Did you know that lottery play is the most popular and widely practiced form of gambling in the U.S.? With enticing games like Mega Millions and Powerball and fun scratch-off tickets, the lottery is a fun way to test your luck and see if you can win big. If you’re one of the many Americans that enjoy playing the lottery, you probably believe that hitting the jackpot is something that may never happen to you. But, it does happen and many people have been known to win large sums. So, what do you do if you do win the lottery? Read on for our lottery winning tips!
Consider selling your lottery annuity
Lottery winnings are not typically payed out in one lump sum, but are payed out as an annuity. This means you receive lottery winnings spread out over a period of time. That period of time varies depending on the annuity, but the most common lengths of time are payments over the course of 25 years or payments until death. Selling fixed annuities, such as the one you’d get from lottery winnings have many advantages. The big one being that you will get a lottery lump sum payout and will not have to wait to receive just parts of your winnings.
Pay off debt
IF you’ve ever dreamed of winning the lottery, chances are you’ve imagined using your winnings to do fun things like buy a luxury car or go on a fancy vacation. While these things may certainly be a possibility, you will not regret using your new-found wealth to pay your bills. In fact, the average American adult owes $11,244 in student loans, $8163 on their cars, $70,322 on their mortgage. This is another good reason that selling fixed annuities of your lottery winnings is a great idea. You can use the cash you receive as a lump sum payout to pay off your car, your student loan debt, outstanding medical bills, or even your mortgage. With these things out of the way, you can move on to enjoying your wealth!
Save for taxes
It is important to note that you will still get taxed even when you win big and, actually, the bigger the win, the bigger the tax. Typically, 25% or more of your lottery winnings will be withheld for federal income tax. Since this will be a large bill to pay, it is important that you put some of your money away for this special purpose and even consider hiring a professional to help you manage your money.
As you can see, winning big isn’t all fun and games. If you truly want to enjoy your wealth, it is important to take care of all of the necessities like taxes and debt first and many big winners find that selling fixed annuities is a great way to do just that. Once those important things are taken care of, you can be free to spend your extra income in any way you choose without worry!