1. Remain anonymous if circumstances rules permit it. Once people know you're suddenly wealthy, you'll be badgered by requests for handouts from everyone from charities to long-dropped friends and relatives--not to state all the financial "experts" who'll become vying for your business. So check state rules to see whether you can dodge every one of them by remaining anonymous.
Source: xsct
1.Rules on winner publicity vary by state.
In NY, for example, winners' names undoubtedly are a public record. Someplace else it may be possible to maintain your anonymity by establishing a trust or limited liability company to obtain the winnings, says Beth C. Gamel, a CPA with Pillar Financial Advisors in Waltham, MA. A person of Gamel's who won a past lottery did that, and had a lawyer claim the prize regarding of the trust. In SC, you may also remain anonymous.
Depending on where you bought the ticket, prize winners have between 180 days and a year from the date of the drawing to claim their prize. So uncover what the state rules are and plot a course.
2. Go to a tax pro before you cash the ticket.
You own your choice between taking the prize money at the same time or having it paid in 30 installments over 29 years by way of an annuity. With a lump sum payment, you have to immediately spend tax on the entire amount, says Michael A. Kirsh, a financial planner in NY. With an annuity, you are taxed simply as you have the payments. Individuals who've trouble controlling their spending might pick the discipline of receiving the money as an annuity. But this payout type offers additional drawbacks, Kirsh notes. You will have to compare the effective yield of the annuity using everything you could earn by taking the amount of cash as a lump sum, paying the taxes and investing the proceeds.
3. Avoid sudden lifestyle changes.
For the 1st half of a year once you win the lottery, don't do anything drastic, like quitting your task, purchasing a home in Europe, trading up for an extravagance car or creating a variety of Birkin handbags. Meanwhile, reserve an arranged amount for splurges-it's just natural to have to celebrate your windfall.
Save the big purchases for later. For example, you could rent a residence in a nearby where you're considering moving, before you make any commitments, says Guerdon Ely, a financial planner in Chico, Calif. If you prefer a fresh car, buy a budget model for today's time.
4. Pay off all your debts.
As I wrote in my post, "THE MOST EFFECTIVE Investment Advice I Ever Received," there is no better investment than paying off debts. Be it personal credit card debt or a mortgage, your rate of return equals the interest on the loan. With today’s abysmal yields on relatively secure investments like CDs and Treasurys, that's particularly true. When you’ve reduced a dollar of debt, that’s a dollar as long as owe. When you invest a dollar, you can’t be sure whether it'll grow or shrink.
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