Why you need a plan before claiming any lottery jackpot - wave3.com-Louisville News, Weather & Sports

Why you need a plan before claiming any lottery jackpot

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Bonita Taylor Bonita Taylor
Eric Whitfield Eric Whitfield
David Vernon David Vernon

LOUISVILLE, KY (WAVE) - Almost nobody plans to win the lottery, so few have a plan when they do. But a Kentucky financial planner, web columnist and author says you need to line up a team to help manage your money, before you claim your winnings.

Sell 300 winning tickets in barely a year and you'd expect Newburg's ‘Jim Dandy Food Mart' to draw scores of hopeful players when the MegaMillions multi-state lottery jackpot flirts with setting a record.

"If this wins, I'm gonna give you a couple thousand - and  you  too," Bonita Taylor told a WAVE 3 News crew Tuesday morning. The guesstimated jackpot had just topped $636 million, only $20 million shy of the top payout in March 2012, before Taylor and fellow player Eric Whitfield each bought a $1 ticket.

"It's just wishing in the wind," Whitfield said. "I could tell all my creditors, you know - they're paid."

"Winning? No, it wouldn't change me," said $2 player David Vernon.

Richmond, Kentucky based financial planner and author Don McNay isn't buying that.

"Winning changes everybody," he said. McNay cites some examples based on others' experiences in his book  "Son of a Son of a Gambler: Winners, Losers and What to Do When You Win the Lottery."

"Imagine Miley Cyrus on a bad day, with lots more money and no advisors," McNay said. "The more you can keep your privacy, the more you can keep your life."

But choose your advisors carefully.

"All day long, my phone would be blowing up with folks saying ‘hey, I'm your cousin,' Whitfield laughed.

"That's why you not only need to guard your ticket; you need a plan before you even come forward," McNay said.

Sign your name on the ticket itself. Photocopy it to prove the ticket is yours, especially if you bought it as part of an office or friends' pool.

"You need a team," McNay said. "Lawyer, accountant and tax advisor. At half a billion dollars plus, you're in the highest tax bracket, but there are ways to soften or defer some of the blows."

Make sure, however, that the advisors you hire have had experience managing more money that what you'd be bringing to the table.

"They'll understand all the nuances," McNay said. "You want some distance; this is one time you don't want family handling these-type things. You don't want to be their ‘experiment.'

As long as it's but a dream; "I want all my money right now," Whitfield said. "I might not be here tomorrow!"

About 98 percent of lottery winners share both sentiments, McNay said; and they're misinformed on both counts.

"People make mistakes; bad spending, bad investments," McNay explained. "But if you take a check every year for thirty years, you've got 29 more chances to get it right."

Moreover, the checks don't stop if the winner dies.

"The lottery is going to pay out the entire amount to somebody in your family," McNay said. "Whoever you designate."

Money may not buy happiness, but McNay believes that the happiest millionaires are those who share their bounty.

"Do well by doing good," he said. "Otherwise, all your bad habits can get magnified. If you have a drug problem – issues with drinking or sex – they'll get worse because there are no brakes in your life at that point.

Vernon and Taylor believe that they could keep their lives in gear.

"That (MegaMillions Jackpot) is too much for me," Vernon said. "Gotta help somebody-who need more than me. There's my daughter in college. There's a lot of money, and people."

"I probably give it to a lot of charities," Taylor said. "That's what we need in this world today-a lot of people being more generous."

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