Tuesday, September 25, 2018
Business

Lottery winner minefields: Financial planning, emotions, relationships

The biggest challenge for lottery winners isn’t the massive sum of money suddenly dropped into their lap — it’s everything else that comes with it.

"They’re going to be pulled in a lot of different directions," Steve Athanassie, financial planner, said. "Dealing with the emotional side is the biggest challenge."

Shane Missler, a 20-year-old man from Port Richey, claimed the $450 million Mega Millions jackpot Friday. The Jan. 5 pot is the fourth-largest in Mega Millions history, and the second-largest claimed by an individual.

Related coverage: Florida man, 20, claims $450M Mega Millions jackpot

The first thing Missler, who since quit his position at a background screening company, will have to deal with is wrapping his head around his nearly-unfathomable fortune, Athanassie said.

Athanassie’s firm has worked with lottery winners in previous years. The stress of coming into such winnings is often overwhelming, especially for someone young who hasn’t dealt with large sums of money before.

For previous lottery-winning clients, "it was almost like a look of fear," Athanassie said, "because you all of a sudden have this lump sum that you’re not sure what to do with."

A team of experts, he said, can help with that. The first few things that need to be taken care of are basic: hire a lawyer, an accountant and a financial advisor and begin making arrangements for managing the money. Then comes setting up trusts, investments and potential philanthropic ventures.

Proper management is especially important for clients like Missler who opt for a lump sum. One big check immediately — instead of a smaller check every year — will pay out the greatest amount, which is an ideal option for someone who knows how to manage and grow it. In Missler’s case, that’s $281.9 million — $211.4 million after taxes.

But it also comes with risk. Having all of the winnings in hand means if the funds are mismanaged, there’s nothing to fall back on.

"You think it’s more money than you could spend," Athanassie said. "Believe me — you could spend it. And people have."

Taking the yearly payout option is often prudent for someone who isn’t as skilled at finances yet.

"If you’re taking an annual amount, the worst you could do is spend everything for that year," he said. "Maybe by the third or fourth year you realize you’ve made some bad decisions."

And then there’s the interpersonal minefield.

"Young people tend to be more open to suggestion and tend to trust people a lot more than after you’re older and you’ve been burned a few times," said Rhonda Holifield, a financial adviser with Prosper Financial Advisers.

Missler, like other winners, will likely deal with an onslaught of family, friends and strangers coming out of the woodwork for a piece of the pie. Learning who to trust — and learning quickly — will be vital.

"He is easy pickings now for somebody that looks at him and sees deep pockets," Holifield said.

One consideration that will be important down the line for the young winner is securing his funds if he decides to get married.

A prenuptial agreement can protect the winnings, which would be considered solely his because he won them before marriage.

Missler said he plans to move out of Tampa Bay and "(educate) himself to be a good steward of this fortune."

"I intend to take care of my family, have some fun along the way and cement a path for financial success so that I can leave a legacy far into the future," he said in a Friday statement.

Contact Malena Carollo at [email protected] or (727) 892-2249. Follow @malenacarollo.

Comments
Tampa Bay Whole Foods can now deliver through Amazon Prime Now

Tampa Bay Whole Foods can now deliver through Amazon Prime Now

Tampa Bay Whole Foods Market shoppers can finally get organic goodies delivered to their homes in a few hours as members of Amazon Prime. Amazon announced today that Whole Foods has added Tampa, nine other metro areas and parts of Seattle and New Yor...
Updated: 9 hours ago
FEMA rolling out new flood zone maps for Tampa Bay counties

FEMA rolling out new flood zone maps for Tampa Bay counties

Thousands of Tampa Bay-area property owners could soon find themselves with new flood zone designations on their homes and businesses.The Federal Emergency Management Agency has completed a years-long study to update flood zone maps in Hillsborough, ...
Updated: 5 hours ago
Rep. Charlie Crist urges federal consumer watchdog to investigate Marlin Financial

Rep. Charlie Crist urges federal consumer watchdog to investigate Marlin Financial

U.S. Rep. Charlie Crist is calling for the federal Consumer Financial Protection Bureau to investigate Marlin Financial, saying he was "disturbed" by a recent Tampa Bay Times’ investigation into the online auto finance company. In a letter Tuesday af...
Updated: 8 hours ago
Dunkin' to drop Donuts, change name in January

Dunkin' to drop Donuts, change name in January

Dunkin' is dropping the donuts — from its name, anyway.Doughnuts are still on the menu, but the company is renaming itself "Dunkin'" to reflect its increasing emphasis on coffee and other drinks.The change will officially take place ...
Published: 09/25/18
Struggling against Red Tide, a Redington Beach liquor store is too small to qualify for local aid

Struggling against Red Tide, a Redington Beach liquor store is too small to qualify for local aid

REDINGTON BEACH — Mark Wilson hasn’t had a customer for hours.As the only liquor store on his stretch of Pinellas County beaches, Wilson is used to a steady stream of tourists from the nearby condos and hotels. Other beachfront businesses affected by...
Published: 09/25/18
Weight Watchers slims its name down to WW

Weight Watchers slims its name down to WW

Weight Watchers is its dropping its brand name in exchange for something slimmer: "WW." The company says the new logo - coupled with the tagline "Wellness that Works" -- puts an emphasis on overall health and well being, with less...
Published: 09/24/18
Study: Some Tampa Bay neighborhoods among quickest selling in the state

Study: Some Tampa Bay neighborhoods among quickest selling in the state

Tampa Bay sounds like a home seller’s dream market — even compared to other locales statewide. According to a recent study by SmartAsset, four of the top 10 easiest places to sell a home in Florida are in the bay area. Northern Hillsborough County ac...
Published: 09/24/18
Lower demand brings slight dip in gas prices across state, Tampa Bay

Lower demand brings slight dip in gas prices across state, Tampa Bay

Just in time for fall, pump prices are finally declining. Gas prices in Florida averaged $2.72 per gallon Monday, down from $2.74 per gallon a week ago, according to AAA, The Auto Club Group. Tampa Bay prices were even lower at $2.63 per gallon, down...
Published: 09/24/18
SiriusXM to buy Pandora for $3.5 Billion in bid to expand reach

SiriusXM to buy Pandora for $3.5 Billion in bid to expand reach

Satellite radio provider Sirius XM said Monday that it would acquire music streaming service Pandora Media for $3.5 billion in a bid to corral listeners who do not want to pay for premium channels.Pandora rose to success by providing tailored radio s...
Published: 09/24/18
Jeff Vinik invests in gaming headset maker boosted by Fortnite’s popularity

Jeff Vinik invests in gaming headset maker boosted by Fortnite’s popularity

TAMPA — As a mutual fund wonder-boy, hedge fund manager and real estate investor, Jeff Vinik has long displayed a sense for knowing when to put money into the next big thing, and his latest bet on e-sports may be no different.Vink recently bought nea...
Published: 09/24/18