Featuring a record breaking $500 million jackpot, the Powerball stakes will be particularly high during Wednesday night’s drawing. The jackpot is expected to keep growing until the drawing, and Maggie Fazeli Fard offers advice on what you should do if you win:
Let’s say you win. Before you quit your job, buy that Maserati and fly off to Fiji in a private jet, here are five things you should do:
1. Take a deep breath. Yes, you’ll be excited, but try to stay calm and think through any decisions you make.
2. Sign your ticket. The ticket is the only claim you have to the prize. Make sure you sign the back and put it in a safe place. Some lottery officials even recommend placing it in a safe deposit box.
3. Keep quiet. As tempting as it is to shout about your windfall from the rooftops (or post it on Facebook), experts recommend keeping the news of your win to yourself, at least until you’ve stashed the signed ticket someplace safe.
4. Get professional advice. Consult with a professional financial adviser and/or lawyer. They can help you decide how to claim your prize (annual payments vs. lump sum) and help you tackle tax, investment and estate-planning issues that will come up.
Past lottery winners also have some advice for winners, according to the Associated Press:
Past winners of mega-lottery drawings and financial planners have some more sound advice: Stick to a budget, invest wisely, learn to say no and be prepared to lose friends while riding an emotional roller-coaster of joy, anxiety, guilt and distrust.
“I had to adapt to this new life,” said Sandra Hayes, 52, a former child services social worker who split a $224 million Powerball jackpot with a dozen co-workers in 2006, collecting a lump sum she said was in excess of $6 million after taxes. “I had to endure the greed and the need that people have, trying to get you to release your money to them. That caused a lot of emotional pain. These are people who you’ve loved deep down, and they’re turning into vampires trying to suck the life out of me.”
The single mother kept her job with the state of Missouri for another month and immediately used her winnings to pay off an estimated $100,000 in student loans and a $70,000 mortgage. She spent a week in Hawaii and bought a new Lexus, but six years later still shops at discount stores and lives on a fixed income — albeit, at a higher monthly allowance than when she brought home paychecks of less than $500 a week.
“I know a lot of people who won the lottery and are broke today,” she said. “If you’re not disciplined, you will go broke. I don’t care how much money you have.”
Lottery agencies are keen to show off beaming prize-winners hugging oversize checks at celebratory news conferences, but the tales of big lottery winners who wind up in financial ruin, despair or both are increasingly common.
There’s the two-time New Jersey lottery winner who squandered her $5.4 million fortune. A West Virginia man, who won $315 million a decade ago on Christmas, later said the windfall was to blame for his granddaughter’s fatal drug overdose, his divorce, hundreds of lawsuits and an absence of true friends.
The National Endowment for Financial Education cautions those who receive a financial windfall — whether from lottery winnings, divorce settlements, cashed-out stock options or family inheritances — to plan for their psychological needs as well as their financial strategies. The Denver-based nonprofit estimates that as many as 70 percent of people who land sudden windfalls lose that money within several years.
“Being able to manage your emotions before you do anything sudden is one of the biggest things,” said endowment spokesman Paul Golden. “If you’ve never had the comfort of financial security before, if you were really eking out a living from paycheck to paycheck, if you’ve never managed money before, it can be really confusing. There’s this false belief that no matter what you do, you’re never going to worry about money again.”
I don’t want to win the Powerball jackpot. You can have my ticket.
This is not for the usual practical reasons that people do not wish to win the Powerball jackpot — inevitable ruin of life, reckless purchases, massive tax burden, disintegration of family life.
No, I worry about opening the improbability floodgates. The odds of winning the Powerball jackpot are so minuscule that, if that happens, who knows what things might start occurring!
Once you’ve done something as gallopingly unlikely as winning the Powerball jackpot, being mauled by a bear looks easy! (My enthusiasm for the possibility of winning the Powerball jackpot is matched only by my firm grasp of the laws of probability.)
Consider — here are a few things likelier than winning the Powerball:
— Being abducted by Zeus (pretty likely actually)
— Successfully navigating an asteroid field (3720 to 1)
— “Two and a Half Men” ever going off the air
— Americans ever approving of Congress
— Being eaten by a shark
— Being mauled by a bear
There is still time to buy tickets before Wednesday nights drawing. If you want to buy with a group, than Fazeli Fard has some guidelines to follow:
According to Virginia State Lottery officials, group purchases with friends, family, co-workers or others shouldn’t be a problem — as long as everyone is on the same page from the start.
“Basically, our advice would be this: have an agreement in place, signed by all of your members, that details how you will split any wins,” according to officials. “You could even have the agreement notarized if you choose.”
Here are some more tips to keep your lottery pool running smoothly:
1. Agree upon the rules. Decide on a buy-in amount and how the winnings would be split (equally or proportional to amount of money played, annual payout vs. cash option, etc.). Oral agreements are okay, but putting it in writing is a safer bet, according to officials.
2. Designate a “pool manager” who is responsible for purchasing the tickets and keeping them safe.
3. Make photocopies of the purchased tickets for each member of the group.
4. Decide if the pool manager would claim the winning ticket or if the entire group wants to claim it. All winners do not need to be present as long as required proof of identification is provided for each person.