Sunday, January 21, 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 mcarollo@tampabay.com or (727) 892-2249. Follow @malenacarollo.

Comments
Free clinics respond as more people head to the ER with dental problems

Free clinics respond as more people head to the ER with dental problems

Charles Lee had been dealing with an excruciating toothache for days. The pain made it hard to eat or sleep or focus on work. But Lee, 54, didn’t have dental insurance. His job as a delivery truck driver offered only a supplemental policy that was to...
Published: 01/22/18
Tampa Bay jobs chief Ed Peachey making top dollar

Tampa Bay jobs chief Ed Peachey making top dollar

For years, Edward Peachey has bragged about the number of jobless people he has helped find work.As president and CEO of CareerSource Pinellas and CareerSource Tampa Bay, he’s in charge of the two main government agencies that provide training to the...
Published: 01/20/18
Sunday Conversation: Lightning VP Keith Harris strikes a chord for the Boys & Girls Clubs

Sunday Conversation: Lightning VP Keith Harris strikes a chord for the Boys & Girls Clubs

Keith Harris fondly looks back on some memorable days from his Tampa upbringing when he worked as a lifeguard at a pool next to a Boys & Girls Club. ¶Whenever it rained, he watched as the kids retreated to the safe haven of the club. They entered int...
Published: 01/19/18
Updated: 01/21/18
Inspector General launches investigation into Tampa Bay’s local career centers

Inspector General launches investigation into Tampa Bay’s local career centers

The state has opened an investigation into CareerSource Pinellas and CareerSource Tampa Bay, days after the Tampa Bay Times asked about whether the two regional job centers were inflating the number of people they had helped get hired. The agencies, ...
Published: 01/19/18
Tech firm TranferWise moves to Ybor City, illustrating a new chapter in Tampa’s business history

Tech firm TranferWise moves to Ybor City, illustrating a new chapter in Tampa’s business history

TAMPA — You could sketch an economic history of the city of Tampa — and maybe get a glimpse of its future — just by looking at the old J. Seidenberg & Co./Havana-American Cigar Factory.It opened in 1894, making it Ybor City’s second-oldest brick ciga...
Published: 01/19/18

Want to buy into an exchanged-traded bitcoin fund? You might have a long wait

NEW YORK — It may be a while, if ever, before investors can buy an exchange-traded fund made up of bitcoin and other digital currencies. Federal regulators have a long list of questions they want answered before they’ll approve a digital currency fun...
Published: 01/19/18
Child psychologist weighs in on mom who charges 5-year-old ‘rent’

Child psychologist weighs in on mom who charges 5-year-old ‘rent’

A Georgia mother has gone viral for charging her 5-year-old "rent." Yup — the kid pays up for food, water, cable and electric, too.Essense Evans described in a Facebook post how she handles her daughter’s allowance. The post, written on Saturday, was...
Published: 01/19/18

Addicted to your smartphone? Now there’s an app for that

Did you text? Sorry, I can’t see messages right now. Arianna Huffington locked my phone.The media tycoon turned wellness entrepreneur wants to keep you out of your phone, too, with a new app called Thrive. Its goal is to make it cool for a generation...
Published: 01/19/18
Proposed monument near St. Pete pier would honor Tony Jannus history-making flight

Proposed monument near St. Pete pier would honor Tony Jannus history-making flight

ST. PETERSBURG — Tony Jannus’s history-making flight in an early seaplane — simultaneously as ungainly and graceful as a pelican on the wing — is what Mayor Rick Kriseman calls an "under-told and under-appreciated" story, but a team of local history ...
Published: 01/19/18
Learn how bus rapid transit (and rail) could work in Tampa Bay

Learn how bus rapid transit (and rail) could work in Tampa Bay

ST. PETERSBURG — The newest hope for transportation in the Tampa Bay area is a bus rapid transit system projected to cover the 41-miles separating St. Petersburg from Wesley Chapel and attract 4,500 new riders at a fraction of the cost of light rail....
Published: 01/19/18