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Mega Millions jackpot swells to $252 million. What to do first if you win

Key Points
  • Experts recommend telling as few people as possible about your windfall so you can avoid being approached by long-lost friends or family (or complete strangers) for a piece of the prize.
  • The winner will have to choose between taking a lump sum of $148 million or spreading out the win over three decades. Either way, the actual amount you'll get will be far less due to federal taxes and, typically, state taxes.
  • Make sure you assemble a team of trusted professionals to help you navigate your newfound wealth.
This is what you do if you win the lottery

With no one hitting the Mega Millions jackpot Friday night, the prize has climbed to $252 million.

If you plan to buy a ticket for Tuesday's drawing, remember that suddenly winning that amount of money is a life-changer in more ways than having a really fat bank account. And if you don't approach it properly, that windfall could bring unanticipated headaches.

"It can be both a blessing and a curse," said certified financial planner Jim Shagawat, president of Windfall Wealth Advisors in Paramus, New Jersey. "If you win, take a deep breath and don't make any major moves right away."

Photo by Kevork Djansezian / Getty Images staff

One of the big decisions you'll have to make if you win is whether to take the lump sum of $148 million or spread the winnings over several decades. For the cash option, the 25 percent federal tax withholding of $37 million would reduce the amount to $111 million. You also likely will owe more to Uncle Sam at tax time.

On top of that, there will be state taxes on your windfall unless you live where lottery wins are untaxed. In states that do take a piece, the range is from a high of 8.82 percent in New York to a low of 2.9 percent in North Dakota, according to lottery site

The important thing is to avoid becoming a lottery winner who unintentionally fritters away the new wealth.

"The main reason that happens is there's a failure to develop a plan for careful and thoughtful management of the money," Shagawat said.

Here are some tips for the winner.

Protect your identity and the ticket

Experts recommend sharing your win with no one but your family or closest circle of friends. News has a way of spreading quickly, and you don't want to unwittingly become a target for people seeking hand-outs, loans or other access to your sudden wealth.

Maintaining your privacy is easier if you don't have to go public with your win. Find out whether you can claim your prize anonymously in the state where you purchased your ticket. Some states make it easy to remain anonymous, while others require a bit more planning. And in some states, it's impossible.

Also, keep the ticket close. The general advice is to sign the winning ticket and make several copies. The idea is that if you somehow are separated from the ticket, your signature should help ensure you get the prize.

However, that also could prove problematic if you are allowed to claim the prize via a trust to protect your identity. This makes it important to consult with a trusted advisor before doing much of anything.

Appoint a team and a gatekeeper

Experts recommend assembling a team of experienced professionals, including an accountant, a financial advisor and an attorney (this should be your first call).

One of those pros should be your gatekeeper for all future requests for money, whether from family, friends or others.

"Some people give away too much money to family and friends, and they do it to a point that it damages their own life goals," Shagawat said. "When the gifting starts, it's difficult to stop."

The more people who know about your newfound wealth, the greater the chance you'll be approached. Having a gatekeeper to screen all requests and fend off outstretched palms can ease any pressure or guilt that could lead you to making foolish financial decisions.

"I tell clients to tell all of their friends and relatives that they can't make any donations, gifts or investments without running it by me as their advisor," said Jason Kurland, a partner at Rivkin Radler, a law firm in Uniondale, New York.

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Give thought to the big picture

Depending on where you live, you have about six months to a year to claim your prize, so you don't need to be in a rush.

"Give yourself time and space to process it," Shagawat said.

Before planning to spend a dime, think about what this sudden wealth means — financially and otherwise.

While at first you might dream only of a new house, new car or extended vacation, winners often realize it's a chance to consider their legacy and think about any societal contributions they want to make. Some even set up their own charitable organizations.

Lottery taxes 2018 version GRANT