Here’s What You Should Actually Do With Your Payout Lottery Winnings

payout lottery winnings

Congratulations! You’ve just won the lottery.

Or, at least, those are the words you’re expecting to hear at any minute. Sure, your chances of winning may actually be one in a gajilion, since the lotto is the most popular and widely practiced form of gambling in the United States — but, as they say, you never know.

You probably have lots of lofty ideas about how you’d spend your huge payout lottery winnings. After a soak in a champagne-filled hot tub and an overindulgence in caviar donuts, perhaps you even have some practical plans. Maybe you’ll buy a new house, maybe you’ll be making an investment, maybe you’ll find ways to reduce debt and pay off that $3,761 that the average person owes in revolving credit loans.

But in reality, people often don’t know how to handle all of that money once they actually receive lottery winnings. Take a quick search through Google to read all of the horror stories about past lotto winners who lost everything to overspending, drugs, gambling, lawsuits, or any other kind of foolish spending.

Don’t be that person in the news. Have a real plan for when you hit the jackpot — just don’t expect it to be as glamorous as you might think.

Step 1: Hire a lawyer. Yes, this is the step you should take before you even claim your winning ticket. The moment you put yourself forward as a winner, you forego your privacy rights. Media outlets will want to interview you. Programs will want you to support them. Supposed long-lost relatives will want to “catch up” with you. Get a professional on your side before you set out into this new world.

Step 2: Lay low. This is harder than it seems. Again, everyone will be clamoring for your attention (and deep pockets). While your lawyer gets your financial ducks in a row, maybe take that trip to Siberia — or some other place where no one will bother you — you’ve always dreamed of.

Step 3: Decide how to get your money. Most of the payout lottery winnings are delivered in annual increments, or annuities. The most common are over 25 years or until death. If you’d rather have your money up front, you can sell that annuity for a lump sum payment and get cash instead through a financial institution. If you want the best of both worlds, you can sell a portion of the annuity payments for an immediate lump sum.

No matter what you plan to actually do with your payout lottery winnings, play it smart. Have a plan and stick to it so that, when you strike it rich, you’ll be able to do everything you want.

An Important Lesson On How Not to Use Your Lottery Winnings

lottery payments

A Georgia man who won $3 million on a lottery scratch-off ticket last year has given people everywhere an important lesson in how not to manage your finances after coming into a windfall of cash. Georgia man invested his winnings in running a crystal meth operation, and now he’s facing decades behind bars.

According to The New York Times, 45-year-old Ronnie Music Jr. has been indicted as part of a larger operation involving circulation of more than $1 million worth of methamphetamine and weapons. He pleaded guilty to a federal court last week and could face a maximum sentence of life in prison.

Music told state authorities when he won last year that he and his wife were going to save up their lottery payments. “I buy tickets every once in a while,” he said after winning big in February 2015. “I couldn’t believe it, and I still don’t believe it yet.”

Clearly, there were other plans in design.

After winning a large lottery, people typically get to choose between receiving an annuity settlement that doles out lottery payments over an extended period of time — usually either over 25 years or until death for very large jackpots — or they can get a lump sum that offers cash up-front. When people get tired of waiting for those annuity payments, they sometimes sell their lottery annuities midway through in order to get more cash at once. In any case, it’s clear that Music wasn’t saving up for anything besides drugs.

Of all the different ways to invest your money, a drug ring probably wasn’t the smartest choice. You could pay off your debt, for example. The average American household owes $15,355 on credit cards and $129,579 in overall debts. Even if you decided to splurge with your winnings, you could invest in a new car for a fraction of your winnings. The average price of a light vehicle in January 2015 being $33,933.

Literally anything would be better than investing in a meth operation. Even though the Times called Music’s drug ring business “thriving,” they also reported that he could have made more money by taking the lump sum of his lottery payment and investing it in the stock market.

Instead, says U.S. Attorney Edward J. Tarver, “As a result of his unsound investment strategy, Music now faces decades in a federal prison.”

Long Island Man Wins Jackpot — Twice!

invest your moneyThey say that your odds of winning the lottery are less than your chances of getting struck by lightning. But for one man in New York, lightning struck twice.

Bruce Magistro of Long Island recently scratched off a $1 million prize on a lottery ticket. That would be enough to make anyone ecstatic, but in Magistro’s case, it’s especially mind-blowing. It’s the second time he’s won a million-dollar jackpot in four years. The first was from a $5 scratch-off in 2012. The second, a $2 win-for-life card in May.

Lotteries are the most prevalent and popular form of gambling across the United States. How would you invest your money if you won — twice?

For Magistro, both of his winnings came at crucial times of financial challenges. His first win in 2012 from a $5 Extreme Cash card gave him an annuity of $33,090 per year — enough to allow him to stay home and care for his wife, who died of cancer shortly thereafter.

Medical expenses alone can be overwhelming; in fact, 20% of all credit reports are damaged by overdue medical bills. As much as 35% of the population — some 64 million people in the United States alone — reported a struggle to pay medical bills or debt payments on time in 2014.

For Magistro, that hopefully won’t be much of a problem. Though the 48-year-old will continue to receive his $33,090 lottery payments through the year 2031 — in addition, now, to his $1,000 a week for life from his winning $2 scratch off — “you can’t retire on that,” he said to the New York Post.

Magistro works in construction (and yes, he still keeps his day job), but said business has been slow recently. He is also a widowed father of three.

Of all the different ways to invest your money or spend your lottery winnings, Magistro’s new plan may be the sweetest: he plans to marry his new fiancee.

Magistro will receive a check for his new winnings two years to the day after his first wife passed. “I think there is some kind of divine intervention here,” he said.

3 Easy and Different Ways to Invest Your Money Now

different ways to invest your money

Looking for a smart way to spend your lottery winnings or structured settlement agreement? Make your money work for you by investing it.

When we think of “investments,” we tend to think only about playing the stock market, which can be a risky business if you don’t know what you’re doing. But making an investment simply means that you’re going to put your effort or money into something now with the expectation that it will grow and provide you with even more money than you started with some time in the future.

There are different ways to invest your money besides stock markets or savings accounts. Here’re just three big ones to think about:

  1. Business Investments:Maybe you’ve always dreamed of starting your own company, bakeshop, or service, but have never had the funds to set it up. Starting your own business is expensive — on average, $30,000 expensive, according to the Kauffmann Foundation. But if you have the right idea and the right tools, it can provide a wealth of future fulfillment.

    If you’re not the self-starting type, though, you can still have a hand in future businesses by becoming a financial partner in a start-up or offering peer-to-peer lending services for other dreamers. Does your mom really make the world’s best meatballs? Prove it by helping her launch a new restaurant!
  2. Educational Investments:You’ve heard it before: An education is the best ticket to a good future. Higher education these days, however, is going to cost you a pretty penny. Private college tuition is up to an average $31,000 per year while in-state tuition at public universities costs around $9,000. When considering different ways to invest your money, this may be the most important for you or your child. A college education helps to ensure not only that you’ll secure a good job, but that you’ll find the best ways to put your skills and talents to use in the world.
  3. Pay Off Debt:Paying off your student or credit card debt might sound like more of a chore than an investment, but it truly is a way to save yourself money down the line. If you’re paying interest on outstanding debt — and the average household has about $129,579 worth of it, over $15,000 of which comes from credit cards alone — then you’ll be much better off paying as much as possible now to avoid continuously increasing interest rates that never seem to go away. Think of all the extra money you’ll have once all that debt is put to rest!

You don’t have to be a Wall Street wizard to make a smart investment. Personal betterment might be the best of all the different ways to invest your money. With it, you’ll secure yourself a bright and happy future — along with all the financial benefits!

Lavish Items to Buy With Your Lottery Winnings

lottery winnings

So you have bought a lottery ticket and are playing the most widely known form of gambling in the United States. And the heavens are shining upon you because you won! Now that you have millions in lottery winnings, what are you going to do with all that money? Sell your structured settlement today and you will get a lump sum to do whatever you want! Here are some ideas of things you can buy with your lottery winnings.

Getting out of debt
In total, Americans owe almost $12 trillion dollars in debt and the average American household has about $130,000 in debt. Selling your lottery payments is a great way to receive a lump sum that will help you pay off your debt fast. Whether it is medical debt, student loan bills, your mortgage, or credit card debt, you will soon be debt and worry free!

Buy a new house
Tired of throwing your money down the drain every month by renting your apartment or house? Now that you have your lottery winnings in your wallet, go ahead and buy your dream home! The world is your oyster, so go crazy and design what you want!

Buy a private jet
Think traveling privately is only for the rich and high class? Well, now you are one of them! Say goodbye to stuffy, crowded airplanes, and hello to leather seats, spacious amenities, and your own wait staff! Want to go to Paris for dinner or Berlin for a concert? Not a problem!

A private chef
Hate cooking? Hate coming home from a long day at work and having to put a meal on the table? Well, worry no more — your new private chef will do all the dirty work, and the dishes, for you! Your wish is their command, so prepare your taste buds for culinary masterpieces!

All the fancy cars
Stuck riding the bus and using public transport? Sell your lump sum and you can buy the cars of your dreams! A Mercedez Benz, a Lamborghini, a Ferrari, anything you want! You will be making your friends and family jealous, and will never have to deal with slow public transit again!

Have lottery winnings you want to cash in? Contact 123 Lump Sum today!

How to Make the Most of Your Lottery Earnings

lottery paymentsYou’re living every person’s dream — you’ve won the lottery. Winning the lottery is certainly sensationalized by the media and pop culture, and your first instinct might be to quit your day job and buy your dream car right away. But, in order to make the best use of your sudden windfall, it is wisest to wait before you make any rash decisions.

You have before you a lot of choices to make. Do you want to receive your lottery payments in staggered payments, or all at once? Will you use it for paying off your debt, or will you go on vacation right away? And there are more questions down the line — if you choose to receive annuity payments, will you want to get cash for lottery winnings eventually?

It should be a comfort to know that many other people all across the country are exactly in your position — if they didn’t win the lottery, they received a structured settlement of some sort. In fact, at the end of 2013, there were 34.8 million individual deferred annuity contracts in place, with a collective value exceeding $2.58 trillion. Check out these tips for how to manage your money here:

Consider Your Options
If a spreadsheet is what it takes for you to do a serious cost-benefit analysis of your options when it comes to your lottery annuity, then do it. The most important thing is that you know what your choice means financially for the coming years. If you are completely lost, it might be worth it to hire a lawyer to protect against solicitors who might get you to use your money unwisely. Whatever you do — don’t quit your day job just yet. Leave big decisions until after you weigh the options.

Invest and Save
While you might have lots of cash from lottery payments now, it might not always be so later. Use this as an opportunity to squirrel away funds for a rainy day, your retirement, your children’s college, and other big, life expenses. Over 40% of American families spend more than they earn, and if you are one of them, this is your chance to break that cycle.

Surveys show that lottery play is the most popular and widely practiced form of gambling in the United States — and it’s amazing that, against all odds, you won! Don’t squander away this once in a lifetime opportunity by spending your money unwisely.

Annuity vs. Lump Sum Lottery Winnings: 3 Factors to Consider

lump sum lottery winningsSo, you’ve won big and now you’re trying to decide how you want to receive lottery winnings. Maybe you haven’t won yet, but you enjoy the thought exercise of fantasizing about it. Playing the lotto is believed to be the most popular form of gambling in the U.S. Regardless, the biggest decision you’ll have to make (if you win) is whether you wish to receive annuity payouts, or lump sum lottery winnings. There are benefits and disadvantages to both. In the end the decision is highly personal, but here are three factors to think about that will influence your choice.

1.) Financial Standing: Most likely this will be the biggest deciding factor. If you’re fortunate enough to be in solid financial standing before, taking the lump sum lottery winnings may not be your best option. Unfortunately, as a nation American individuals owe almost $12 trillion in debt. Between school loans, car payments, and house mortgages the average household in the U.S. is almost $90,000 in debt. If you’re in desperate need of paying off debt, lump sum lottery winnings might be for you. This way you can take the money and immediately improve your situation. This is especially important as it will save you money in interest in the long run.

2.) Personal Management: Even if you’re in great financial standing you still may be tempted to take lump sum lottery winnings. This could be to your advantage if you are savvy with your money. Having that much extra cash means you can invest a great deal in a variety of ways. Stocks, bonds, and hard commodities like gold and silver are the top examples. There are a million different ways to invest millions of dollars. Don’t be afraid to enlist the help of a financial adviser though. Even if you have the skills yourself, coming into a lot of money can make people irrational. Keep in mind there’s always the risk of loss in investing. A lottery annuity can be a great way to set yourself up for a safe, consistent annual income.

3.) Other Implications: Taxes, legalities, and personal issues are just some of the other reasons to factor into your decision. A looming medical expense could be one reason to receive lump sum lottery winnings. Or even the notion that family and friends will come calling with their hands out if they hear you won millions of dollars. If you only receive a portion yearly, it might be easier to say no to those you love.

There’s really no universally right or wrong answer in the choice you make. Your personal situation will determine what’s best for you, but in the end only you can make that call. If you have faith and believe that you will be wise with one huge check, go for the lump sum. But if you prefer a safer, more conservative approach the annuity route is probably for you.

5 Tips Before You Collect Lottery Winnings

lottery winnings

Playing the lottery is the most popular and prevalent form of gambling in the U.S. according to multiple surveys. Naturally, getting cash for lottery winnings is probably the first thing most people that win a lotto will think about. If you’re ever fortunate enough to be in this situation, by all means take a second and let your mind wander. Chances are it will change the rest of your life from that point on. After you’ve taken the time to relish the moment, though, here are the first five things you should plan/do before you receive lottery winnings.

1.) John Hancock: Even before you allow yourself to ponder the vast amounts of money you’re about to come into, you should sign the winning lottery ticket. In fact, it’s probably not a bad idea to take a video of yourself doing so. This will help ensure the security and ownership of the ticket. If you don’t properly verify that it’s yours, you may have trouble collecting lottery winnings.
2.) Get Help: Depending on the winning amount and your financial standing prior, your life is about to change drastically. Don’t go at it alone. This can be tricky because you don’t want to involve more people than necessary, but you will need some assistance. A financial adviser and/or a lawyer to help you through the legal, financial, and technical aspects is a must. Family assistance is also great. Just be sure of your relationship with them, and keep in mind money can do crazy things to people. Even if they’re your own blood.

3.) Payout Option: This is the biggest decision that will directly affect your immediate future. Choosing annuity, or lump sum lottery winnings will depend on a variety of personal factors. The average person in the U.S. is $3,761 in credit card and lender debt. You may be able to pay off the majority of your debts without having to select the lump sum. This will be important to discuss with the professional help you should have already enlisted.

4.) Find Peace: This may sound like some metaphysical hub-bub, but it might be the most important piece of advice. Things are going to change quickly for you. Ground yourself in who you are as a person. Over 40% of American households regularly spend more than they generate in income. Don’t fall into the trap. Allow your new-found wealth to enhance your life, not define it.

5.) First Purchase: Okay, now time for the fun part. Take some time to decide what your first real purchase will be. It doesn’t need to be anything extravagant either. Something small that you’ve wanted for a long time could be the perfect selection as a reminder of where you came from.

Coming into a large sum of money can be as stressful as it is exciting. Follow these tips to keep one of the happiest moments of your life from turning sour.

The Top Do’s and Don’t’s of Managing Your Lottery Payments

lottery paymentsWinning the lottery is a pretty exciting thing, and it can really be a life-changing event — but it’s up to you to make sure that if you do win the lottery, you make smart choices with your lottery payments. Here’s a quick starter guide to a few do’s and don’t’s when you win it big:

Do: Consider your lottery payment options carefully.
Lottery winnings can be taken in the form of one lump sum or in lottery annuity payments, which function much like a traditional annuity agreement and pay out over a long time (usually over a period of about 25 years).

Don’t: Take the lump sum settlement just because you want to spend it without thinking.
If you’re interested in investing your winnings, you’ve been waiting to purchase a new house, or you’ve been wanting to pay off debts, then taking the lump sum might be the best option. But if you don’t have a plan for your lottery winnings first, you might be more likely to overspend without realizing it. In fact, it’s estimated that 40% of all American households overspend each year, and the average American owes about $3,761 in revolving credit — so it’s pretty easy to keep spending even after your winnings have started petering out.

Do: Have a plan for what you’d like to do with your money.
It might even be a good idea to ask a financial adviser for help! If you know how you want to spend your money, then you’ll be less likely to spend it all on things you don’t really need or want. Keep in mind that the best option might be to invest it!

Don’t: Assume that the amount you win will be the amount you take home.
You’re going to be paying interest on your lottery winnings — a lot of interest, especially if you choose to take a lottery lump sum payout. All lottery payments are taxed pretty heavily, so you’re probably going to receive about half of the amount that you’ve won.

Do: Remember that you can sell your lottery payments if you chose an annuity but want to receive a lump sum of cash.
Maybe you chose the annuity settlement because of interest rates, because you thought it would be easier to manage your finances, or because it just seemed like the best option at the time. Regardless of why you chose annuity lottery payments, it’s possible to sell these payments if you’ve decided that you need to have the cash up front ASAP. Early withdrawal fees on an annuity just aren’t worth it!

If you’ve won the lottery before, what advice would you give to someone else? Let us know down in the comments section!

3 Emotions You’ll Feel After You Receive Lottery Winnings Now

receive lottery winningsIf you won a large prize playing the lottery, then you may have been excited at first. After all, you just won the grand prize, and it may even be the largest sum of money you’ve seen in your life. But then reality hits: you won’t receive all of those lottery winnings at once but as installments for however long that might take — possibly even decades from now.

That may be disappointing to hear, especially if you were counting on that money to pay down debt or invest in your children’s futures. However, not all hope is lost: you can actually receive lottery winnings as one lump sum payment by selling lottery payments. This allows you to get the money you were counting on now rather than having to scrimp and save for the future.

Why should you receive lottery winnings now and sell annuity payments? Here are three emotions you might feel after you receive those payments in a lump sum:

  • Relief. If you’re used to living paycheck to paycheck, then the annuity payments that you’ve been receiving for winning the lottery aren’t much different, even if they are a slightly larger amount. If you’re only receiving these payments month-to-month, then you might even feel that there’s very little difference in your quality of life despite winning big. Lump sum lottery winnings can help change your life by actually making it feel like you’ve won.
  • Peace of mind. Is debt on your mind constantly? If so, you’re not alone. American consumers owe a collective $11.91 trillion in debt to lenders, with an average of $3,761 in revolving credit alone. Additionally, the average household will see about $11,244 in student loan debt, $8,163 in auto loans, and $70,322 left to pay on their mortgage. Getting a lump sum payment for your lottery prize is the quickest way to eliminate that debt and obtain peace of mind.
  • Satisfaction. Are you planning to use your lottery winnings to pay for college for your children? Do you want to send them to a better school now? Perhaps you even want to invest for yourself and your spouse by creating a retirement nest egg for the future. You could even take the whole family on vacation. Whatever you may want to do for yourself and your family, it’s possible when you receive lottery winnings all at once.

Have more questions about selling lottery payments? Get in touch with us today.