ColoradoHusk Posted January 12, 2016 Share Posted January 12, 2016 Always take the cash payout. Unless you think you will blow through all that cash, but the cash payout is the better deal. The annuity payout is such a bad rate of return. Quote Link to comment
RedSavage Posted January 12, 2016 Share Posted January 12, 2016 Always take the cash payout. Unless you think you will blow through all that cash, but the cash payout is the better deal. The annuity payout is such a bad rate of return. Yep, plus if you die right away guess who gets to keep your money. But I'll gladly partake! Quote Link to comment
ColoradoHusk Posted January 12, 2016 Share Posted January 12, 2016 Always take the cash payout. Unless you think you will blow through all that cash, but the cash payout is the better deal. The annuity payout is such a bad rate of return. Yep, plus if you die right away guess who gets to keep your money. I think the annuity payments can be passed on to heirs, now, but the cash payout is way better. The annuity payment is basically an annuity with 3.7% annual interest. Quote Link to comment
RedSavage Posted January 12, 2016 Share Posted January 12, 2016 Always take the cash payout. Unless you think you will blow through all that cash, but the cash payout is the better deal. The annuity payout is such a bad rate of return. Yep, plus if you die right away guess who gets to keep your money. I think the annuity payments can be passed on to heirs, now, but the cash payout is way better. The annuity payment is basically an annuity with 3.7% annual interest. Huh, didn't know the annuity could be passed on to heirs. That's not bad for a guaranteed rate but like you said, you'd be much better off taking the lump sum and investing it. You could live very comfortably off the interest alone, most years. Quote Link to comment
Apathy Posted January 12, 2016 Share Posted January 12, 2016 The University of Nebraska would be getting a phone call from me the day after I won the 1.33 billion. I would ask them how much money would I have to donate to the University to have a suit for the rest of my life, access to practices, sidelines and anything else for that matter. 1 Quote Link to comment
Landlord Posted January 12, 2016 Share Posted January 12, 2016 Per the NYT, and per common sense, the annuity is a smarter move, if for no other reason than it protects you from yourself: http://www.nytimes.com/2016/01/13/upshot/dear-powerball-winner-take-our-advice-and-take-the-annuity.html?partner=538 2 Quote Link to comment
GSG Posted January 12, 2016 Share Posted January 12, 2016 Currently six states — Delaware, Kansas, Maryland, North Dakota, Ohio and South Carolina — allow lottery winners to remain anonymous. And four more — Colorado, Connecticut, Vermont and Massachusetts — allow anonymity if the winners claim their winnings through a trust. http://www.freep.com/story/news/politics/2015/05/13/lottery-winners-remain-anonymous/27249895/ Quote Link to comment
ColoradoHusk Posted January 12, 2016 Share Posted January 12, 2016 Cash payout would be $930 Million. Roughly 40% federal taxes would take out $372M. Let's assume another 5% state income tax (varies depending on state), so that's another $47M. So, that is a total of $511M of take home cash. Even if you took $11M and blew it on the stupidest stuff you can think of, you would be left with $500M. Let's say you took $200M of that an invested in fixed income securities, paying 4-8%. That is $8-16M of INCOME just on that $200M. That $200M would also be pretty safe and not lose much value, if any. You could take the other $300M and invest it in other stuff that you will never touch and can leave alone and then figure out what you want to do with it later in life. 1 1 Quote Link to comment
GM_Tood Posted January 12, 2016 Author Share Posted January 12, 2016 Per the NYT, and per common sense, the annuity is a smarter move, if for no other reason than it protects you from yourself: http://www.nytimes.com/2016/01/13/upshot/dear-powerball-winner-take-our-advice-and-take-the-annuity.html?partner=538 Taxes, brah. Quote Link to comment
ColoradoHusk Posted January 12, 2016 Share Posted January 12, 2016 Per the NYT, and per common sense, the annuity is a smarter move, if for no other reason than it protects you from yourself: http://www.nytimes.com/2016/01/13/upshot/dear-powerball-winner-take-our-advice-and-take-the-annuity.html?partner=538 Learn how to say no. If your friends start asking you for money before you offer it to them, they aren't your friends. 1 Quote Link to comment
Landlord Posted January 12, 2016 Share Posted January 12, 2016 Cash payout would be $930 Million. Roughly 40% federal taxes would take out $372M. Let's assume another 5% state income tax (varies depending on state), so that's another $47M. So, that is a total of $511M of take home cash. Even if you took $11M and blew it on the stupidest stuff you can think of, you would be left with $500M. Let's say you took $200M of that an invested in fixed income securities, paying 4-8%. That is $8-16M of INCOME just on that $200M. That $200M would also be pretty safe and not lose much value, if any. You could take the other $300M and invest it in other stuff that you will never touch and can leave alone and then figure out what you want to do with it later in life. Sounds like the rationale of every lottery winner that ended up bankrupt I'd take the annuity in a heartbeat. Leaves my family set for life no matter what, would still have more money than I'd ever know what to do with but in the form of essentially a yearly salary, and I honestly just couldn't care about the difference between two close amounts in the hundreds of millions. Quote Link to comment
GSG Posted January 12, 2016 Share Posted January 12, 2016 If I win, I will buy you a lifetime supply of selfie-sticks, Landlord 1 Quote Link to comment
ColoradoHusk Posted January 12, 2016 Share Posted January 12, 2016 Cash payout would be $930 Million. Roughly 40% federal taxes would take out $372M. Let's assume another 5% state income tax (varies depending on state), so that's another $47M. So, that is a total of $511M of take home cash. Even if you took $11M and blew it on the stupidest stuff you can think of, you would be left with $500M. Let's say you took $200M of that an invested in fixed income securities, paying 4-8%. That is $8-16M of INCOME just on that $200M. That $200M would also be pretty safe and not lose much value, if any. You could take the other $300M and invest it in other stuff that you will never touch and can leave alone and then figure out what you want to do with it later in life. Sounds like the rationale of every lottery winner that ended up bankrupt I'd take the annuity in a heartbeat. Leaves my family set for life no matter what, would still have more money than I'd ever know what to do with but in the form of essentially a yearly salary, and I honestly just couldn't care about the difference between two close amounts in the hundreds of millions. I also could live very well with the annuity payments. I have a finance background, so I would actually like having the ability to try to make the money work for me. If I took a few million $ and blew it on the stupidest stuff ever to get it out of my system, I am sure I would have a hard time spending $5-10M per year. It sure would be fun trying though. Quote Link to comment
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