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Can I Sell My Lottery Payments for a Lump Sum?
This is a guest post.
Winning the lottery is everyone’s dream. You hit the lotto, cash in your ticket and kiss all your troubles goodbye, right? Actually, that might not be true. Just look at the number of lottery winners who’ve ended up worse off than they were before they hit it big. There are several problems here. One problem is that people often spend their money unwisely, without learning how to manage it properly. Lottery annuity payments were designed to help with this. However, those annuity payments might not actually be enough to make a significant difference in your life. If that’s the case, you might be wondering if you can sell your payments for a lump sum. The answer is, yes, you can. But there’s a catch. Actually, there are a couple of catches.
Buyers Matter
First, let’s talk about buyers. They’re the ones who’ll be paying you a lump sum for your lottery payments. Now, you can’t expect a buyer to offer the full amount you’re owed from the lottery, but you should be able to expect a significant percentage of the winnings. That’s not the case with many buyers. They recognize your desperation and have no qualms about taking advantage of your situation. That’s not true for all buyers, though. You need to recognize qualified buyers from those better left alone. Obviously, that’s tough to do on your own. Most people have never been in the position of having to sell lottery payments before, and it’s easy to get lost in a world with which you’re not familiar.
Sell Only Part of It
Another important consideration is whether you need to sell all of your lottery winnings or only a percentage of them. You can easily sell just a specific portion of your winnings, enough to cover your immediate needs, and retain the remainder as regular ongoing payments. This ensures that you have the money you need right now, as well as a financial cushion for the future.
Work with a Go-Between
The ideal solution to your quandary is to work with a firm that acts as a go-between. The company will vet and investigate buyers, ensuring that you only have the cream of the crop to choose from. Not only that, but working with a reputable firm will also ensure that you get the highest percentage possible of your winnings, rather than leaving you with a mere pittance.
Of course, not all such firms are the same, and you need to recognize a reputable company. Look for a firm that’s been in business for a number of years – one with an established reputation and a list of satisfied clients. Second, make sure the company doesn’t work for the buyers – the firm should work for you, the seller. This ensures there’s no conflict of interest. A company that works on behalf of the buyer has no incentive to go above and beyond to ensure you get a fair deal. One that works for you certainly does.
Saturday Roundup
- Image via Wikipedia
Last weekend, we had 2 birthday parties. In two weeks we are having our biggest party of the year. I’m going to try to get our yard done this weekend, while my wife and a couple of her friends decorate inside the house. October is still nuts at Casa del Myhouse.
Today, I found out that I accidentally made a huge extra payment to my car. $650 too much. I thought I had deleted the auto-payment series from the bank’s site, but I only deleted September’s payment. Hopefully, I can find enough slack in the bills to make up the difference, instead of hitting the emergency fund.
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The best posts of the week:
J. Money’s doing a series on side hustles. The latest one is about chicken farming. If I lived in a more reasonable city, I’d have some chickens of my own.
Self-improvement is always good for you, kind of by definition. Here are a few ways to pick up some interesting certifications.
Lifehacker posted on Squaretrade. I can tell you that, without a doubt, I’ll never again get an extended warranty in-store.
A Moment of Clarity
- Image by Matt Stratton via Flickr
Ten years ago, I buried myself in debt. There was no catastrophic emergency or long-term unemployment, just a series of bad decisions over the course of years.
We bought a (short) series of new cars, a house full of furniture, electronics, hundreds of books and movies, and so much more. We threw a wedding on credit and financed an addition on our house. We didn’t gamble or drink it away, we just spent indiscriminately. We have a ton of stuff to show for it and a peeling credit card to prove it.
What changed?
In October 2007, we found out brat #3 was on the way. Don’t misunderstand, this was entirely intentional, but our…efficiency caught us by surprise. It took several years to get #2. We weren’t expecting #3 to happen in just a couple of weeks. #2 wasn’t even a year old when we found out she was going to be a big sister. That’s two kids in diapers and three in daycare at the same time.
The technical term for this is “Oh crap”.
I spent weeks poring over our expenses, trying to find a way to make our ends meet, or at least show up in the same zip code occasionally.
I finally made my first responsible financial decision…ever. I quit smoking. At that point, I had been smoking a pack a day or more for almost 15 years. With the latest round of we’re-going-to-raise-the-vice-tax-to-convince-people-to-drop-their-vices-then-panic-when-people-actually-drop-their-because-we-made-them-too-expensive taxes, I was spending at least $60 per week, at least.
Interesting side story: A few years ago, Wisconsin noticed how many Minnesotans were crossing the border for cheap smokes and decided to cash in by raising their cigarette taxes. The out-of-state market immediately dried up. Econ 101.
So I quit, saving $250 per month.
Our expenses grew to consume that money, which we were expecting. (Remember, we were expecting a baby!) Unfortunately, our habits didn’t change. We still bought too much, charged too much on our credit cards, and used our overdraft protection account every month. At 21% interest!
Nothing else changed for another year and a half. My wife would buy stuff I didn’t like and we’d fight about it. I’d buy stuff she didn’t like and we’d fight about it. When we weren’t arguing about it, we’d just silently spend it all as fast as we could.
Bankruptcy was looming. We had $30,000 on our credit cards and our overdraft protection account was almost maxed out. Have you ever thought you’d have to sell your house quickly?
One day, while I was researching bankruptcy attorneys, I ran across Dave Ramsey. When I got to daycare that evening to pick up the kids, I noticed they had The Total Money Makeover on the bookshelf, so I asked to borrow it.
I read the book twice, had a very frank discussion with my wife about the possibility of bankruptcy, and we set out on the path to financial freedom together.
What made you decide to handle your finances responsibly? Or, perhaps more importantly, what’s holding you back?
Payday Loans Suck
- Image by vonglee via Flickr
A few weeks ago, I was approached about placing ads on this site. I was excited when I read the email. It came from a real domain, didn’t involve any Nigerian princes or wire transfers for overpayments.
Over the course of the email conversation, it was determined that, for a fee, I would place some links in a few archived posts. It would just be links to improve search engine ranking, without being an eyesore for my current readers. I don’t have a problem with that. The intrusiveness is similar to Chitika ads, which are only visible to search traffic. It’s a nice way to advertise: monetization without alienation.
Then I saw the links. I was being offered money to promote payday loans.
Payday loans offer to loan you–for example–$100 for the low(snort) price of just $25. That’s not bad. Only 25%. I know some credit cards that aren’t that good. The catch is that the loan is due in full in 2 weeks. That gives it an APR(Annual Percentage Rate) of 650%. That’s not so good.
When you payback the loan, your paycheck is pre-spent by whatever you borrowed, plus the pound of flesh fee and you are that much more likely to need their services again, digging you even deeper.
It’s not like the target demographic is terribly affluent. These are people who not only can’t make ends meet, but also can’t acquire traditional credit. They are left paying this insulting fee.
I consider payday lending companies to be immoral, unethical and generally, more than a bit dishonest. These are the people who give decent, hardworking capitalists a bad name. I’d rather go to a mob loan shark. He’s at least honest about what he is.
They got shot down.
Don’t get me wrong, I enjoy making money. I also enjoy the money I make here.
But not at the expense of my soul or my integrity.
Counting Cards: How to Cheat At Blackjack
I don’t gamble much. I’ve got this boring kind of luck that let’s me gamble for a really long time on not much money, without ever winning big.
For example, when my wife was very pregnant with our first monster, we took a trip to visit my parents. It’s a 2 hour drive, and she needed a break halfway there. In the truck stop, we bought $5 worth of scratch-offs to pass some time. We turned in the winning tickets for more scratch-offs. And again. And again. Two hours later, we were out of winners, but had never accumulated more than $10.
Another time, we went to the casino to play slots. It took nearly 8 hours to spend $20. That sounds boring, but we had good conversation while we were playing.
I’ve never had a big win or a big loss from gambling, so I’ve always been kind of bored with the idea.
Now, cheating at blackjack, that’s a different matter. Pulling one over on the casino without getting caught…they make movies about that kind of stuff.
To be clear: counting cards in your head isn’t cheating. Legally, the worst that can happen is you can be asked to leave. To get a Hollywood-I-cheated-the-casino-and-got-caught-and-beat-by-the-mob kind of beating, you need to win a lot.
A lot.
To get started, there are a few things you need to know. One of those things is how to play blackjack, but I’m not going to get into the basics. If you don’t know how to hit, stand, or count to 21 without taking your clothes off, this guide may be too advanced for you. Come back later.
Super Basic Strategy
You don’t need to count cards to use this strategy. You will do better than most players if you follow along.
1. The dealer must hit, or take another card, if he has 16 points. If he has 17, he stands.
2. The hole card–the card you can’t see–is always worth 10. Of course, it’s not, but for the purposes of your strategy, assume it is.
That means, when the dealer is showing a 2, you’ll assume he’s got 12 points and will hit. If he’s showing a 7, you’ll assume he’s going to stand. If he’s showing an 8, your goal is to beat 18, not push for 21.
That’s it. If you do that, you’ll come within a couple of points of even odds against the house. Google “blackjack basic strategy” if you want to improve this.
Even odds isn’t good enough.
Card Counting
Counting cards sounds tough. Rain Man tough.
It’s not, but you’ll want to practice at home a bit before you try it in the really real world.
The rules are simple:
1. Cards 2-6 are worth 1 point.
2. The 10, jack, queen, king, and ace are worth -1.
3. For every card that is played, keep track of that score. This is a running score across multiple hands until the deck is replaced or shuffled, so don’t stop at a new deal.
4. Divide the running score by the number of decks remaining in the shoe. If there are approximated 150 cards in the dealer-thingy, that’s 3 decks, so divide by 3. If your running score is 18, that means the number your playing against is 6. If the casino is using a continuous-shuffling thingy, forget counting the cards.
That’s it. You’re never adding or subtracting more than a one, and you’re doing that against a number that tends to stay pretty low.
How do you use that, you ask? Easy.
When the score is up, bet higher. If it’s low or negative, bet lower. The higher the number, the higher your bets. If you’ve got a 5, a 6, or more, bet as much as you are comfortable with. If your playing score is low or negative, bet close to the table minimum.
Why does this work?
A higher score indicates that the main assumption of the super basic strategy is more likely to be true. When you’ve got a score of 10, you know a lot of lower-value cards have already hit the table, so it’s safer to assume that the dealer’s card is worth 10.
You don’t change anything about the way you play each hand, you just change the way you bet each hand. Counting cards doesn’t tell you specifically what’s going to happen during each hand, it just tackles the statistics of the game. It moves the odds in your favor, by up to 2 or 3 percent. Over one hand, this won’t help, so don’t sweat losing a hand here and there. Over an entire shoe of hands, you should be able to steadily win more than you lose.
And, as Brian Brushwood says, in the course of your life, very few things make a cooler story than getting kicked out of a casino for counting cards.
Do you play in casinos? Ever tried to cheat?
