Man who won £4 million on lottery takes home £2.5 million after being given ultimatum
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A bloke who won a whopping $5 million (£4m) on a scratch card was left with a lot less after he made a decision on how he’d like to receive his winnings.
Daniel Grijalva Esquivel, from Kansas City, won the $5 million after purchasing a New York Lottery's Cash X100 scratch-off for $20 (£15) from a convenience store in Spring Valley, New York.
According to the New York Lottery, the odds of landing the $5 million (£3.9m) jackpot are one in 4,498,390.
In the US, when someone wins the lottery one of the first decisions they are asked to make is whether they would like to have their prize as a one-off payment or break it down into annual payments.
Across the US, most lottery winners decide to take their jackpot as a one-off lump sum, like Esquivel did.
However, those who choose to have the annual payouts usually receive winnings nearer the advertised jackpot, but are still subject to taxes.
The other benefit to the annual payouts is that they offer a steady stream of income over the years and mean you’re less likely to blow through it all in a couple of years - unlike British lottery winner Michael Carroll.
Chicago-based lawyer Andrew Stoltmann, who has represented several lottery winners over the years, says that opting for the annual payouts is a far safer idea for most people.
Speaking to CNBC in 2022, he said: “Few lottery winners have the infrastructure in place to manage a lottery windfall.”
In an interview with The Sun, Stoltmann explained: "They [the winners] tend to be from lower socioeconomic backgrounds.
“So they then take this massive sum of money and they just don't really know what to do with that. It's a pretty big mistake."
He went on to explain that even if someone does fritter away their first payout it’s not the end of the world.
“To make a mistake with the first year’s winnings is not catastrophic if the winner is going to receive another 29 years’ worth of payments,” Stoltmann added.
OK, well duly noted. Now I’m off to buy a scratch card - wish me luck.