What would you do if you won the lottery? That is a question many people have considered. Many who do win stay at their jobs (48%). If you do win a large lottery, like the Mega Millions, you receive one payment and then 29 more annual payments. Each yearly payment is about 5% more than the one before it. If you do not like paying taxes, it might upset you that the government takes up to one quarter of your winnings. Some people opt instead to get a lump sum lottery payout. At the end of the day, the people who go this route do receive less than the people who have the yearly payments but for some, it makes more sense.
If you won the lottery and did not receive a lump sum lottery payout, you can still work out something so that you can have access to their money when they need it. What do they do? Anyone can sell structured settlement payments for cash. If you want to do this, you do have to show the court that you have a reason to do this.
Some Benefits of Selling Your Annuity
- Start a business. It costs a lot of money to start a business. Most new businesses that fail go under because they do not have adequate funding at the beginning. Even if you did not receive a lump sum lottery payout, you can sell your structured settlements and use that money to start a new venture. This is a great way to use your lottery winnings.
- Pay for an education. Higher education is very expensive. It is also really valuable to the people who get it. People who have at least a bachelor’s degree make a lot more than those who do not. Having structured payments can impact your ability to get any financial aid. If you or your children want to go to college, selling your annuity may be your best option. Going to college without incurring a huge student loan debt is one of the best things is the best case scenario for getting a higher education.
- Diversify your portfolio. Most financial experts recommend having no more than 25 to 30% of your assets in an annuity. If you are looking at your portfolio alone, you might opt to take a lump sum lottery payout. If you did not do this initially, selling lottery payments can be the next best option. Doing this can allow you to keep working which will make your social security fund increase and grow as you use your other funding to live.
- Pay your medical expenses. Nearly half of all bankruptcies in the United States are caused by medical bills. If you or your family have a medical crisis, you can sell your lottery annuity to pay these bills and avoid bankruptcy. Most Americans are just one medical crisis from bankruptcy. This does not have to be your fate. If you did not get a lump sum lottery payout you can use your lottery winnings to pay these bills.
- Pay off your home or make repairs or renovations. If you own your own home, you can pay off the rest of your mortgage or make any repairs or renovations you need or want to make. This can be a great way to get your dream home. Renovations and major repairs are very expensive. If you do not own a home, you can sell your annuity and buy a house you have had your eye on.
There are a lot of good reasons to accept the lottery payments as an annuity. Some people really like the security that comes with having these regular payments coming in for a long time. At the end of the day, these people do receive more of their winnings than the people who receive the lump sum lottery payment or those who sell their lottery payments.
Every person’s situation is different and unique. What works for one lottery winner may not work as well for another. You need to spend some time with the people close to you and with an accountant or financial advisor to work out the best plan for you and your situation.