William Huston, AIF®, AIFA®

10 Smart Ways To Spend Your Lottery Winnings

William Huston, AIF®, AIFA®

William Huston, AIF®, AIFA®

10 Smart Ways To Spend Your Lottery Winnings

If you won the lottery today, what's the first thing that you'd buy or spend your money on? A plane ticket to your dream destination or that designer bag or pair of shoes that you've been eyeing?

On one hand, winning the lottery could mean becoming financially secure. On the other hand, it could mean a new set of lifestyle problems. So, how do you navigate this new situation?

Key Takeaways
  • Sudden Wealth comes with great opportunities as well as high stakes
  • Lottery winnings is one way to acquire great cash but one that meets most recipients unprepared
  • Reaching out to a financial advisor is the top option among apossible solutions


The contents of this article are for educational purposes only. They are not intended to be a source of professional financial advice. You will find experts on financial planning and financial management here. More on disclaimers here.

Fun fact, July 17th is National Lottery Day. For some people, this is a fun day to buy lottery tickets with the hopes of hitting a jackpot. According to ABC News, the largest lottery jackpot won in the U.S. is $1.59 billion.

If you've won a lottery, don't start spending the winnings immediately. There are smarter ways that you can make your money work for you. Here are 10 ways that you can stretch your dollar.

1. Hire A Financial Advisor

Winning a lottery means having access to a lump sum amount of money. A great investment to make would be hiring a certified financial advisor. They can help you create a proper plan of how to use your lottery winnings.

The financial advisor will inform you of the tax obligations and advise you on whether it's best to take the lump sum or receive annuity payments. Annuity payments will guarantee you full payment of the full jackpot over a specified duration of time. This can help you pace your spending.

They will also share with you ways in which you can have an enjoyable lifestyle while still investing and putting your money to good use. This way, you'll be able to meet your personal and financial goals.

To get in touch with a certified financial advisor on our team, contact us here.

2. Invest

While investing might not be the most interesting thing to think about after winning the lottery, it most definitely is the smartest thing to do. With a good investment strategy, you can be able to generate income from your investments for the rest of your lifetime.

There are many low and high risk investment options available in the market today. From bonds to stocks to mutual funds, it is important that you allocate some of your winnings into building your investment portfolio.

If you're not sure on where to get started, get in touch with one of our qualified investment advisors here for guidance on the best investment options for you.

3. Buy A Home Or Get A Second One

As you may know, the value of real estate often appreciates over time. So, if you've just won the lottery and you don't own a home yet, this would be a good time to hire a qualified realtor to help you identify a property that you'd like and purchase it.

If you're already a homeowner, you can consider getting a second home which could act as a vacation or rental home. In both cases, you'd be able to earn extra income from the guests who book your home or the tenant(s) living there.

If this is an option that you're considering and you'd like to speak to a qualified and experienced realtor, contact us here.

4. Go for a Fun Vacation

So you've always dreamt of traveling the world and visiting different cities. With the payout from your jackpot, you can finally get to check off some destinations off your travel bucket list.

Whether you'd like to visit a warm tropical island or go for a safari, the choice is yours.

If California is among your dream holiday destinations, here's a great vacation rental where you can spend your holiday.


Resthaven is a group of luxury vacation rentals that anyone can rent or even become a member by paying the traditional way or using NFTs.

With the first home being located in Venice, California, it is the perfect spot for people looking to experience luxury travel, on company retreats, on their honeymoon or simply looking for a new adventure.

This home sits on 3,400 sq. ft., has 4 beds and 4.5 baths. It's close proximity to popular tourist attractions such as Muscle Beach, Ocean Front Walk and the Venice Fishing Pier makes it the perfect home for tourists looking to explore the city.

Resthaven is a luxurious, safe and private vacation rental where you can relax and unwind away from the hustle and bustle of everyday life.

For more information on the property, get in touch with us today!

5. Pay off Your Debt

Before you get to investing or booking your dream vacation, it is important that you clear any debt that you may have. Start with the high interest debts first as they attract the most interest and then finish off with the low interest ones.

Be sure to include student loans, credit card debt, car payments and personal loans in your debt repayment plan.

There's no doubt that being debt free will help you make better investment choices as well as enable you to have more peace of mind.

Also be sure not to get into any more debt with your lottery winnings.

6. Start an Emergency Fund

As long as you're alive, emergencies and unforeseen circumstances are inevitable. Having some money tucked away in case of a rainy day is one of the best things that you can do for yourself. This will not only provide financial security for you, but will also grant you peace of mind.

If you're getting started on setting up an emergency fund, consider putting away money that can cover your living expenses for at least 6 months. Investing this money in a high yield savings account or mutual fund as opposed to a traditional savings account is a better option. This is because your money will continue gaining interest and you can also access it easily in case of an unexpected situation.

7. Save for Retirement

Many people, especially younger ones go about their lives working without thinking that one day they'll retire. As long as you're working a job, you must retire at some point. That's just a reality of life.

As a lottery winner, it is important to set up a retirement fund so that you're secure and don't have to change your lifestyle when you stop working. If you're not sure, work with a qualified finance professional so they can help you calculate how much you'll need to set aside while putting into consideration factors like inflation, medical bills and the member(s) of your family that you support.

The advisor will also help you decide the best place to put your retirement savings. Some low risk options could include mutual funds or an IRA (Individual Retirement Account).

8. Come Up with an Estate Plan

Estate planning is the process of creating a plan of how the assets of an individual will be managed and preserved in the case of death or if they become incapacitated.

If you win a lottery, an estate plan is that much important because the value and complexity of your assets will drastically change. If you have a family, it is critical that you preserve generational wealth for future generations.

In case all this is new to you and you feel overwhelmed, reach out to us here and get connected to a certified financial planner who will help you get all set up.

9. Donate to Charity

When you become financially independent, it is important to also uplift others in your community or society at large.

Some people think that all jackpot winners are greedy and selfish but that's not the case. In fact, many lottery winners in the past have made donations to charitable organizations. As a plus, you can enjoy some tax benefits in this case. Some lottery winners do care about the society and choose to donate a part of their winnings to charitable causes or organizations.

Directing a part of your lottery winnings to a cause that you're passionate about is not only noble but is also socially responsible. You could actually be the catalyst of some necessary change in society!

You just never know.

10. Consider Taking the Annuity Payment Option

If you're lucky enough to win the lottery, you can collect your prize money as a lump sum or an annuity.

A lump sum payment means that you receive your money all at once. If you opt for this option, it is important to note that taxes will be distributed over the full amount at once.

An annuity payment option basically means that you receive an annual payment spread over a number of years. As a lottery winner, this is a good payment option as it helps you regulate your spending as you receive a little at a time.


If you hit a mega jackpot, don't let lifestyle creep get to you. Live within your means and get a financial advisor and/ or an investment advisor to help you plan your finances in a way that will enjoy financial freedom for as long as you live.

It would be such a sad state of affairs for you to end up in debt after hitting a major jackpot.

Bay Street Capital Holdings

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Bay Street Capital Holdings is an independent investment advisory, wealth management, and financial planning firm headquartered in Palo Alto, CA. They manage portfolios with the goal of maintaining and increasing total assets and income with a high priority on managing total risk and volatility. Although many advisors may focus on maximizing returns, they place a higher priority on managing total risk and volatility.

Our founder, William Huston founded Bay Street after 13 years of supporting the United States' largest retirement plan ($650B) Thrift Savings Plan. He is recognized as Investopedia’s Top 100 Financial Advisors for 2021. In California, only two black-owned firms out of nineteen firms received this recognition.

In Scottsdale Arizona, Ekenna Anya-Gafu CFP, AAMS is recognized among the Best Financial Advisors for his responsiveness, friendliness, helpfulness, and detail. Bay Street was founded to advocate for diverse and emerging fund managers and entrepreneurs. In 2021, Bay Street was selected as a finalist out of over 900 firms across the US in the category of Asset Manager for Corporate Social Responsibility (CSR).








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