I’m a lotto lawyer – lottery winners start to experience ‘real problems’ when they win over a certain amount
A LOTTERY lawyer has revealed how many winners find themselves in trouble if their payout is over a certain amount.
Andrew Stoltmann, a legal expert and lottery lawyer who represents at least 10 jackpot winners, exclusively told The U.S. Sun that the life-changing wins can often cause unexpected problems.
Stoltmann has witnessed several “lottery losers,” blow through millions of dollars.
He said that those who won tens of millions, even hundreds of millions, were more likely to encounter financial disaster than those who won a lesser amount.
Not to mention, government taxes on lottery winnings drastically slash a jackpot amount.
“If a win is only $2 million, it could be around $500,000 after taxes,” Stoltmann said.
“Don’t get me wrong, $500,000 is a lot of money.”
The lawyer continued that those who win amounts such as that in the lower single-digit millions to a few hundred thousand initially manage their earnings better.
For those who earn more — the “real problems” ensue.
“But in the same sense, the real problems tend to accumulate on people who win the lotteries over 50 million, you know, maybe 20, 25, to 50 million,” Stoltmann noted.
According to him, these earning amounts tend to overwhelm those who may not know how to manage a significant sum of cash.
It ultimately leads them to make what Stoltmann said was the first and biggest mistake he sees from his “lottery losers” — taking the lump sum option instead of annuity payments.
Lottery winners are always given the choice of jackpot winnings to take the entire total (with tax deduction) or smaller payments every year for a determined period — maybe 20 or 30 years.
In the case of winning large sums anywhere from $50 million to $1 billion, Stoltmann said that he sees the majority of people take the lump sum, which can lead to disaster.
“90% of all lottery winners take the lump sum distribution,” Stoltmann said.
Although he continued that those winners “don’t have the infrastructure” to handle the money.
“They tend to be from lower socioeconomic backgrounds,” Stoltmann said, noting that financial education can be relatively low.
“So they then take this massive sum of money and they just don’t really know what to do with that.”
“It’s a pretty big mistake,” the lawyer added.
With the annual payments instead, winners who obtain considerable amounts of money can make mistakes and not lose their whole fortune in the process, according to Stoltmann.
The lottery lawyer’s advice to avoid mistakes altogether is immediately hiring a “bad guy” accountant before cashing a ticket.
Stoltmann said that the accountant acts as a “bad guy” in keeping family members or friends who might have plans for a piece of the winnings at arm’s length.
They also prevent winners from careless spending on big-ticket items that make funds disappear fast.
For more related content, check out The U.S. Sun’s coverage of the six crucial errors another lottery lawyer says winners typically make.
The U.S. Sun also has the story on what a lottery lawyer says winners must do to avoid losing over half of their jackpot.
