Quote:
Originally Posted by MCO_David
Always take the lump sum payment, set aside 10 to 15% that will be your "fun" money, invest the rest in something secure that can generate monthly revenues that will kick in once your "fun" money is gone or once you are tired of blowing money on BS.
Also, I thought that in the case of the Powerball, you did not have the option of being anomymous, in reality they state that:
All but three states (DE, KS, ND) have laws that require the lottery to release the name and city of residence to anyone who asks. One state (SC) will keep your name secret if you request it, but if someone files a Freedom of Information Act request, you may have to file a plea with the judge to deny it. Another state (OK) now has a law that allows you to claim in a trust and to keep your name from the press (though the lottery will run checks on you). Photos and press conferences are up to you for most, but not all states. Check with your state lottery to see if photos or more are required. Most of the time, it is advisable to get it over with the press so that you don't have one or more reporters following you around to get that "exclusive" interview. A few more lotteries may work with you on setting up a trust or other partnership. You or your representative should contact the lottery for the details after you win.
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that is a logical idea, the problem is that most people who win the lottery have no idea how to invest it and they don't take the time to educate themselves and surround themselves with people that do.
There was a show I watched a little while back about people who won big lotteries and lost it all. One guy was 27 and won around 100 million. He took the lump sum and ended up with about 30 million after taxes. At first he was smart. He got married (was already engaged) and threw a nice wedding and had a nice honeymoon. Then he bought a nice house for he and bride to start a family in. His brother had a business idea and he invested heavily into that only to find out that they were beat to the market with the idea and the money basically was lost. He then invested in second business that went bankrupt and he lost that money. This happened time and again eventually he took the last of his money and invested it into a resort. The resort was then fixed up and sold and it turns out his business partner screwed him and walked away with all the money.
He was 27 when he won. By the time he was 31 he had lost every penny of it in bad investments. Sadly, stories like this are not uncommon. I think the lottery office should assign people to help advise these winners and at least give them a few counseling sessions on what type of investments to avoid, how to say no and how to save and spend wisely.