Players on edge for record $1.6 billion jackpot in Mega Millions drawing

By Gina Cherelus

NEW YORK (Reuters) - A record-setting $1.6 billion prize in the Mega Millions lottery has Americans dreaming of buying homes, cars, helping financially strapped friends and family and early retirement, but experts caution that with their newfound riches will come many headaches.

"A big mistake people think: this is a lot of money so let me help everyone," Laurie Ruckel, a trusts and estates lawyer at Loeb & Loeb law firm in New York, said on Tuesday. "There are plenty of people who know how to exploit that ignorance."

Ruckel said the crush of publicity that falls on a lottery winner is something that most people do not usually experience, even those with a high net-worth. She said prize recipients should create a trust and hire a team of lawyers, financial advisers and security.

The drawing will be held at 11 p.m. EDT (0300 GMT Wednesday).

Anyone who hits all six numbers to win the jackpot can choose an immediate cash payment of $904 million or receive the $1.6 billion prize over 29 years.

The Mega Millions jackpot and a Powerball lottery prize that stands at $620 million, have spread lottery fever across the United States in recent days.

On Tuesday morning, a few customers waited in line at a newsstand in the Port Authority Bus Terminal in New York City to purchase last-minute tickets. Fernando Chavez, 27, said if he wins he would immediately hire a financial adviser.

"I'd buy a few properties, get my family in order and share with my neighbourhood," said Chavez, who lives in the Harlem neighbourhood of Manhattan.

Mega Millions set a record for lottery jackpots after nobody won the $1 billion prize on Friday. The previous record was a $1.586 billion jackpot for a Powerball drawing in 2016.

Lottery players face odds of 1 in 303 million of winning the Mega Millions drawing. That is up from 1 in 259 million a year ago; the change was made to generate larger prizes.

In comparison, the odds of getting killed by a shark are 1 in 3.7 million in a lifetime, according to the International Shark Attack File.

Tickets sold for Tuesday's drawing are expected to cover 75 percent of all possible number combinations, lottery officials said.

Wednesday's Powerball lottery prize stands at $620 million, making it the fifth-largest jackpot in U.S. history, after no one got all six numbers in Saturday's drawing. The lump sum cash payout is estimated at $354.3 million.

The $1.6 billion jackpot, a jaw-dropping amount to the average person who can afford a $2 ticket, is still less than two weeks of profit for Apple Inc. A $1.5 million investment in Microsoft Corp in 1986 would be worth about $1.6 billion today.

If more than one person wins, the jackpots would be divided proportionately, as happened in 2012 with a Mega Millions jackpot of $656 million, a lottery official said.

Mega Millions tickets are sold in 44 U.S. states, the District of Columbia and the Virgin Islands. Several states allow online ticket purchases, but they prohibit out-of-state and foreign purchases.

States receive a percentage of lottery ticket sales and then use the money to support public schools or meet other needs.

Both lottery jackpots have been increased recently by rule changes that have reduced the chances of winning.

 

(Additional reporting by Brendan O'Brien in Milwaukee, Stephen Nellis and Paresh Dave in San Francisco; Editing by Lisa Shumaker and David Gregorio)