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What advice did ‘Shark Tank’ investor Mark Cuban give to the Powerball winner?
After weeks of rollovers, the Powerball drawing finally produced a winner of the $1 billion jackpot. Shark Tank’s Mark Cuban has some advice for the winner.
On Wednesday, July 19, a winning ticket was finally drawn for the $1.08 billion Powerball jackpot, which is the third largest in Powerball history. Lottery officials in Los Angeles announced that the Las Palmitas Mini Market downtown sold the lucky ticket that matched all six numbers drawn.
The winner, who has yet to step forward and claim the money, will now have to decide whether to spread out the billion-dollar prize over 30 years in annuity payments, or receive half the amount in an immediate lump sum payment, which would amount to around $558 million.
Lottery winners sometimes become losers
According to CNBC, more than 90% of lottery winners choose to get the lump sum instead of the annuity option, despite this being a much smaller amount.
This latest Powerball jackpot is a mind-boggling amount, and if the winner is not careful, they might end up like some unfortunate people who lost their winnings over time. According to the CFP Board of Standards, nearly one-third of lottery winners eventually declare bankruptcy.
Advice from ‘Shark Tank’ star
The latest jackpot winner might want to hear what Shark Tank star and self-made billionaire Mark Cuban had to say about winning the lottery. In 2016, three tickets won the $1.6 billion purse, and the investor spoke to the Dallas Morning News then about what he thought the winners should do with their new-found wealth. Here are the nuggets of financial wisdom that he shared.
Cuban's lottery advice
Hire a tax attorney and wealth manager first before you claim the money. They will help you come up with a plan for you to make the most of your riches.
Don’t take the lump sum, since you get the full amount with the annuity.
Don’t invest the money, it’s not worth the risk, especially if you have no experience in investing. Just put it in a bank and live comfortably forever.
Expect your life to change.