7 On Your Side has tips on how to handle Powerball winnings

EMBED </>More News Videos

If you bought a Powerball ticket you've likely dreamed of how you're going to spend your $1.5 billion. 7 On Your Side's Michael Finney has tips on how to handle all that money. (KGO-TV )

If you bought a Powerball ticket you've likely dreamed of how you're going to spend your $1.5 billion. 7 On Your Side's Michael Finney has tips on how to handle all that money.

Stories unfortunately are plentiful of athletes and entertainers who went from being multi-millionaires to filing for bankruptcy. Here's what you need to know to avoid becoming one of those statistics.

VIDEO: Tips to stay anonymous if you win lottery
EMBED More News Videos

Here are some tips from a lawyer on how to stay anonymous if you win the lottery.



Rapper MC Hammer shot to fame and fortune with his hit "U Can't Touch This." Handling all that money proved difficult and he was forced into bankruptcy

If you're lucky enough to have the Powerballs bounce your way, your first decision is to collect your money in a lump sum, or over 20 years. Most people who spoke with 7 On Your Side said they'd prefer getting the money all at once.

"Take it in one lump sum," said David Tsang of San Francisco.

"One lump sum," Patrick Lee said.

READ MORE: California lottery lists luckiest Bay Area stores

We then took the question to a senior vice president of investments at Wells Fargo.

"If you're not comfortable taking the lump sum and you're afraid you're going to blow it all, I would absolutely consider taking the stream of payments," said Wells Fargo president Bruce Lin.

Bruce Lin's preferred choice is to take the lump sum and invest it.

Put your money in conservative holdings such as certificates of deposit and tax free municipal bonds. Aim for a five percent return on your investment including any tax savings.

"Certainly when you have that much money, the key is to stay rich," Lin said.

That doesn't mean you can't have fun. Lin suggests a new car, or even a home might be in your future.

"I think I'd buy a nice big penthouse in San Francisco, top floor," said Dennis Mulvihill of Petaluma.

PHOTOS: Meet the lucky winners of the largest lottery jackpots in U.S. history


Get together with an estate attorney and set aside money for your heirs. A financial adviser can even help with distributing some to charities, even family and friends with special needs.

Lin says going into hiding for a few months after winning might be advisable.

"My recommendation is really take your time. Take that six months and think about things. Really plan out what's meaningful to your life," Lin said.

READ MORE: Smartest strategy if you win the lottery
EMBED More News Videos

If you happen to strike it rich and win the $800 million Powerball jackpot, here's a look at a smart strategy for what to do with it all.



MC Hammer was able to rebound and is now CEO of his own record label.

The Powerball will automatically deduct your federal taxes from your winnings. But you'll need to set aside any state and local taxes you'll have to pay. MC Hammer was able to rebound and is now CEO of his own record label.

Click here for full coverage on Powerball fever.

To get Wednesday night's numbers the moment they're drawn, download the ABC7 News App. Make sure you enable push notifications for immediate notifications!
Related Topics:
newspowerballlotteryu.s. & worldmoneycontestsbuzzworthysocietyeconomybusinessbay area7 On Your Sidewells fargobankinvesting
(Copyright ©2017 KGO-TV. All Rights Reserved.)


POWERBALL
More powerball

NEWS
More News

Top Stories
Show More