In 2002, a man named Jack Whittaker won the $314 million Powerball jackpot. It was the largest jackpot in lottery history. He was a construction worker from West Virginia who had an outsized personality. The story of his life should serve as a cautionary tale for lottery winners. Whittaker reveled in his newfound wealth and used it to give handouts to church members, diner waitresses, and family members. He also donated money to a strip club.
The stories of lottery winners soon became a staple of human-interest publications. However, many of these winners were beleaguered, broke, or otherwise messed up. This negative stereotype continued even after the lottery industry was legalized in the United States. Among the most famous examples of lottery winners who spent their money horribly is the case of Newburyport, Massachusetts in 1883.
While winning the lottery may feel like a dream come true, winning big on the lottery can also draw greedy relatives, con artists, and charity cases. It is difficult for lottery winners to get out of their own way, and irresponsible spending can leave them worse off than they started. In some cases, it may even be in the person’s best interest to avoid such temptations.
A lottery winner can choose to claim his prize anonymously, or they can choose to accept a lump sum payment. The lottery winner must present his or her signed ticket to a lottery staff member. If he or she chooses the lump sum payment, they can receive a $1 billion annuity over the course of 29 years or a lump sum payment of $602.5 million. If the winner chooses the latter option, he or she will have to learn about tax withholdings and the timing of wire transfers to the bank.