N.C. man claims $141M Powerball lottery jackpotPrevious TopicNext Topic

Some folks don't play unless the advertised jackpot is above $100 million. To get them to part with those dollars, the larger of the two numbers will be promoted. Full disclosure in advertising? That'd be like letting you take home your entire pay check all year and then presenting you with your entire tax bill all at once. Far better (for them) to take your money over to course of the year. Look at all the people who cheerfully await their "refund".

There's a reason so many prices end in $X.95 (and fractions of a cent, at gas pumps)

It boils down to the Time Value of Money:

The Time Value of Money is the value of money figuring in a given amount of interest earned over a given amount of time.

Why even advertise an anuity amount?  Doesn't it make more sense to advertise the amount a winner will recive in one lump sum at the time of of the drawing?

Why don't they put the cash value in big numbers and the annuity amount below in small letters?  It is misleading.  Looking up the definition of FALSE in the dictionary, one of the definitions is " c : intended or tending to mislead "

IT IS FALSE ADVERTISING

It's not false advertising because the prize itself is an annuity OR lump sum, whichever the winner chooses. This is stated in the rules of the game which the player is responsible for reading, although a lot of people don't bother reading the rules of jackpot games such as Powerball, Mega Millions, or Lotto. They just see the jackpot amount, want it, and buy tickets for it. Whether or not they were unaware the advertised was an annuity not is their responsibility.

I'll say what I've said before: Annuities are nothing new. They've been around for a long time. They are the amount that's advertised. It should be expected by now. If people aren't going to research what they're getting involved in, then they shouldn't be participating in it. Don't play the lottery. Of course, we both know that's not going to happen because, hey, if they win, even if the cash value is 50% of the annuity, they still know it's a ton of money. I'm sure they'll gladly take it.

I'm not going to get involved in horse race betting when it's something I've never done before without reading the rules of the game, wager options, prize payouts, etc. Same thing with poker. Why would someone buy into a poker tournament if they've never played before and don't even understand hand rankings? No research whatsoever.

But if you act right now we'll double your order and send you six pants extender buttons all for just $19.95! (just pay extra shipping)

Why is it even necessary to offer an annuity?  What is the purpose of offering one?

Having an annuity gives the winner an alternative to taking a lump sum payout, which, depending on the winner, could be beneficial. I'd assume age and manageability are the biggest factors.