After 41 draws without a winner, the Powerball lottery jackpot has climbed to $1 billion — the seventh largest in the lottery’s history.
Even if you don’t match all six numbers, smaller prizes of $1 million and $50,000 are still in play.
If you somehow beat the odds and win a large cash prize, what happens next can be just as important as the win itself. That’s because decisions you make in the first few days can leave you vulnerable to losing or mismanaging the prize.
Here are five common mistakes experts say to avoid, starting the moment the ticket is in your hands.
1. Handing an unsigned ticket to the store clerk
Until a lottery ticket is signed, “the person who physically holds a winning ticket” can claim the prize, according to the South Carolina Education Lottery, one of the state lotteries that administers Powerball.
Participating state lotteries generally direct players to use validation tools — self-check terminals, mobile app scanners or official lottery websites — rather than relying on store staff. That guidance exists in part because store clerks have been caught stealing winning tickets.
To prevent fraud, you’ll want to sign the ticket in ink right away, state lotteries advise. It also can’t hurt to have a photocopy or photo of the signed ticket, since it can help if your ticket is lost or misplaced, according to the South Carolina Education Lottery.
2. Not keeping the ticket in a safe place
You signed the ticket, but where do you put it? Because a winning ticket functions much like cash, you don’t want to keep it in your pocket, wallet or lying on a desk in your home, says George Gagliardi, a certified financial planner in Lexington, Massachusetts.
“Holding the winning ticket before claiming it is akin to walking around town with $100 million in your wallet,” he says.
The official ticket needs a secure location. A common recommendation is to lock it in a bank safe deposit box or a personal fireproof safe or lockbox as soon as possible.
3. Telling everyone about winning
Announcing a big lottery win can invite financial requests, scams and unwanted attention, says Gagliardi. It’s often safer to keep the news within a very small circle of trusted family members.
Some state lotteries require winners to go public when they claim the prize, which is why it can help to consult a financial advisor, a lawyer and an accountant before coming forward, State Farm advises.
They can walk you through payout options and, in some states, help set up a trust that allows you to claim the prize anonymously.
4. Rushing to claim your prize
Winners are often given between 90 days and a year to claim a prize, depending on the state.
Rushing to claim it can prevent you from building the advisory team you’ll need to manage immense wealth. Without a lawyer, accountant and financial advisor experienced in large windfalls, you risk making costly decisions about taxes, investments and spending, State Farm reports.
5. Deciding on the payout too quickly
Powerball winners must choose between two payout options: a 30-year annuity worth the full listed jackpot amount or a lump-sum cash payout that is roughly half the advertised prize. For a $1 billion jackpot, the annuity would pay about $33.3 million per year, according to USAMega.com.
Each option comes with tradeoffs. The annuity provides guaranteed installments with a larger total payout over time, while the cash option gives you immediate access to a sizable sum that can be invested right away.
Your age, estate planning needs and comfort with investment risk can all shape which payout structure makes the most sense. Consult a trusted financial professional who can help you make decisions based on your individual financial situation.
It can also help to slow down before making a choice, since “you will be in an emotional state for a while, and one wants to make decisions logically, not emotionally,” says John Loyd, a certified financial planner in Texas.
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