Unless you were hiding under a rock this winter, you surely heard about the Powerball lottery. The jackpot winnings for the January 13, 2016 Powerball lottery were a record 1.6 billion dollars. According to the Powerball lottery organization, three winning tickets were purchased this year, which still amounts to $533 million for each winning ticket.
Most people believe that when they win the lottery, their hard times are over. However, for many lottery winners, this is far from the truth. In fact, 70% of lottery winners spend all of their lottery payments in less than 5 years! In fact, almost half of all lottery winners end up remaining at the same job they had before winning. Without careful planning and the right financial advice, many lottery winners make frivolous purchases and waste their lottery winnings without setting themselves up for the future.
Where did these lottery winners go wrong? Well for one, many of them chose to take lump sums rather than a lottery annuity. The lump sum vs annuity question can be difficult for many lottery winners. While a lump sum puts all of the cash in winners’ pockets right away, many times over half of the winnings get taken by taxes. These lump sums also are often turned into annuity settlements through length and costly legal proceedings. Some winners ultimately end up selling lottery payments to pay for debts acquired shortly after winning.
For many winners, the solution to keeping as much of their lottery payments as possible was through what is known as a structured settlement annuity. Structured settlement annuity benefits are a way for lottery winners to renegotiate the terms of their lottery annuity. Often, lottery winners can get into financial trouble and need to renew or alter the terms of their lottery annuities. The easiest way out of this lottery-caused debt is selling fixed annuities and creating structured settlement annuity benefits.
What can structured settlement annuity benefits do for you if you win the lottery? for one, a structured settlement can create savings between 25 and 35% on your state and federal income taxes, depending on your location. Some annuities begin dispersing payments in about 30 days, ensuring your structured settlement annuity benefits come to the rescue right when you need them.
Lotteries and other large financial boons have the power to change your life. However, that change could be for the worse. By opting for structured settlement annuity benefits, you can ensure that your winnings or payments keep you right on track financially rather than derailing your newfound gravy train.