TOP STORY: Bay Lotto wins top $120 million

By John Cousins
Tauranga Lotto players have won $120 million in prize money since the popular game of chance first began on August 1, 1987.
And it does not look like slowing down.
New Year's Eve's $8.6 million Powerball jackpot won by a Western Bay of Plenty family has gripped the imaginations of Tauranga punters like nothing before.
Last Saturday's biggest-ever single win for the Tauranga area made 1987's inaugural First Division prize of $360,000 look like small change. The massive $8 million Powerball prize, won on the back of a $600,000 First Division winning ticket, saw the number of First Division winners in the city and environs reach 100.
Add the rest of the Bay of Plenty and Lotto has repaid nearly $200 million in total prize money to ever-hopeful players.
Up until Saturday's big draw, there had been only one Powerball winning ticket sold in Tauranga ($6.5 million) and one other in the the Bay (Kawerau's $16 million).
New Zealand Lotteries has seen it all since Doug Harvey and Ann Wilson presented the first live TV draw, including the time a First Division winner showed up at the Wellington head office with the ticket taped to his stomach.
Communications manager Gabi Nobis said about half of the big money winners still like the buzz of coming to Wellington to claim their prize, even though they could claim it at any Lotto outlet.
"They feel it is part of the whole deal of winning."
The Western Bay's $8.6 million big winner is guaranteed a minimum after-tax income of $90,000 a year, assuming he or she spends $2.6 million indulging in lifestyle changes and helping family beforehand.
ABN AMRO Craigs' head of research, Cameron Watson, said banking the money at the official cash rate of 7.25 per cent would produce a before-tax income of $435,000. Tax stripped out $165,000 a year: "Enough to keep an MP in a job, plus expenses".
Although that left $270,000, Mr Watson said the winner needed to grow the remaining $6 million by $180,000 a year to keep up with inflation.
That left a total income of $90,000 a year.
This was the least-risk option, although acceptable when such a large amount of money was involved.
"With $6 million, you don't have to take a big risk," Mr Watson said.
The more likely scenario was to invest the $6 million into a balanced portfolio such as bank term deposits, government bonds, company bonds, shares that paid decent dividends and property.
Mr Watson said this offered a bit of capital growth on top of protecting against inflation and also spun off a good income stream.
For instance, a 50/50 split between high and low risk investment on $6 million - high risk being shares and property - would have produced a return of about 10 per cent ($600,000) last year. On a good year, this type of portfolio could return 15 per cent ($900,000) but on a poor year close to zero.
A 40-page booklet called Realise Your Dreams has been published by NZ Lotteries to help overnight millionaires cope with suddenly being rich.
It kicks off with common sense advice: "Make sure your money gets deposited into an interest-earning bank account. Then sit down and work out what to do with it."
It said most big winners experienced highs and lows, but feelings eventually settled down. "It is not unusual for lottery winners to feel a strong need for support from others." However, it cautioned: "Remember, the wider the circle of friends you tell (including family), the greater the chances of the media finding out - then you are public property."
It recognised that people often "let off steam" by buying something for someone special, but urged winners to work out a plan of what to do with their money - starting with drawing up a list of priorities within the first month of the win and starting a financial plan within three months.
A key piece of advice was to relax before committing the cash to medium or long-term priorities.
"Have a good rest ... lie on a beach somewhere."
It warns winners not to be hasty about quitting a job. "If you enjoy your work - the job, your friends, the routine and security it provides - don't give it up without being sure that's really what you want to do."