Let’s face it: everyone thinks that winning the lottery would make all of their problems disappear, and to be sure, having a large amount of cash in your hands can be an exciting feeling at the very least. It can also help you pay off things like credit card debt and student loan debt, or it can help you buy a new house or a new car. It could even allow you to take an awesome vacation to the Caribbean — and end up staying there, opening your own business, and finding perpetual bliss.
But in reality, lotto winners typically find that life isn’t all peaches ‘n cream. Instead, they end up facing a few harsh realities that suggest life was way easier before winning the lottery:
- After winning it big, about half (48%) of all lotto winners end up working, or going back to work in just a few years.
- The government can end up taking up to 25% of jackpot lottery winnings through fees and taxes; because the taxes on lump sum lottery payout are higher than with a lottery annuity, many winners decide to go with the annuity.
- But still, picking the annuity option isn’t always the best choice. With the Mega Millions jackpot, for example, the money is paid out over 29 years in small installments. Even though a 5% increase is included in payments each year to adjust for inflation, many people find that it isn’t really enough.
For these reasons, many winners end up selling lottery payments and trading them in for a lump sum of cash. If you’re interested in selling your annuity payments after you chose this option — and you regret not taking the lump sum instead — it’s pretty easy to find a service that will work with you. Selling your annuity payments can be pretty scary after you’ve won the lottery, but it’s definitely the best option for quite a few people.
