Don't Lose Big After You Win Big: What To Do When You When The Lottery

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It's a dream millions of people across the United States share: winning the lottery. Every week, tickets are purchased and numbers are checked and double checked. Most tickets don't yield anything. A few ticket holders will win a small sum. The dream, however, is that one big jackpot. Who wouldn't want millions of dollars and the financial security that comes with it? It's fun to imagine that fancy new car you'd buy, the Caribbean vacation you'd take and that mansion you'd want to build. But the truth is, if you do ever get those winning numbers, your first stop shouldn't be a car dealer, travel agency or real estate agent. Nope. It should be to a financial adviser.

What is a financial adviser?

A financial adviser's job is exactly what it sounds like. He/she will advise you regarding your new finances. Together you will develop a plan that will help you achieve the lifestyle you desire while making sure the money lasts at least as long as you do. 

How will a financial adviser help me?

A financial adviser will help you set up a very diversified portfolio that will provide a steady stream of income, income benefits and peace of mind. He/she will make sure your portfolio lines up with your goals. Do you want to pay for college for your grandchildren? Do you want to make big purchases, such as homes and cars, more than you want to leave money for generations after you? Do you want to keep living much the way you always have, building your finances quietly as a nest egg for your children, their children and beyond? A good adviser will listen to your goals and offer advice for investments and options that will allow you to obtain your goals.

What else will my financial adviser do?

Your financial adviser knows better than anyone how tricky money can be. Therefore, he/she will likely suggest that you meet with a few other specialists as well, such as:

  • A Certified Public Accountant- Tax issues will arise when you win the lottery. You can't trust this type of situation to your cousin Fred, who is a whiz at online tax filing because he once took a four-day tax class. You need someone who can help you navigate the rules for your new-found wealth and who can advise you about tax opportunities that come with it. 
  • A Tax Attorney- Another expert who knows the ins and outs of taxes, especially tax laws. He/she will make sure you are following the rules, and by having a tax attorney already on board, you have a fully apprised expert ready to argue should any problems with the IRS arise.
  • An Estate Attorney- You're going to want someone who can help you decide how to divide your money should anything happen to you. An attorney can tell you about trusts that would prevent estate taxes for those you leave behind. He/she can also advise you regarding charitable donations and the options you have to leave your favorite cause some money when you pass. Of course, winning the lottery doesn't mean you're going to die right away, but you do want to get your affairs in order as soon as possible, even if only for your peace of mind.

Little, poor or no financial planning has caused more than one lottery winner to go broke. Don't lose everything after your big win. Dreams are fun, but it's important to keep both feet planted in reality and get some expert financial advice.