There are costs of winning the jackpot and Powerball winners share insights about unforeseen expenses.
You’ve matched the numbers, including the Powerball, and now have to claim your jackpot. Congratulations on the big win! It truly can be a life-changing event. But there are costs coming your way, for which you need to be prepared. It may not cost you a solitary dime to claim your jackpot upfront. But Powerball winners will soon realize there are some costs to winning it big.
You follow the simple and painless claim process for the size of the jackpot you’ve won. You might have to wait four to eight weeks to collect your check. And depending on how you choose to cash out, you may be paying some hefty tax percentages. But there’s a lot more to winning the Powerball than just collecting and cashing a big check. You might hire a financial advisor, for example, to help you make those cash-out decisions and navigate the details regarding lump sum versus annuity payouts.
Powerball winners share insights about having learned a few lessons along their journey. And one suggestion they often give new winners is to invest in professional guidance when it comes to handling, spending, giving, and donating your money. A financial advisor is often a good first hire to help you with understanding the best claiming process. But you may also want to contact and hire a tax attorney, a real estate attorney, and an accountant. Should you set up a trust to handle the bulk of your winnings, or should you spread your wealth across several bank accounts? Should you buy property or donate to a local charity? And before you even begin to give the cash to your family and friends, you’ll need to know about paying taxes on some of those applicable gifts. The professionals you hire to help you make the smartest decisions can cost you well over $100,000 annually. And those are just some of the additional costs of winning it big.
Some of the wealth industry experts advise Powerball winners to invest in excess liability protection. The cost of an umbrella policy is marginal in the big scheme of things, maybe $200 to $1000 each year. But having protection against lawsuits against you, frivolous or legitimate, can be a huge relief. You might be stunned at how many people show up in your life once learning of our Powerball win. And some of them may use unconventional and malicious ways to try and siphon some of your newfound wealth. Trip and fall lawsuits, personal injury, libel claims, and slander lawsuits can quickly drain your bank account.
Never mind how much you spend in just aligning yourself with the professionals. You can expect to have quite a few incidentals right out of the gate, too. When you first win, you might be the focus of local media attention. You may want to invest in new phone numbers, a hotel stay out of town for a while, or travel to visit with family for an undetermined amount of time. These expenses aren’t necessarily costly, but they’re another example of the cost of winning the jackpot.
For about $50 to $250 per hour, you might find relief in therapy. Powerball winners realize early on that taking on incredible wealth is beyond life-changing. It can also be an emotional transition, especially with close friends and family. In a way, people struggle to mourn for their old lives as well as learning how to live this new life. Having a professional therapist in your corner is probably a sound investment, even if it’s for a short while. You can avoid making emotional decisions with your money while you learn how to transition to your new position of Powerball wealth.
So, does it cost you anything to be a Powerball winner? Yes, you’ll pay a portion of your winnings in taxes and then face a host of other expenses if you want to plan ahead. There are costs of winning that come with the jackpot territory. Now that you have an understanding of what to expect when it comes to costs, all you have to do is win!