Everything You Need To Know If You Win The Powerball Jackpot

by Cate Carrejo
Ringo H.W. Chiu/Getty Images News/Getty Images

The upcoming Powerball lottery has America buzzing with the exciting possibility of hitting it rich. But as thrilling as the possibility of a $700 million jackpot is, it's also a huge responsibility that you should put some thought into if you've bought a ticket, no matter how small your chances of winning are. Here's what you should do if you win the Powerball jackpot, because even if you win it's still fun to daydream about.

Update: CBS Boston reported that Mavis Wanczyk bought the winning ticket at 2:30 p.m. on Wednesday.

Different states have their own rules for claiming powerball winnings, so if you happen to be the winner, make sure you look up how long you have to claim your prize. No matter what, make sure you take the lump sum cash instead of recurring annual payments, because even though it seems like you'll get less money, it'll earn you more through investments than getting paid over 30 years.

Take advantage of your time before claiming your reward to get your finances in order, and keep your winning under raps except for people who absolutely have to know — you'll want to have your own concrete plan for what to do before you tell people, without all the pressure from acquaintances and family who might conveniently crawl out of the woodwork now that you're rich.

But what should that plan entail? According to CNBC's Jim Kramer, the perfect formula is a mix of buying stable assets like gold and government bonds, donating to charity, and setting up a diverse investment portfolio. It's up to you to figure out how much you want to give away and how much you want to keep as cash on hand, but if you're trying to keep your fortune intact for the most part, you'll want to keep it in some form that you won't be too tempted to spend. Set up a meeting with a financial advisor who can help you figure out what combination of assets works best for you and your unique situation.

After that, go crazy, but within limits. Figure out what your biggest dreams are and make them come true, just make sure that your priorities and strict spending plan are in place first so you don't end up like these lottery horror stories. Balling out shouldn't come at the expense of taking care of what means most to you, and that's usually the people in your life. Some serious soul-searching might be required to realize how much you actually want to spend on yourself and how much you want to give to others — presumably you'll have lots of time to do it from your luxury hotel in Tahiti.