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A customer shows his Powerball tickets purchased on Friday, August 18, 2017 in Hialeah, Florida. An estimated $ 535 million for the draw scheduled for Saturday night. (AP Photo / Alan Diaz)
What would you do if you earned $ 1 billion?
Nearly one billion dollars are up for grabs in the latest Powerball and Mega Millions jackpots.
Here's what you need to know and what to do if you are rich.
1. Stay anonymous
If you win the lottery, your natural inclination may be to let everyone know that you have won the jackpot.
Imagine how long lost cousins and childhood friends can suddenly appear to celebrate your new wealth.
However, your best gesture is to remain anonymous.
Although the rules on anonymity vary from state to state, some states require all lottery winners to disclose their identities.
You can choose to remain anonymous when you win the lottery in six US states: Delaware, Kansas, Maryland, North Dakota, Ohio and South Carolina.
Other states where Powerball is sold, including Washington DC, Puerto Rico and the US Virgin Islands, require winners to publicly disclose their identity, including their name, city and prize amount.
One way to protect your identity is to accept your lottery prize through a legal structure such as a blind trust.
2. Sign your lottery ticket
Make sure you sign your winning lottery ticket.
Why?
A lottery ticket is considered a bearer instrument, which means that whoever signs the ticket can claim the lottery prize.
However, what you write on the lottery ticket can have an impact on your anonymity. Therefore, think twice and consult a lawyer before signing the ticket.
3. Decide how to get paid
If you win the lottery, you decide how you want to be paid: either a down payment, a cash payment or an annuity payment.
With the lump sum payment, you now receive the money in a single payment. Or, you can choose to receive annuities over the next 30 years.
For Mega Millions, the jackpot is the largest of all time: $ 654 million. If you choose the initial payment option, the payment would be about $ 372 million. For Powerball, the jackpot is the 17th largest of all time with $ 345 million. If you choose the initial payment option, the payment would be about $ 199 million.
Which payment option is the best?
Think of it as: a dollar today is worth more than a dollar tomorrow. With a lump sum payment, you can invest money today and get a financial return.
With the annuity payment option, spreading payments over 30 years can help limit any potential impulse to incur reckless expenses.
4. Get professional advice
Do not leave alone.
Make sure you have a team of first-rate experts to help you achieve your wealth management goals.
At a minimum, your consulting team should include a financial, legal and tax advisor to manage your investments, tax planning, insurance and estate planning, among other important aspects of managing your wealth.
No matter how many counselors you hire, do not forget to sign your own checks.
After all, it's your money so make sure you know where it's going.
5. Pay off your existing debt
With your new wealth, make sure you simplify your financial life.
Pay off your student loans. Overcome your credit card debt. Get your financial life in order.
Yes, you could possibly get a higher financial return by keeping the outstanding debt and investing in the stock market.
However, a simple financial house will make your life easier.
Remember: When you win the lottery, your goal is to enjoy an easy life.
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A customer shows his Powerball tickets purchased on Friday, August 18, 2017 in Hialeah, Florida. An estimated $ 535 million for the draw scheduled for Saturday night. (AP Photo / Alan Diaz)
What would you do if you earned $ 1 billion?
Nearly one billion dollars are up for grabs in the latest Powerball and Mega Millions jackpots.
Here's what you need to know and what to do if you are rich.
1. Stay anonymous
If you win the lottery, your natural inclination may be to let everyone know that you have won the jackpot.
Imagine how long lost cousins and childhood friends can suddenly appear to celebrate your new wealth.
However, your best gesture is to remain anonymous.
Although the rules on anonymity vary from state to state, some states require all lottery winners to disclose their identities.
You can choose to remain anonymous when you win the lottery in six US states: Delaware, Kansas, Maryland, North Dakota, Ohio and South Carolina.
Other states where Powerball is sold, including Washington DC, Puerto Rico and the US Virgin Islands, require winners to publicly disclose their identity, including their name, city and prize amount.
One way to protect your identity is to accept your lottery prize through a legal structure such as a blind trust.
2. Sign your lottery ticket
Make sure you sign your winning lottery ticket.
Why?
A lottery ticket is considered a bearer instrument, which means that whoever signs the ticket can claim the lottery prize.
However, what you write on the lottery ticket can have an impact on your anonymity. Therefore, think twice and consult a lawyer before signing the ticket.
3. Decide how to get paid
If you win the lottery, you decide how you want to be paid: either a down payment, a cash payment or an annuity payment.
With the lump sum payment, you now receive the money in a single payment. Or, you can choose to receive annuities over the next 30 years.
For Mega Millions, the jackpot is the largest of all time: $ 654 million. If you choose the initial payment option, the payment would be about $ 372 million. For Powerball, the jackpot is the 17th largest of all time with $ 345 million. If you choose the initial payment option, the payment would be about $ 199 million.
Which payment option is the best?
Think of it as: a dollar today is worth more than a dollar tomorrow. With a lump sum payment, you can invest money today and get a financial return.
With the annuity payment option, spreading payments over 30 years can help limit any potential impulse to incur reckless expenses.
4. Get professional advice
Do not leave alone.
Make sure you have a team of first-rate experts to help you achieve your wealth management goals.
At a minimum, your consulting team should include a financial, legal and tax advisor to manage your investments, tax planning, insurance and estate planning, among other important aspects of managing your wealth.
No matter how many counselors you hire, do not forget to sign your own checks.
After all, it's your money so make sure you know where it's going.
5. Pay off your existing debt
With your new wealth, make sure you simplify your financial life.
Pay off your student loans. Overcome your credit card debt. Get your financial life in order.
Yes, you could possibly get a higher financial return by keeping the outstanding debt and investing in the stock market.
However, a simple financial house will make your life easier.
Remember: When you win the lottery, your goal is to enjoy an easy life.
