America’s billionaires will welcome a new member to their rarefied club tonight when numbers are drawn for the $1.5 billion Powerball prize that has captivated the nation. That winner, who most certainly won’t be you, will likely have no clue what to with the money.
Fortunately, super-rich Shark Tank star Mark Cuban has some advice.
1. Hire a tax attorney first.
2. Don’t take the lump sum. You don’t want to blow it all in one spot.
3. If you weren’t happy yesterday you won’t be happy tomorrow. It’s money. It’s not happiness.
4. If you were happy yesterday, you are going to be a lot happier tomorrow. It’s money. Life gets easier when you don’t have to worry about the bills.
5. Tell all your friends and relatives no. They will ask. Tell them no. If you are close to them, you already know who needs help and what they need. Feel free to help SOME, but talk to your accountant before you do anything and remember this, no one needs 1m dollars for anything. No one needs 100k for anything. Anyone who asks is not your friend.
6. You don’t become a smart investor when you win the lottery. Don’t make investments. You can put it in the bank and live comfortably. Forever. You will sleep a lot better knowing you won’t lose money.
We’ll resist the urge to poke holes in his “money doesn't make you happy” theory, which is exactly the kind of nonsense someone without money problems says, and instead evaluate his second point, which is pretty controversial.
It turns out that nearly everyone who wins the lottery takes the lump sum. They want that bank account to be fattened post haste. But Cuban suggests that the winner of this jackpot take the annual payments.
That would prevent a spectacular loss, he suggests, and another depressing episode of Lottery Changed My Life. The New York Times chimed in with a similar argument that boils down to this: annual payments are better because there’s a tax advantage and they make this whole winning the lottery thing much harder to screw up.
Really, it doesn't matter though. Whoever wins this thing—sorry again, but it definitely won't be you— will be unthinkably rich either way. So if by some stroke of luck you happen to know the winner, pass this along.