How to Win a Lottery Jackpot
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When a lottery jackpot climbs into the hundreds of millions or even billions, a fever sweeps the nation. But there’s a lot more to consider than just the eye-popping numbers. Winners, for example, only get to keep the big prize if they follow certain rules.
The first step is picking your winning numbers, which should be random and not based on any sentimental value like those of your children or pets. Buying more tickets can improve your odds but you should also remember that each number has an equal chance of being drawn. So choose your numbers carefully, and don’t be afraid to use the same numbers as other people (though avoiding birthdays and anniversaries is a good idea).
In addition to selecting your numbers, you can also improve your odds by playing with a group. Bring together friends and family to purchase a large number of tickets. This is called a lottery syndicate and can be a great way to increase your chances of winning. Just make sure to choose a trustworthy captain who can handle the money and keep track of the tickets.
Another thing to keep in mind is that the size of a lottery jackpot is determined by how many tickets are sold for each drawing. When ticket sales are low, the jackpot is smaller. But when the tickets sell quickly, the jackpot grows to match the demand.
This is why so many people buy tickets when the jackpot gets close to a billion dollars. Even those who wouldn’t normally play the lottery may be tempted to do so. “There’s a virtuous cycle that builds as the jackpot gets bigger, and people buy more tickets, which in turn increases the probability of someone winning,” says Chartier.
But if you do win, be aware that the lump sum option for the jackpot is often less than the advertised figure. The New York lottery, for example, offers a lump sum of about half the prize amount. In the past, it has used the same framing as the multimillion-dollar jackpots it advertises — implying that you’re getting an annual payment of $1 million for 20 years.
As a result, the actual payout is usually closer to $500 million. So if you do hit it big, be sure to take some time to celebrate and then start planning how you’ll spend the prize money. Remember, a lot of this prize will go toward taxes. And that’s why it’s important to consult a tax professional when choosing how to claim your winnings. NerdWallet writers are not financial planners. This article is for informational purposes only. See our disclaimer.