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.
Live within a budget.
If you are take the.5 billion prize in a 930 million lump sum, and are unable to decide between now and year-end which charities to support, it may be worth considering a donor-advised fund.There are also some tax advantages to taking the money over time, as you are taxed on the money as you receive.Take some time to figure out what you are going to do with the money and how you are going to.Anyone seeking a planner needs to be armed with the correct questions to ensure that the professional chosen is working in your interest and capable of addressing all your specific financial needs.People who use their wealth to make an impact on society are far happier than those who use it to show off to the neighbors.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.
A lottery winner has tax, estate and planning issues that they didn't have the week before.
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.
You should have the money outside of your spending budget and treat it as a separate investment.
If you make mistakes and lose all your money the first few years, you have 24 more opportunities to get it right.
When youve paid down a dollar of debt, thats a dollar you no longer owe.
Thieves And Forgers Rush In Where Big Spenders Dare To Tread.
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.People who are worth a lot of money need to guard against losing assets to creditors.If your winnings have made you suddenly wealthy, this may be the first time that you need to plan for estate tax.7 Things to Do If You Win the Lottery Open a Separate Account.Some people can't wait to cash their ticket.Separate the money from all your accounts including the checking accounts.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.Its prudent to ensure you are not an easy target.With good money management you-and your heirs-could live handsomely for many, many years.His insight has been sought by hundreds of print publications, including the Los Angeles Times, USA Today and Forbes.Then ask your advisors is to put together an investment portfolio divided half-and-half between equities (such as stocks) and fixed income (like bonds).The 2012 tax law offers more flexibility than ever before.It may be possible to rely on a variety of strategies, either separately or in combination with each other.
Don McNay, a financial consultant and award-winning writer, is an expert on managing money and one of the world's leading authorities on how lottery winners handle their winnings.
If you don't want to be badgered by requests, see my post, " How To Stay Anonymous When You Give To Charity.".
The scorekeeper for your local bowling league is not one of them.