A LOTTERY expert has revealed a crucial phone rule that players must follow to protect their wealth if they win.
The advice comes as the Powerball jackpot has rolled over yet again to a whopping $750 million after no one won the grand prize in Saturday night’s draw.
The Powerball jackpot is currently at an estimated $750 million (stock image)[/caption]
No tickets matched the numbers for the $716 million jackpot that was up for grabs on Saturday.
They were: 11, 14, 34, 47, 51 and Power Ball 18.
It marked the 37th consecutive drawing in a row where it was missed.
The last time the Powerball jackpot hit was in California on May 31 when a lucky player scooped $204.5 million.
But when the streak is finally broken and a lucky player matches all five white balls and the red Powerball, they must make several crucial decisions, including one involving their cell phone, an expert has warned.
Michael Ashley Schulman, partner and chief investment officer at Running Point Capital Advisors, broke it down while speaking with The US Sun.
Schulman urged the potential $750 million Powerball jackpot winner to not tell anyone when they find out they’ve won, as this could lead to threats or “nefarious people” appearing in their life.
“Keep personal information private and be cautious about sharing the news of your good fortune with the public,” he noted.
This privacy focus was particularly important when considering phones and gadgets, according to the expert.
It’s something that many winners may forget about getting caught up in the excitement of the windfall.
Schulman advised the winner to go as far as to change their phone number, delete old social media accounts, and change their email and correspondence address to a separate PO box.
This ensures it’s as difficult as possible for unwanted persons to contact them, a vital step many fail to consider.
Schulman emphasized that a lot of “challenges” come from the win, including people overspending and making “unwise” estate and investment decisions.
But along with the privacy and phone advice, he gave six more pieces of advice to protect winners protect their new found wealth.
These all start with the letter ‘P’, which Schulman calls the ‘6 Ps’.
PATIENCE IS A VIRTUE
As part of the steps, the expert advised that the $750 million Powerball jackpot winner exercises patience.
“Don’t rush to claim the prize, but do check how much time you have to claim it; keep a level head and avoid making impulsive decisions,” he warned.
Lottery winnings: lump sum or annuity?
Players who win big on lottery tickets typically have a choice to make: lump sum or annuity?
The two payout methods can impact how much money you get from your prize.
Annuities pay out slowly in increments, often over 30 years.
Lump sums pay all at once but in a smaller amount, as taxes are withheld in one go. That means 24% of your prize goes to Uncle Sam right away. Many states tax winnings as well.
Annuities can provide winners time to set up the financial infrastructure required to take in a life-changing amount of money, but lump sums have the benefit of being taxed only once.
Inflation is also worth considering when making a choice, as payouts do not adjust with the value of a dollar. That means that you’ll likely be getting less valuable money towards the end of an annuity.
Each state and game pays out prizes differently, so it’s best to check with your state’s lottery to confirm payment policies. A financial advisor can also help you weigh the pros and cons of each option.
Experts have varying opinions on whether to take the lump sum or take the annuity.
“Sudden wealth can be a significant life change, so take the time to adjust and adapt.”
Next up was protection, which involves making copies and taking pictures of the winning ticket as insurance after signing the back of the ticket and leaving room the name of a trust or LLC.
Signing the back of the ticket establishes ownership and prevents any other party from claiming it when it wasn’t their purchase.
The ticket should also be left in a water and fire-proof area, ideally a small safe.
Professionals is another important part of the Ps, involving hiring qualified lawyers, financial advisors, and estate planners to manage the funds.
“Before claiming your prize, hire or speak with reputable professionals that can help and guide you such as a financial advisor who is a fiduciary that puts your interest first, an estate planning attorney for wills and trusts, and a CPA to advise on accounting, or a multifamily office that combines and coordinates all those services under one roof,” Schulman said.
Speaking with the right professionals and setting up a trust or LLC could also protect the $750 million winner’s identity.
PREPARE FOR THE FUTURE
The remaining Ps include prepare, PPLI, and Passion.
Prepare involves thinking over priorities with the new wealth, even taking a brief vacation to decide how to navigate larger decisions and consulting with the professionals.
With PPLI, that’s private placement life insurance.
It’s “an attractive wealth management and estate planning tool for qualified purchasers with private and tailored investments designed to balance with the rest of your portfolio,” according to Schulman.
Basically, it’s calculated investments to ensure the windfall is invested properly and remains relatively untouched so winners can live off of income from the dividends and ensure generational wealth.
Top lottery winners in the US
Millions dream of winning the lottery and finding fame and fortune. These are the biggest winners in US lottery history.
- Edwin Castro – $2.04 billion, Powerball, Nov. 8, 2022, in California.
- Theodorus Struyck – $1.765 billion, Powerball, Oct. 11, 2023, in California.
- Unknown winner – $1.602 billion, Mega Millions, Aug. 8, 2023, in Florida.
- Marvin and Mae Acosta from Los Angeles, California, John and Lisa Robinson from Munford, Tennessee, and Maureen Smith and David Kaltschmidt from Melbourne Beach, Florida – $1.586 billion, Powerball, Jan. 13, 2016.
- Unknown winner – $1.537 billion, Mega Millions, Oct. 23, 2018, from South Carolina.
- Unknown winner – he sued the mother of his child to keep his identity hidden – $1.348 billion, Mega Millions, Jan. 13, 2023, from Maine.
- Unknown winner – $1.337 billion, Mega Millions, July 29, 2022, from Illinois.
- Cheng and Duanpen Saephan, and Laiza Liem Chao – $1.326 billion, Powerball, April 7, 2024, from Oregon.
- Rosemary Casarotti – $1.22 billion, Mega Millions, December 27 2024, from California
- Unknown winner – $1.13 billion, Mega Millions, March 26, from New Jersey
Lastly, the expert advised that the winner take the time to consider their passions.
“Celebrate, consider positive lifestyle changes, and give thoughtfully,” he said.
Those who want to give to charity can even create a charitable foundation.
“Winning the lottery is a life-altering event. Careful planning, responsible financial management, and trusted communication are crucial to ensuring your long-term financial security, well-being, and happiness,” Schulman emphasized.
TAXING TIMES
The expert also noted that the Powerball jackpot winner won’t really walk away with $750 million.
This is the case no matter if the player elects the lump sum and gets the money up front, or if its annuity payments over several years.
That’s because the taxes on the jackpot are quite steep, something that can be easy to forget about for eager players.
“First, if you win a $750 million jackpot amount, that is the total you’d receive spread out over 29 or 30 years before taxes, and the taxes are not gentle,” Schulman explained.
“If you stick with the annuity, you’ll see regular payments, but Uncle Sam and possibly your state will tax each one at ordinary income rates.”
The federal government’s tax on the winnings in the case of the annuity is about 37% after withholding, according to the expert, and that’s before any applicable state taxes.
“A $750 million string of payments doesn’t mean $750 million in your pocket; rather it could be closer to $300 to $400 million after decades of taxation, depending on location and changing tax brackets,” Schulman told us.
For the lump sum, Schulman said the payout before taxes would only “fall between $310 and $450 million” and then after 37% federal taxes and and estimated 5% to 10% state tax, that’s really only net $175 to $225 million.
Of course, $175 million on the low end is still a life-altering prize.
With the right moves, it could set up a lottery winner for the rest of their life and create generational wealth within their family.
The biggest lottery winner in one state also made a bizarre first purchase recently with a $348 million jackpot.
Winning the lottery could also depend on where you buy your slip, according to what a professor of mathematics and computer science told The US Sun recently.
Responsible gambling
Remember to gamble responsibly
A responsible gambler is someone who:
- Establishes time and monetary limits before playing
- Only gambles with money they can afford to lose
- Never chase their losses
- Doesn’t gamble if they’re upset, angry, or depressed
- National Council on Problem Gambling – https://www.ncpgambling.org/
- Gamble Aware – www.begambleaware.org
For help with a gambling problem, call the National Gambling Helpline on 1-800-522-4700 or go to ncpgambling.org/chat
