawsuits. Keep this in mind to ensure at all times that you are not an easy target.
You can take the help of state-law exemptions to create barriers with trusts, limited partnership, and liabilities companies. Try to go through multiple strategies and plans, and take the benefit of the advisors if necessary.
Annual Charitable Deductions
Gifts to public charity and donors provide an income tax deduction of up to 50%. It can help offset additional income from the lottery winnings or the annuity instalment payments. Try going for a donor-advised fund and claim a federal tax deduction for the contribution.
You no longer have to panic while securing a big lottery win. These handy tips, if followed religiously, can help you tackle any problem related to finances. Don’t get caught up by the sob stories and the hounding charities, and be ready to take responsibility for the vast amount.