A lottery winner has a lot of work to do. They have to pay off debt, invest for the future and build up a decent emergency fund. Plus, they still have to go to their job and take care of their kids, if they have any. But there’s a whole other aspect of their life that they can’t seem to figure out.
Lottery winners may also need to set up trusts or other legal structures in order to avoid having their money go through the wringer. This helps them stay out of the public eye, which is important for privacy and security reasons. And they might need to hire people to manage their money for them, like lawyers, investment advisers and bankers.
Then there are the taxes. If a winner chooses to receive their winnings in annuity payments, they’ll need to report the entire amount each year on their tax return. This is also true for lump-sum payments.
Many lottery winners, including Quinnella Lemelle and Monique Coward, use their winnings to support their small businesses. But others aren’t so lucky. In one case, a truck driver who won a million dollars blew it on drugs and alcohol. He even tried to buy a new truck with the prize money but ended up having to sell it for less than half the value.
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