Lottery is a popular way for governments to raise money quickly and often provides a good return on investment. But there are a few things that all winners should know before they start spending or handing out the money. The first step is to get a financial team together — this includes a financial advisor and planner, an attorney for estate planning, and a certified public accountant who can help with taxes. It’s also a good idea to stay anonymous and, if possible, avoid any big purchases for the first year or two.
Lottery proceeds go toward a variety of purposes, from paying prizes to funding gambling addiction programs. But most of it goes to pay commissions for retailers who sell tickets and other operational costs for lottery administrators. The earliest recorded use of the lottery dates back to the 15th century, when a number of Low Countries towns used it to raise funds for town fortifications and help the poor.
Many people try to improve their odds by selecting numbers that have been drawn recently or by choosing a specific sequence. But there’s no scientific evidence that these strategies work. And no matter what number combination you choose, the odds of winning are still just as random as they were before.
Most lottery winners choose to receive the prize in a lump sum or an annuity payment. Those who select lump sum will receive a smaller amount than the advertised jackpot because of federal withholding and state and local taxes. But those who choose annuity payments can begin investing their winnings immediately and take advantage of compound interest, which can add up over time.