10 Things To Do When You Win The Lottery

10 Things To Do When You Win The Lottery

If you win the jackpot in the next Lottery drawing, you won’t ever have to worry about money again–right?

Wrong.

With good money management you–and your heirs–could live handsomely for many, many years. But from the moment that you claim that prize, you will be descended upon by vultures who want a hefty helping of those winnings. And if you didn’t have smart money habits up until now, you could easily turn out to be your own worst enemy by quickly squandering the fortune.

The first precautionary step you should take between now and the drawing is to sign the back of the ticket, says Carolyn Hapeman, a spokeswoman for The New York Lottery. A lottery ticket is a bearer instrument, she explains, meaning that whoever signs the ticket and presents a photo ID can claim the prize. So if you haven’t signed the ticket and it blows out of your hand while you are waiting for a bus, or if you show it to a buddy in a bar and accidentally leave it on the counter, you’ve lost the loot.

Here are some steps to help you steer clear of additional risks. Most of them work well for other windfalls too–for example with sudden wealth that comes from an inheritance or the sale of a business.

1. Remain anonymous if your state rules permit it. Once people know you’re suddenly wealthy, you’ll be badgered by requests for handouts from everyone from charities to long-lost friends and relatives–not to mention all the financial “experts” who will be vying for your business. So check state rules to see whether you can dodge them all by remaining anonymous.

Although Mega Millions is a national lottery, rules on winner publicity vary by state. In New York, for example, winners’ names are a public record. Elsewhere it may be possible to maintain your anonymity by setting up a trust or limited liability company to receive the winnings, says Beth C. Gamel, a CPA with Pillar Financial Advisors in Waltham, MA. A client of Gamel’s who won a past lottery did that, and had a lawyer claim the prize on behalf of of the trust.
Depending on where you bought the ticket, prize winners have between 180 days and one year from the date of the drawing to claim their prize. So find out what the state rules are and plot a course.

2. See a tax pro before you cash the ticket.You have the choice between taking the prize money all at once or having it paid out over 26 years in the form of an annuity. With a lump sum payment, you must immediately pay tax on the entire amount, says Michael A. Kirsh, a financial planner in New York. With an annuity, you are taxed only as you receive the payments. People who have trouble controlling their spending might prefer the discipline of receiving the money as an annuity. But this payout form has other drawbacks, Kirsh notes. You will want to compare the effective yield of the annuity with what you could earn by taking the money as a lump sum, paying the taxes and investing the proceeds.

Another issue to consider is whether taking an annuity will leave your family without the cash they need to pay estate tax if you die before the 30-year period is up, Kirsh says. In such situations people typically buy life insurance policies to cover the estate tax bill.

You have 60 days from the time you claim your lottery prize to weigh the pros and cons. During this time, ask advisers to crunch the numbers and help you decide which type of payment suits you best.

3. Avoid sudden lifestyle changes. For the first six months after you win the lottery, don’t do anything drastic, like quitting your job, buying a McMansion, or trading up for a luxury car. Meanwhile, set aside a fixed amount for splurges—it’s only natural to want to celebrate your windfall.

Save the big purchases for later. For example, you could rent a house in the neighborhood where you were thinking of moving, before you make any commitments, says Guerdon Ely, a financial planner in Chico, Calif. If you need a new car, buy a budget model for now.

4. Pay off all your debts. There is no better investment than paying off debts. Whether it is credit card debt or a mortgage, your rate of return equals the interest rate on the loan. With today’s abysmal yields on relatively secure investments like CD's and Treasury's that’s especially true. When you've paid down a dollar of debt, that’s a dollar you no longer owe. When you invest a dollar, you can’t be sure whether it will grow or shrink.

5. Assemble a team of legal and financial advisers. In situations like this it’s very hard to know “who’s trying to help you and who’s trying to use you,” says Ely. Rather than signing on to a group of advisers that someone else has put together, he recommends handpicking your own lawyer, accountant and investment adviser  and requiring them to work together.

Carefully vet each adviser before discussing your situation. Check broker records at the Financial Industry Regulatory Authority. For attorneys and insurance agents, see whether there have been any complaints filed with state disciplinary authorities.

If you live in a small community and don’t want lawyers there to know your business, seek out a professional in the nearest large city. Names can be found on martindale.com, the nationwide lawyers’ directory that you can search by location and area of practice, and on the Web site of the American College of Trust and Estate Counsel, a group of trust and estate lawyers.

In effect, the team you put together will function as your board of directors, Ely says. You can start by having a fee-only adviser put together a long-term financial plan and running it by the group for comment. Once you've decided on a plan, they can provide checks and balances on each other. You can ask one of them to serve as quarterback, coordinating the group effort. That person can also play the “bad guy,” declining requests from people or organizations for gifts that you don’t want to make.

6. Invest prudently. Ely recommends putting the money in safe, short-term investments and not even touching it for the first six months. Then ask your advisers is to put together an investment portfolio divided half-and-half between equities (such as stocks) and fixed income (like bonds). Don’t fall for investments that you don’t understand or that sound too good to be true.

7. Live within a budget. Especially if you’re not accustomed to having a lot of money, it may take some discipline to preserve your winnings and not go on a wild spending spree. One way to restrain yourself is to only spend income–not principal. Especially in today’s investment world, “It takes a lot of principal to generate income and once you start spending principal, the principal quickly dissipates,” says Dennis I. Belcher, a lawyer with McGuireWoods in Richmond VA.

The best defense is to erect a variety of roadblocks that make it difficult, if not impossible, for creditors to reach your money and property. These asset protection strategies, as they are called, can range from relying on state-law exemptions to creating multiple barriers through the use of trusts and family limited partnerships or limited liability companies. It may be possible to rely on a variety of strategies, either separately or in combination with each other.

8. Take steps to protect assets. People who are worth a lot of money need to guard against losing assets to creditors. They include everyone from disgruntled spouses and ex-spouses to people who win lawsuits against you. If people think you have deep pockets they may look for reasons to sue. “If you win the Powerball, everyone’s going to be laying in front of your car so you can run over them so they can sue you,” says Ely. It’s prudent to ensure you are not an easy target.

9. Plan charitable gifts. You can offset the additional income from your lottery winnings with a charitable deduction. But you must make your donation by Dec. 31.

For gifts to a public charity, donors are entitled to an income tax deduction for up to 50% of adjusted gross income (AGI) for cash contributions and up to 30% for donations of other appreciated assets held more than 12 months.

If you are unable to decide between now and year-end which charities to support, it may be worth considering a donor-advised fund. With a donor-advised fund, you can make a charitable donation this year and claim a federal tax deduction for your irrevocable contribution but postpone recommendations about which charities should receive grants from the account until some time in the future.

10. Review your estate plan. If your winnings have made you suddenly wealthy, this may be the first time that you need to plan for estate tax. The sweeping tax overhaul of 2010 offers more flexibility than ever before. Each person has a $5 million limit on tax-free transfers, which can be applied during life, when you die or some combination of the two. If Congress doesn't act by the end of this year, that exclusion amount will revert to $1 million and the tax rate will increase to 55%. So if you want to share some of your largess with family and friends, this is the ideal time to do that. 

From Forbes Magazine

Why I hate TLC's Honey Boo Boo..

This is for you Lauren. I told you it was coming.

Before I really get into the weeds with this there is a reason I am posting this. I am educated well traveled and guess what I come from that area. I went thru school with Honey Boo Boo's father Michael. We all rode the school bus together.I am best friends with Mike's cousin who I will not name and no he doesn't act like them. He like me works hard and takes care of his family in normal ways. Yes I do have a accent and sometime I may use "Redneck" terms. I like to hunt, fish, ride 4-Wheelers and the such. But really people We are not ignorant stupid people down here. Most of the jobs in the United States are in the south do the research.  And if one more person tells me "Oh I know where you are from. You from where Honey Boo Boo Lives"  I think I will scream... Keep that in mind Ms. Rizzuto.  ;-).

Why I hate TLC's Honey Boo Boo..

TLC’s new hit reality series Here Comes Honey Boo Boo is the talk of the town. The series follows the Thompsons, focusing on the daily interactions between the family members and mother June's attempts to enter Alana into beauty pageants.Honey Boo Boo, a.k.a. Alana Thompson, 6, was first introduced to television audiences on TLC’s Toddlers & Tiaras early this year and since then they are considered as characters that seem copied from the DNA of reality TV.

Its actors and producers are proud of creating a show that ties Bill Clinton’s DNC speech ratings; it is of course nothing less than an honor but the show that makes them earn more than $4000 a day is watched because people like making fun of this family that lives in Georgia.

 Check out these tweets:

HipEponymousPoorGirl@SwanieChicken

Honey Boo Boo was created in a lab when a scientist accidentally spilled Mountain Dew on the pap smears of prostitutes.

10 Sep 12

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daveanthony@daveanthony

I hope I'm not the only person recommending we turn Honey Boo Boo into sausages. #HoneyBooBooSausages

10 Sep 12

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jon@senderblock23

Is Honey Boo Boo when you get diabetus from eating straight honey?

June Shannon, Honey Boo Boo’s mother, knows that people hate her and their new reality show, “Here Comes Honey Boo Boo.” That hate isn't stopping her from continuing with the TLC hit show or living their lives as they see fit.

TMZ reported on September 5 that June Shannon understands that many critics think of them as redneck trash. June Shannon also knows that many people love them.

“For every person that is hating on us, there’s three people that love us,” June Shannon told TMZ. She went on to say that “a lot of people relate to us.”

It is unknown if Joy Behar is one of the “haters.” She did have some harsh words for Honey Boo Boo. Joy Behar called the little girl “a fat kid” and “Honey Boobs Boobs.” Despite calling a little girl names, Joy Behar voiced her concern over Honey Boo Boo’s diet of junk food.

Love it or hate it, “Here Comes Honey Boo Boo” is a popular reality television show on TLC. So popular, it was watched by more people than the Republican National Convention.“I can’t watch it,” Mindy Leonard, from Warr Acres, said. “They are abusing Honey Boo Boo. I don’t hate them. I just wish they take some parenting classes and learn to feed her properly. They make folks from the south look like stupid hicks and not all of us are like that.”

Among the many crimes against humanity that TLC, this country's most socially irresponsible channel, has inflicted upon viewers, perhaps Toddlers & Tiaras is the worst. Well, until the breakout star of that show -- a precocious/annoying child named Alana but better known as Honey Boo Boo Child, who is pageant-whored-out by her obese mother, June -- got her own series. It’s appropriately titled Here Comes Honey Boo Boo.

The third episode airs at 10pm Wednesday if you want to help reduce the worth of the world by watching it. No pressure.

Listen, I understand the allure. Honey Boo Boo is a name that’s funny. It rolls off the tongue. Alana, age 6, apparently will say anything. Like, “A dollar make me wanna holler.” She’s all about money. And pageants. And winning. Oh, and drinking her “go-go juice” before each pageant, which is a mixture of Red Bull and Mountain Dew. It winds up the pudgy little girl, and she goes onstage to dance and prance and make faces that the judges truly seem to love.

As does TLC. And lots of viewers.

Which brings us back to that allure. Some people watch because they are entertained by the spectacle of it, apparently without realizing how awful and soul-crushing it is. Others -- let’s say this is you -- watch it because you get the wink-wink that TLC is giving the country and other people like you. It’s the green light to laugh at rednecks and fat people, which is how Honey Boo Boo’s mother, June, aka Mama, readily describes the family.

Everybody loves to laugh at the cliche, and reality shows love to exploit that. Like Jersey Shore. But once the cliches are in on the joke, they start pandering to the camera, and some of the joy is lost. They just become annoying because now they've taken the power we had over them -- laughing at their pathetic lives -- and are turning it into cash.

Which is probably what Mama is doing with Here Comes Honey Boo Boo. She’s already famously into “extreme couponing” and justifying a way to save money so she can send Alana to another pageant. But there is some sense here that maybe Mama is too dumb to be savvy enough, just yet, to play to the stereotype like Snooki and company. Which makes the show that much more horrifying and TLC that much more repellant.

Because this is exploitation squared, Honey Boo Boo Child. There’s no doubt that a dollar makes TLC wanna holler. Once hilariously known as The Learning Channel, it has no equals when it comes to showing the underbelly of America. And the neat trick is that everyone who watches can’t really call bullshit on the practice -- precisely because they’re accomplices in the success of selling and promoting trash.
For the longest time, this is why I never watched. I'm a big believer in the concept of “vote with your remote.” Hate it? Don't watch it. End of story.

But there’s something peculiarly reprehensible about Here Comes Honey Boo Boo. It’s not simply that Alana is going to need to melt down every cheap trophy she wins or do some extreme couponing to pay for therapy, it’s that there’s seemingly no punishment for TLC in producing this without conscience. (Yes, I know, we're well past that point with TLC. But still.)

Having caught up with Here Comes Honey Boo Boo -- after trying to put her and her family out of my mind and vacuumed from the cultural part of my soul after seeing them on Toddlers & Tiaras -- I realize I'm not as jaded as I thought. Translation: I guess I never thought a reality show would be this transparently heinous.
Mama is 33. She’s massively overweight (last count, 303 pounds -- down from 309 after a three-week “diet”). She’s involved with Mike, aka Sugar Bear, who couldn't be more Central Casting from Deliverance if you did a national search. Mike basically sits there, dumbfounded. That’s his role. In the opening credits to Here Comes Honey Boo Boo, Mama farts and laughs about it. In the last episode, one of her three overweight daughters (including one who's pregnant, of course), laughs and says: “That crust on my mama’s neck, I don’t know what it is.” Turns out it’s exactly what everyone thinks it is: an egregious amount of dirt stuck in the fat rolls of her neck.

“I ain't trying letting myself go – I just look good when I want to look good,” Mama says, unconvincingly. In one episode she tells the camera she needs to blow her nose, then takes a face cloth and does just that. Then smiles.

The show uses subtitles, because the apparent lack of education and the Georgia accents mesh together like some kind of indecipherable Scottish accent.

Is Mama a hoarder? Of course she is, with all that extreme couponing. She says it doesn't take a rocket scientist to figure out how to do it. Neither does it take a rocket scientist to figure out that this redneck exploitation is a step or four too far in our culture. But it won't stop anytime soon -- unless everyone stops watching.

And why would they? Honey Boo Boo just got a pet pig (irony lost) called Glitzy. Honey Boo Boo says, in apparent seriousness: “I hope Mama don’t eat Glitzy. She eats everything else.”
In one scene, Glitzy craps all over the dinner table. One of the daughters yells about Mama: “She was gonna eat it! It looked like a hot dog to her. A burnt hot dog.”

Yep. We're there. At that depth where no one imagined we'd go, even the cynical ones.
One of Mama’s daughters is nicknamed “Chubbs.” Another is nicknamed “Pumpkin.” The other one is pregnant. “Anna’s baby daddy ain't in the picture,” Mama explains helpfully, noting that she had Anna when she was 15. For her part, Anna tells the camera less than convincingly that she'll probably be a good, but not great, mother.

Which is encouraging.

This same episode has the family jumping on a makeshift Slip N’ Slide. “Heat and big people don’t mix, period,” says Mama.

“Rednecks take a bath, water slide and mud bath all at the same time,” Mama notes.
Honey Boo Boo hasn't been on a great roll at the pageants lately. She’s lost a few. That’s why they got her the pig. And a new pageant coach who is -- wait for it -- also ridiculously obese. The new dance number for Alana has her trying to be Elvis. “Do you know who Elvis is?” the pageant coach asks. Says Honey Boo Boo, “He’s Santa Claus’ helper."

God help us all.

So here’s the deal: You know this show is exploitation. TLC knows it. Maybe even Mama and HBB know it, deep down in their rotund bodies. Here Comes Honey Boo Boo is a car crash, and everybody rubber-necks at a car crash, right? It’s human nature.

Yes, except that if you play that card, you also have to realize that human nature comes with the capacity to draw a line, to hold fast against the dehumanization and incremental tearing down of the social fabric, even if this never-ending onslaught of reality television suggests that’s a losing effort. You can say no to visual exploitation. You can say no to TLC. And you can say no to Honey Boo Boo Child.

Somebody has to.

What do you think of “Here Comes Honey Boo Boo?” Is it good television or just a way to exploit Honey Boo Boo and her family?

Please share your thoughts and opinions in the comment section below.