Winning the Lottery

Sudden Wealth

Winning the Lottery

Winning the lottery!

Does winning guarantee happiness? Making the right decisions does.

Congratulations on your big win and beating the odds!!!

Yes, you’re the winner, but once the excitement of winning is over and you’ve claimed your prize, here come the phone calls, promises, marriage proposals, accusations, and threats. People who used to volunteer to help you do things now want money for their trouble. Family members and friends who kept their opinions to themselves are now trying to run your life, and control your money. What do you do now?

1) If you are concerned about people contacting you, consider changing your cell and home phone numbers, or allow voicemail to pick up the phone – especially if you do not recognize the incoming phone numbers.

2) Interview and assemble a team of professionals to assist you with the management of your winnings. You may want to start with a Certified Financial Planner® who can help quarterback the team of professionals you will need to help you protect your assets, and make proper financial decisions.

3) Be wary of solicitations for donations. This is best handled by your team of advisors, once you have set up your finances and completed the financial planning process.

4) Be cautious of initial spending. Spending money fast and furiously will only leave you fast and furiously broke. Proceed carefully. Be protective and respectful of your newfound wealth!

If money could bring happiness

Research in psychology and economics has found that people do get happier as their income increases, but only up to a certain monetary level – and only where they are comfortable. One of the more recent studies on the subject found that life satisfaction will rise – up to a household income of about $75,000, and will level off afterward.

In general, the research on the happiness of lottery winners is mixed. A 2006 study in the Journal of Health Economics of lottery winners in Britain who won up to $200,000 found an improvement in their mental well-being two years later. But an often-referenced study from 1978, comparing 22 major lottery winners with people who did not win, found no difference in happiness levels between the two groups.

All you need is a ticket to be a winner, but to effectively manage the windfall from a large lottery win, you’ll need much more than that. There are many unique financial, legal, and tax issues that must be addressed relatively quickly, starting with the time limits on claiming your lottery prize.

Vermillion Financial Advisors can help you build your financial management team, and provide counsel for the many decisions you will face. We can help you manage and protect your winnings, so you can enjoy the happiness and satisfaction they can bring.

Here are just a few questions we will help you answer:

• What are the benefits of setting up a blind trust?
• Should I have a plan before I claim the prize?
• Should I take the lump-sum amount or the annuity?
• Is it better to get the lump-sum and then use part of the money to buy an individual annuity?
• How can I make sure that I will always have enough money?
• How can I protect my money from others?
• What are some good ways to share my money with friends and family?
• How can I tell friends and family “no”?
• Can I afford to quit my job?
• How should I deal with the media and the publicity?
• How can I use the money to improve my life?
• What can I do to make sure my children do not become spoiled and unmotivated by the money?
• How can I pay as little tax as legally possible?
• How should I invest my lottery winnings?