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February 2006

Are you more likely to play the major lottery when the jackpot is more than $250 million? If you happen to play, and if you’re really lucky, there’s a chance, however slim, you might win it all. Let’s say you just realized you’re taking home the grand prize and you’re the only winner. Now what?

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According to the experts offering advice in an MSN Money article, here are some steps you should take.

  • Keep the ticket safe. You’re not turning the winning ticket in right away, but it’s your proof that you won. Hold on to it in a safe deposit box while you make the rest of your preparations.
  • Think about your job. We just had this discussion in the office as I put my $1 into the pool. Most winners quit their jobs, even if a significant number say they won’t. But don’t jump the gun, and don’t make a scene.
  • Find people you can trust. You’ll need a lawyer, accountant, and financial advisor. If you don’t have any currently, ask for referrals from friends.
  • Decide on a lump sum or payments. When I was younger, I used to have this discussion with friends. In general, the thinking was that it was much better to take the payment option as the lump sum payout is significantly less than the sum of all the payments. But if you take the lump sum and are diligent about investing, you could end up with more in the end. In reality, most of the time the winners who choose the lump sum option are not diligent.
  • Arrange for a special account at the bank. Although we’d love to get take an oversized cardboard check to the bank, your winnings are transferred by wire. You’ll need a special bank account to handle the deposits.
  • Change your phone number. You never know how many relatives and long lost friends you have until you have come across a large sum of money. With a new unlisted number, you can be in control of those with the ability to contact you.

The article continues with more tips:

You’re about to become filthy rich, so splurge if you want to and arrive at lottery headquarters by limo, helicopter or elephant, if you are so inclined. But don’t take too much time. There’s always a deadline.

If you’re a person who is habitually late, watch out for this. Who wants to miss out on $250 million due to traffic or issues with the day-care?

The Tax Man cometh before you even get your money, immediately making you 28% poorer. And if you’re the kind of scoundrel who owes something called state-owned-debt, such as back taxes or child support, the lottery folks take that off the top as well.

That’s quite a bite for the government, but if you’re still coming out with $180 million after taxes, can you complain?

Finding a way to spend millions may seem insurmountable, but it’s really not that difficult. Many folks — lottery winners and insta-rock stars alike — have succeeded in finding solutions to this particular “problem.”

The article provides some tips for spending and saving large amounts of money responsibly.

You’ll probably want to help out your family and those who were friends before you were rich. You might be interested in leaving a legacy by helping your favorite cause in a major way… And you’ll probably want to have something at the end to leave to your heirs — ’cause then you get to play all kinds of mind games writing up your will different ways.


There are two typical responses when a person finishes preparing his tax return, depending on the result. If he owes money, I hear, “Do’h! I have to pay the government more. I wish they’d use my money more efficiently.” If he is due a refund, I hear, “Woohoo! I’m going to get a big fat check from the government!”
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I decided to take advantage of Comcast’s offer for a free upgrade from 6 Mbps to 8 Mbps internet service more than a week ago. (Wow, what a long way we’ve come since I was running a dial-in bulletin board system on an 8088 IBM clone at 1200 bps.) When I called originally, they said all they had to do was basically flip a switch and I’ll be upgraded. I should see the new increased speed within half an hour.

Well, I didn’t see the increased speed. In fact, after running some speed tests, I realized I was getting the same 1.5 Mbps I’ve been getting for years. This was the moment I realized I had been paying for 6 Mbps service but only getting the slower speed.

I let a week go by to do some more tests over time. There was no change after a week, so I called Comcast again to troubleshoot. They saw no problems on their end, and I should be able to receive data at 8 Mbps. I do quite a bit of downloading, so the extra speed would be helpful, but I wasn’t getting it. They scheduled someone to come in to take a look.

Their technician stopped by today. He unplugged my model from the cable and tested with an interesting handheld device. The signal was entering my apartment at full speed, so the issue was with my modem. My cable modem is about five years old. He checked with Comcast’s servers and they determined that my old Linksys modem complies with DOCSIS 1.0, an old standard incompatible with Comcast’s newer high speed service.

I wish they told me this years ago when service was first upgraded to 3 Mbps, or later when it was upgraded to 6 Mbps. In any case, it gave me a good excuse to run out today to get a new modem. I picked up a (DOCSIS 2.0) D-Link cable modem and set it up. It took Comcast’s customer support some time to upgrade my account — they were having their own computer problems — but now, I’m finally flying.

I do so much work online, increasing my speed more than 400% (when it comes to big downloads — viewing typical websites is pretty much the same) is a big help. Additionally, this new modem doesn’t seem to have the same problem of randomly dropping the connection when I’m using close to the maximum bandwidth.


Thanks to AllThingsFinancial, I came across this piece by Ben Stein, who I’ve mentioned fairly often on this blog. I like Ben Stein even though we don’t always agree on every issue.

In his new column in the New York Times, Ben talks about the huge disparity between worker and executive pay. He provides some examples of how the differential has grown over the last forty years and postulates some reasons on why we have allowed this to occur. His reasoning stems from the lack of governance by the board of directors. The members of the board, who are supposed to work for the shareholders, now exist to protect executives from the shareholders. Ben says this is not a result of a free market.

We should be up in arms! Why has there not been a worker revolution? We have not stormed on Washington or the Board Room demanding a fairer system. Why not?

I think it comes down to the “American Dream,” which was basically a myth perpetuated over the last couple of centuries. The American Dream says that anyone can get rich, anyone can move up in class, anyone can build wealth beyond their wildest dreams. Sure, some do. And those that do are fashioned into “proof” that the American Dream works. (See “anecdotal evidence.”)

Most people will struggle their entire lives to survive or just “get by,” even if the United States is the richest nation in the world. I’m not talking about people who spend as if there were no tomorrow, racking up mounds of debt they plan to leave to their children to deal with. Honest workers, honestly trying to move up through education and networking, will generally remain lower-middle-of-the-road.

We don’t want anything “bad” to happen to the richest in our country because we think we’re going to be there someday. All right, now it’s my turn to get off the soapbox.


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