Winning the lottery is not the end of the line and your worries, as there are some mistakes that can be a big setback if not an unhappy restart. We are talking about the biggest mistakes a lottery winner can make from the moment they claim their prize. Trying to protect our lottery winners from India, we have listed all the faults you should be aware of if you are a player!
What Are the Biggest Lottery Mistakes a Lottery Winner Can Make?
It may sound worrisome that there are at least 11 lottery mistakes a new millionaire can make, but not all of them apply to everyone. Our team did their best to research and brainstorm about different mistake possibilities, and some of them might suit your scenario. Give all of them at least a quick read and learn by heart the ones that make sense to you.
Choosing the Wrong Payment Alternative
There is a lot of content out there specifying that lottery winners “must” take the lump-sum payment or the annuity, considering the alternative to be completely wrong. That can be confusing, and the truth is that it all depends on you. In short, this is the most important difference between them:
- Lump-sum: Receive the whole payment in a single transfer, but with a considerable deduction that may reach 30% to 40% of the total value.
- Annuity: All the announced jackpot prize but divided in annuities that may sum up to 30 years in total.
Therefore, the option that results in the largest amount of money will not necessarily be the optimal choice for everyone. Sometimes, it makes a lot of sense to receive less but have instant access to all your lottery fortune.
What Lottery Winners Should Do Instead: Do not listen to the opinion of others and consider if your current debt, wishes, and plans fit with a single-time payment or annuities over time.
Treating the Lottery Prize As Easy Money
The saying “Easy come, easy go” is not to be ignored, as people do tend to be less cautious when they earn something easily. Even when we play the lottery online for years until winning the jackpot, a lot of money earned instantly can give the same effect.
Your chances of winning the lottery are tough, which means that it is the same as putting in really hard work to make it happen. If any lottery prize is taken lightly, that will most probably result in spending more than you should. That is one of the major mistakes a lottery winner can make, leading some of them to bankruptcy.
What Lottery Winners Should Do Instead: Consider that jackpot the reward for your really rare lucky strike and that you might never have that chance again. That should put a hold on your instincts and impulses.
Never Consulting Lottery Professionals
We do not have a strong culture of relying on consultants for financial matters in India when it comes to the lottery. Still, one of the biggest mistakes lottery winners can make is not to look for a professional to assist them in their next steps.
With an adequate lottery lawyer, you can get assistance in procedures that go from claiming your prize to allocating investments to preserve your new lifestyle and wealth. Someone who has studied the matter and possibly dealt with other winners can certainly help.
What Lottery Winners Should Do Instead: Even before claiming your prize, look for accredited professionals with a reputation that can truly help you with your new phase in life as a jackpot winner.
Telling Everyone About Your Prize
A lot of people believe they should not reveal their plans to anyone in order for them to be true. That can also work for winning the lottery, as going public with your achievement can do more than leverage envy in some people.
Even those that you are fond of might turn to you to ask for favors or money directly, and it could be really difficult to deny. Also, you might attract the attention of people with bad intentions.
What Lottery Winners Should Do Instead: Tell only those who live with you or need to know about your prize for real. Otherwise, there is no need to talk about your prize.
Overestimating the New Fortune
Achieving the jackpot or even the second prize of a popular international game such as Powerball or Mega Millions results in a really large amount of money. However, a hard change in a person’s lifestyle can easily multiply the total expenditure, even costing dozens of thousands of dollars a month!
Do not overestimate your new fortune, it can always reach an end if you do not find a way to keep it increasing with investments and avoiding unnecessary recurrent debts.
What Lottery Winners Should Do Instead: Plan your financial life, make investments, and do find enjoyment in spending your money but with care.
Ignoring Due Taxes
There are lottery taxes owed by anyone who wins the lottery above the minimum threshold, which varies if you play lotteries from abroad. In most cases, the tax applied over the jackpot is automatic and no longer due from the amount you receive. However, income taxes may apply to revenue from your investments.
In other words, someone who is not accustomed to paying taxes may oversee the new responsibilities with a big fortune. That can be a big mistake, as owing taxes to the government can put you in a tight spot.
What Lottery Winners Should Do Instead: Find at least an accountant who can help you figure out if any taxes are due and how to be ready for future ones.
Not Investing the Money Prize
Avoiding the third biggest mistake a lottery winner can make from our list will probably prevent you from committing this one as well. An investment ensures your financial safety and prevents you from spending more than you should.
There are many investment options, within and outside of India, and it surely takes some time studying to gather enough knowledge. Ideally, anyone who is not already well informed should seek assistance, as there are not only lottery scams but also investment frauds out there.
What Lottery Winners Should Do Instead: Invest most of your money to generate a relatively steady income, and if possible, only spend the passive revenue you will receive to ensure your children will also live comfortably.
Quitting Their Daily Job Too Quickly
A lottery winner’s mistake that does not always turn out bad but can be a premature decision is to quit your daily job when you claim the prize. It really does not sound right to keep working and selling our time for a small amount with a fortune in the bank, but that is not necessarily the case.
Some lottery prizes can help a lot and still not be that massive jackpot that makes us rich. Leaving your job when you might not have enough to live the rest of your life unemployed can be a really bad decision.
What Lottery Winners Should Do Instead: Plan your finances and figure out if you have enough to live without working in your current job before quitting it.
Paying for Luxury Over Debts
Buying a new house or a luxury car and spending on trips is a common scenario and plan for anyone who has won the lottery. Those can be great and still possible without committing any major mistake, but not as your priority.
If you have any form of debt, from mortgage to late credit card bills, pay everything before spending a penny. Of course, there are singular cases such as winning a lottery prize that won’t change anything in your life but afford a trip and your debts are under control. Otherwise, remember that debts can grow and put you in a situation worse than before.
What Lottery Winners Should Do Instead: If you plan to spend on superfluous items or experiences, make sure to pay off your bills first. They can grow and make you sell everything in the future if you are not careful.
Getting Greedy in the Lottery
Imagine winning ₹2 crore in the lottery and starting to spend a lot more on daily lotteries, aiming at accumulating even more prizes. Even if you play only the easiest lotteries, there is no guarantee that you will win.
There is nothing wrong with continuing to play the lottery, but leveraging your expenditure on tickets can result in a lot of loss over time and is a bad lottery winner’s mistake.
What Lottery Winners Should Do Instead: If you have won enough, consider if you still need to keep playing the lottery. If that is a yes, or even in the case of being a hobby, at least make sure it does not comprehend more than a really small portion of your revenue.
Playing Only Indian Lotteries
We do find some government lotteries in India to be fun to play and quite unique, to tell the truth. Still, there is so much lost potential when you do not play international lotteries, especially with lottery betting sites out there that do not require you to travel in order to claim your prize.
Aside from the local lottery found in your state, it makes perfect sense to buy lottery tickets online in India and participate in European or American lotteries without leaving your home.
What Lottery Winners Should Do Instead: Pick one of the best lottery sites available in India to play worldwide lotteries and give them a chance. The prizes and odds are much better than the ones found in our country.
FAQs
Follow our tips, summarized at the end of each listed mistake, and make sure to seek assistance from professional help whenever there is a substantial prize to be claimed.
Yes, especially when you consider yourself to be rich when the prize is not sufficient to pay off debt and give you a stable income. Take your time to claim any prize and reflect on your real possibilities with it.
When really close friends and relatives are aware of the most common lottery mistakes a lottery winner can make, they can help you stay in line with advice.
It is possibly not investing the money and looking for a professional to plan their finances and future.
Yes, the major problem with those mistakes any lottery winner can commit is that they can actually reduce your bank account to zero, especially if combined.
