Wednesday, October 17, 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
HSN to cut hundreds of workers as it merges with QVC under new ‘QXH’ business unit

HSN to cut hundreds of workers as it merges with QVC under new ‘QXH’ business unit

ST. PETERSBURG — Hundreds of HSN employees are losing their jobs as their parent company combines the local shopping network with long-time rival QVC under one operation with shared resources.HSN and QVC will maintain their brand identities, but are ...
Updated: 5 hours ago
Man files suit against Diocese of St. Petersburg saying a Tampa priest sexually abused him in the 1980s

Man files suit against Diocese of St. Petersburg saying a Tampa priest sexually abused him in the 1980s

ST. PETERSBURG — A former parishioner of Christ the King Catholic Church in Tampa, now a lawyer and magistrate in the Virginia Supreme Court, has filed suit against the Diocese of St. Petersburg alleging that he was sexually abused as a child by a no...
Updated: 6 hours ago
After hauling away nearly 1,000 tons of dead fish, Pinellas County sees Red Tide scourge easing

After hauling away nearly 1,000 tons of dead fish, Pinellas County sees Red Tide scourge easing

Pinellas County is nearing 1,000 tons of total collected dead fish since Red Tide exploded into the Gulf coast last month. But based on an update to local tourism officials Wednesday, the smelly situation has improved."We are in a good place with win...
Updated: 7 hours ago
Canada now world's largest legal marijuana marketplace

Canada now world's largest legal marijuana marketplace

MONTREAL (AP) — Ian Power was among the first to buy legal recreational marijuana in Canada but he has no plans to smoke it. He plans to frame it.Canada became the largest country with a legal national marijuana marketplace as sales began earl...
Updated: 10 hours ago
They’ve met 475 Tuesdays in a row to help real estate pros rebound from the housing crash

They’ve met 475 Tuesdays in a row to help real estate pros rebound from the housing crash

TAMPA — A decade ago this fall, the U.S. economy was in crisis. The investment firm Lehman Brothers collapsed in the biggest bankruptcy in U.S. history. Major banks were about to fail. The stock market plunged. And in Florida, "real estate stopped co...
Published: 10/17/18
Dr. BBQ opens to the public today. Here’s a look.

Dr. BBQ opens to the public today. Here’s a look.

ST. PETERSBURGDr. BBQ needed a beer. Mission accomplished: A sip of Green Bench’s Dr. BBQ Pale Lager dispatched, he was ready to start the tour. See that teal tufted couch against that wall? It’s like something from Girl & the Goat in Chicago. The wo...
Published: 10/17/18
Report: Tampa drivers pay different insurance rates based on ZIP code

Report: Tampa drivers pay different insurance rates based on ZIP code

It can be tough to figure out why insurance companies charge some more than others for auto coverage. But a recent analysis by the Consumer Federation of America suggests that a driver’s neighborhood could be a factor. The analysis, released Monday, ...
Published: 10/17/18
As drug prices soar, drugmakers keep setting records for campaign donations

As drug prices soar, drugmakers keep setting records for campaign donations

Before the midterm elections heated up, dozens of drugmakers had already poured about $12 million into the war chests of hundreds of members of Congress.Since the beginning of last year, 34 lawmakers have each received more than $100,000 from pharmac...
Published: 10/17/18
Mum’s the word but Murman’s a player in departure of Glazer Children’s Museum leader

Mum’s the word but Murman’s a player in departure of Glazer Children’s Museum leader

TAMPA — Jennifer Stancil was looking forward to Halloween and the role she would play in a new downtown event celebrating the spooky holiday."WE ARE SO EXCITED to be a partner with the Riverwalk for Halloween," Stancil, president and chief executive ...
Published: 10/17/18
Giant law firm Baker McKenzie picks Tampa for business services center with 300 new jobs

Giant law firm Baker McKenzie picks Tampa for business services center with 300 new jobs

TAMPA — Baker McKenzie, a global law firm with 13,000 employees in more than 40 countries, said Wednesday it would open a new business services center in Tampa with more than 300 new jobs by early 2020.The hub will provide support to the firm and its...
Updated: 9 hours ago