Dealing With Lottery Winner Problems

lottery winner

When a lottery winner hits the jackpot, life changes fast. But it can also be stressful — especially in states where winnings are public. Many winners have to keep their identities secret, which can be challenging if you want to spend time with your kids or maintain relationships with old friends. Some even have to deal with strangers who are clamoring for their money. For example, a New York state senator says lottery winners are being hounded by solicitors and financial advisors who are trying to take advantage of them.

One way to avoid these problems is to hire a team of experts, including a financial advisor and tax professional, before claiming your prize. It’s important to understand how your winnings are taxed and to choose between a lump sum or annuity payments, experts say. If you choose an annuity, you will receive a series of annual payments that increase each year by 5%.

If you choose a lump sum, you’ll have more control over the money right away. You can invest it in a more lucrative investment vehicle, such as stocks. A financial advisor can help you make this decision based on your goals and other factors.