New Jersey United States
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March 25, 2011
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I noticed on the redesigned New Jersey lottery web-site that they are no longer posting the amount for the Cash option and the Annuity for the Pick-6 lotto, Megamillions or Powerball. They are only posting the Annuity amounts. I hope they decide to put the information back once they are finished with the web-site. But anyway, that's kind of an aside from my question...
Is it true that if you select "Annuity" on a bet slip for Powerball and Megamillions, that you can change your mind if you win and take the Cash; but if you select "Cash" on the bet slips, that you no longer have the option to take the annuity? Does anyone know if I have this right or am I spreading rumours? ;) If it is correct do these rules also apply to the Pick-6 lotto in NJ? Does it vary from state to state?
Kentucky United States
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February 14, 2006
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Quote: Originally posted by karinda on Jul 5, 2011
I noticed on the redesigned New Jersey lottery web-site that they are no longer posting the amount for the Cash option and the Annuity for the Pick-6 lotto, Megamillions or Powerball. They are only posting the Annuity amounts. I hope they decide to put the information back once they are finished with the web-site. But anyway, that's kind of an aside from my question...
Is it true that if you select "Annuity" on a bet slip for Powerball and Megamillions, that you can change your mind if you win and take the Cash; but if you select "Cash" on the bet slips, that you no longer have the option to take the annuity? Does anyone know if I have this right or am I spreading rumours? ;) If it is correct do these rules also apply to the Pick-6 lotto in NJ? Does it vary from state to state?
Thanks very much.
Karinda
Most lotteries did away with making the choice between "cash" or "annuity" before the drawing many years ago and now the winners make that choice when they validate their ticket. I believe in Ohio if they are still undecided, they have 60 days to make up their mind.
I'm not a financial adviser but it may be possible to purchase a larger interest baring annuity with the lump sum payoff before taxes are taken out. The down side with taking the annuity option is you're locked in for 25 or more years. If things change in the next 10, you'll be calling J. G. Wentworth. Don't know the percentage they'll keep, but the total will be probably much lower than the original cash option minus whatever annuity payments were received.
Can I change my mind about annuity and cash when I win a prize?
Should you hold a winning Pick-6 Lotto, Powerball or Mega Millions ticket and it has been purchased as an annuity ticket, the New Jersey Lottery will immediately purchase the annuity at the rate available. You do have the option of requesting that the New Jersey Lottery sell that annuity on your behalf within 60 days. However, the sale will be governed by the market rates at the time of sale—therefore, you could possibly lose money or increase your winnings based on the rates at the time of sale.
However, if you have a cash ticket, you cannot switch it to an annuity ticket—precisely because the bonds to fund that annuity would have needed to be purchased as soon as it was determined a winning ticket had been sold in New Jersey . If the person is taking cash—because bond rates fluctuate—the annuity they might receive could be very different from the original annuity which had been advertised.
United States
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June 16, 2006
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If you take cash, you generally end up with about 45% of the jackpot, depending on the state you live in. The bigger the jackpot, the less you get. Eight folks split a 380 million dollar jackpot, they each ended up with a bit under 17 million each, do the math.
While the annuity pays more, I'd still take the cash option and buy myself an annuity with a portion of it, probably 50%, and quite frankly I'd blow the rest of it. Yeah, I would endow some charities as well, but I'd be having some fun also.
New Jersey United States
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March 25, 2011
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Quote: Originally posted by karinda on Jul 5, 2011
I noticed on the redesigned New Jersey lottery web-site that they are no longer posting the amount for the Cash option and the Annuity for the Pick-6 lotto, Megamillions or Powerball. They are only posting the Annuity amounts. I hope they decide to put the information back once they are finished with the web-site. But anyway, that's kind of an aside from my question...
Is it true that if you select "Annuity" on a bet slip for Powerball and Megamillions, that you can change your mind if you win and take the Cash; but if you select "Cash" on the bet slips, that you no longer have the option to take the annuity? Does anyone know if I have this right or am I spreading rumours? ;) If it is correct do these rules also apply to the Pick-6 lotto in NJ? Does it vary from state to state?
Thanks very much.
Karinda
Thank you all very much. I appreciate you taking the time to respond to my question. The answers are very helpful. In NJ, players are still required to select Cash or Annuity at the time they purchase their tickets. If I am fortunate enough to win, I like having the option to decide later, rather than making the decision about more money than I've ever had in my lifetime standing in the middle of a convenience store. :)
I have mixed feelings about both options for the same reasons that were mentioned. There are no guarantees with an annuity payout, so much can change in 25 or 26 years (or however long the payout is). There's something to be said for taking the money and running. lol ;) On the other hand, there's something appealing about getting the money over time too. Not only because the payout is higher, but it could also serve as a safety net. Winning 100 million paid out over 25 or 26 years versus winning 10 million paid out over 25 or 26 years are very different scenarios.
Thanks again for sharing your perspectives on the subject. I learned a lot from them and wish you all the best for prosperity, health, and happiness.
Oklahoma United States
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November 12, 2009
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"The down side with taking the annuity option is you're locked in for 25 or more years. If things change in the next 10, you'll be calling J. G. Wentworth. Don't know the percentage they'll keep, but the total will be probably much lower than the original cash option minus whatever annuity payments were received." with Stack47
Kentucky United States
Member #32,651
February 14, 2006
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Quote: Originally posted by guesser on Jul 6, 2011
If you take cash, you generally end up with about 45% of the jackpot, depending on the state you live in. The bigger the jackpot, the less you get. Eight folks split a 380 million dollar jackpot, they each ended up with a bit under 17 million each, do the math.
While the annuity pays more, I'd still take the cash option and buy myself an annuity with a portion of it, probably 50%, and quite frankly I'd blow the rest of it. Yeah, I would endow some charities as well, but I'd be having some fun also.
Almost 35% Federal tax plus whatever state tax is deducted right off the top so there is a huge difference between the cash prize and the annuity. The current PB jackpot of $48 million would net the winner less than $15 million but you have to compare that to the approximate $944,000* after tax yearly payments.
"I'd still take the cash option and buy myself an annuity with a portion of it, probably 50%"
At a 7% annual interest rate, you'll get over $500,000 a year and 29 years later, you'll still have $7.5 million. You can buy lots of stuff with $5 million and the interest from investing the rest could actually exceed the annuity payments.
*from a tax base of 35% Federal and 6% state. (your milage may vary)
United States
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June 16, 2006
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Point being if I buy myself an annuity: I'd be less likely to blow it ALL, make lousy investments, have the market crash (again), get scammed by someone, and I would still have an annual (or monthly) income check on top of my 'blow it' money. A golden parachute if you will.
with Stack47
