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Attention, Future Lottery Winners. [View All]

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No Elephants Donating Member (1000+ posts) Send PM | Profile | Ignore Fri Nov-30-12 02:20 AM
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Attention, Future Lottery Winners.
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Edited on Fri Nov-30-12 02:31 AM by No Elephants
Apparently, there are many ways lottery winners end up wishing they never won. And some very, very big winners have ended up in bankruptcy court, worse off financially (and emotionally) than they were before they won.

The lottery advises that, before you claim your winnings, you put a team in place, consisting of at, a minimum, a lawyer, an accountant and a financial advisor. (TODAY did a spot on a guy who won $200 million who put that team in place, even though he himself is a lawyer.)

Needless to say, you don't want a financial advisor who works on commission because his or her advice will not be objective. On the other hand, finding good financial advisors who do not work on commission is no easy thing. I imagine you want one who seems prosperous, yet frugal. You sure don't want one who has been spending beyond his or her means.

I would even recommend trying to find professionals who have had prior experience with lottery winners, or at least sudden wealth. You don't want to pay someone by the hour who is almost as clueless about this situation as you are.

I would also consider a bodyguard, at least until your lottery winner fame dies down some. One big winner's brother tried to kill him. (I don't know why. Maybe he was his only living relative? And another lottery winning guy was killed. Some woman is being tried for his murder.)

Speaking of which, you'll want to make a will, too, especially if you have no close living relatives. You probably won't want all that money going to your state. Then again, maybe you do? Speaking of which, you may want to set up a foundation for your charitable giving.

While you are getting a will drown up, you should consider a pre nuptial agreement, or, if you are married, a post nuptial agreement. One lottery winner's wife divorced him right after he won, getting half his winnings in the divorce. So, Oh, and check enforceability in your state. Some of them are not worth the paper they are written on, literally.

Now, the interest on, say, $500 million, even for a week, is nothing to sneeze at. However, the FDIC does not insure but a relatively small fraction of that. So, if you plan to park the money while you put a team together, you could get badly burned by bank failure, unless you divide up your deposits among many, many, FDIC insured institutions.

I am sure there is lots more to do before you spend the first dollar on yourself.

Aren't you glad now that you didn't win this one?

No? Neither am I!

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