What to do after you
win the lottery
Hitting the jackpot may be a fantasy, but what's the
harm in dreaming? Here's some realistic advice on what to do if
those numbers prove to be magic.
It's after 11 p.m. on Saturday night, a night like
any other Saturday night. You're ready for bed and yelling at the
dog to get out of the garbage. With little enthusiasm or hope, you
tune in to the drawing of the state's lottery numbers on TV. A quick
glance at the numbers tells you that you wasted yet another ...
wait a minute! The numbers on your ticket match. You just won
First items on a new millionaire's to do list: Scream,
jump up and down a lot and hug whoever is at home with you -- even
that stinky dog.
Once you catch your breath ... ask yourself, "Now
You're probably pretty anxious to get your hands on
all that dough. Whoa there, moneybags. Temper that euphoria. Your
life is about to change in a dramatic way. Most winners take anywhere
from four days to two weeks before turning in their winning ticket,
says Leslie Steele, communications director of Florida Lottery,
in Tallahassee, Fla., because they are busy getting some vital legal
"Don't collect right away," advises Michael Garrison
of Garrison Asset Management in West Chatham, Mass. "Get your support
system in place."
"I'd sure see the accountant before turning in that
ticket about what, tax-wise, is the best thing to do," agrees Christine
Hartigan, a certified financial planner in Kansas City, Mo.
Therefore, here's your second new millionaire's to
Keep that ticket safe.
Steele says people do funny things with their tickets, such
as keeping it in a baggie in the freezer, in a sock under the
mattress, in a money-belt around their waist day and night,
or most practical of all, in a safe-deposit box.
Think about your job.
A winning ticket is a grand thing, but it doesn't really count
until you've got the cash. For now, consider just taking a little
sick time or vacation, without explaining why, if possible.
You're going to be very busy becoming a millionaire. You probably
will quit eventually. Steele says usually winners do, even though
at their original interview many claim they'll keep working.
She explains, "They can't imagine how much money they've won.
It's a life-changing event."
Find people you can trust.
"The most important financial decision to make initially is
who's going to be accountant, financial adviser and lawyer,"
explains Hartigan. "And I don't think they should be the same
If you don't have all of these people in your Rolodex
currently -- and how many of us do? -- "Talk to other people who
use these kinds of services. Referral is the best way," Hartigan
suggests. If none of your friends or family can recommend a particular
professional, Hartigan recommends going to a major accounting
firm, a major brokerage and a large law firm. "Ask what they'll
do for you."
Garrison agrees with Hartigan's advice and adds,
"References are mandatory."
"With the lump sum invested properly, you'll probably
have more at the end," advises Hartigan. "If you're a person who
really can't control your spending, annual might be better." In
Florida, the recent trend shows 85 percent of winners take the
lump sum, according to Steele.
Arrange for a special account
at the bank. You can't just deposit millions into your plain
ol' checking account. And they don't really give you a paper
check with a lot of zeroes. They give you the money by a wire
transfer to your pre-arranged special account, explains Steele..
Change your phone number.
Now that you're richer than your wildest dreams, everyone's
going to want to reach out and touch you, and that will be a
nightmare. So get a new unlisted telephone number.
Ticket to ride
OK, breathing has returned to normal, pulse is steady,
and your financial affairs are ready. Go get that money.
Any ticket worth more than $250,000 has to be turned
in to lottery headquarters, according to Steele. Amounts may vary
with other lotteries. You're about to become filthy rich, so splurge
if you want to and arrive at lottery headquarters by limo, helicopter
or elephant, if you are so inclined.
But don't take too much time. There's always a deadline.
The Florida lottery gives winners 180 days (that's less than
6 months) to hand over the ticket, says Steele. Other lotteries
have different deadlines, and they take them seriously.
Once you're at the lottery headquarters, you can be
sure they'll be checking that ticket over carefully to make sure
it's legitimate. Steele says no one's tried to turn in a bogus ticket
in Florida since the early days of the game, but they still play
Even though it didn't buy a ticket, the government
will be also a big winner. The Tax Man cometh before you even get
your money, immediately making you 28 percent poorer. And if you're
the kind of scoundrel who owes something called state-owned-debt,
such as back taxes or child support, the lottery folks take that
off the top as well. You've paid your debt to society and you're
still a millionaire, so enjoy.
Once you turn in that ticket, the lottery is required
by public information law to release your name and hometown. In
other words, you can't avoid the world finding out about you. You
might think about holding a press conference to get the media attention
over with all at once. And besides, you might be the type that wants
to crow to the world, "Look at me, I'm a millionaire!" Admittedly,
this will save you time from having to call all those ex-lovers
On the other hand, perhaps the less well known your
face is to the public the better. In a short while, you're going
to have more friends and relatives than you ever knew.
All of the changes to your life will not necessarily
be good. Garrison mentions a study of lottery winners that shows
a majority of these new millionaires end up overextended with a
high rate of divorce. He knows these troubles second hand from a
$1.5 million dollar lottery-winning client. "More than once, he
said he wished he hadn't won," says Garrison.
"All kinds of things come to the surface," he adds.
"Money does not solve all problems."
Cents & insensibility
And what problems to have: Taxes, greedy relatives
and friends, expensive decisions, and, possibly worst of all, yourself.
Finding a way to spend millions may seem insurmountable,
but it's really not that difficult. Many folks -- lottery winners
and insta-rock stars alike -- have succeeded in finding solutions
to this particular "problem." And just think, then you'd have to
get a job again, and that would be awfully embarrassing.
"Great wealth brought on all of the sudden to somebody
unprepared is going to bring trouble," says Paul G. Schervish, director
of the Social Welfare Research Institute at Boston College. He lists
examples of spiritual trouble to marital trouble to friends, neighbors
and charities coming after you.
"Wealth changes the terrain within which you are playing,"
he continues. "People with swift fortunes are most vulnerable to
not knowing what to do with it." The money will be thrust upon you
and so will a multitude of requests and decisions. Schervish advises
slowing things down. Financial counselors can help a newly minted
millionaire take things slowly.
Hartigan explains that good financial and legal advisers
Provide a buffer to all the requests and wild
ideas you'll be hearing for the rest of your life
Protect you from yourself by advising you ways
to manage the millions
Help you turn your new money into even more money
"Understand thoroughly what you want to accomplish,"
advises Garrison. "It's not just a matter of money management. It's
also counseling and helping people deal with all this wealth on
psychological and practical matters."
You'll probably want to help out your family and those
folks who were friends before you were rich. You might be interested
in leaving a legacy by helping your favorite cause in a major way.
Of course, you'd like to secure your own future as a luxury-loving,
well-manicured, hundred-dollar-bill-burning type of guy or gal.
Financial advisers can inform you and guide you into trust funds,
endowments, charitable remainder trusts, family limited partnership
And you'll probably want to have something at the
end to leave to your heirs -- 'cause then you get to play all kinds
of mind games writing up your will different ways. Unlike us paycheck-to-paycheck
schlubs, you'll need to start thinking long term -- looking ahead
to your death. It's a grim subject for a new millionaire like you,
but an important one. Now's the time to be doing what you can to
contain the estate tax that could eat up most of your heirs' inheritance.
"Taxes are important to consider. But don't let the
tax tail wag the investment dog," explains Garrison. He says you
also want to be aware of your tolerance to risk, your level of knowledge
and goals. He recommends a comprehensive approach or "you could
have a current planning strategy in conflict with long-term estate
planning." Thinking ahead to curtailing future estate tax can also
help you curb your present income tax.
Ah, with all your sound planning, you're finally settling
into the good life. You've paid off your parents' mortgage. Bought
yourself a nice Porsche. Done your tax planning. Established an
endowment to save dyslexic whales. Now you are enjoying an expensive
facial at an exclusive Caribbean resort.
Erk! Facial? Your bleary eyes open to discover that
damn dog licking pizza sauce off your cheek. The news station has
moved on to sports. Your losing lottery ticket is floating in a
bowl of melted ice cream. It was all a dream.
-- Updated: March 12, 2004