Kansas Powerball lottery winner claims jackpot anonymously

Comment #32

guesser — Mon, 09 Oct 2006 01:15:03 GMT

I can handle money very well because we never had it when I was growing up, it was just me and mom.

She worked minimum wage jobs, I worked in Jr. High, High School and College.

Momma preached to me from day one 'stay out of debt', and except for student loans, I have. I live every day as if I was

making $18,000 a year, and I made about 3x-4x that amount, but I still lived as cheap as I could, no telling when your job might disappear. I parlayed $60,000 in the stock market to almost a... [ More ]

Comment #31

chuck32 — Sun, 08 Oct 2006 18:05:41 GMT

I can only agree with you, but then I'm one of those people who seem to always need to spend it all. I have a CPA friend who manages to spend less than 100% of their income and I imagine that about 5% of the population can do that. I could really be socking it away if only I stayed living on $12,000 a year. My only excuse is that you do have to live a little for today - you never know when it will all end. I do know that when I'm stuck in that cheap retirement home while my buddy is getting... [ More ]

Comment #30

KY Floyd — Sun, 08 Oct 2006 17:49:53 GMT

Living on a fixed income for a long time obviously has its down-side, but what you're describing is stupidity. Being stupid is a much bigger problem than an income that doesn't go up. I could spend the 600 grand a year I'd net after earning a million bucks a year, and I could probably do it pretty easily, but only by being stupid or reckless. 600 grand a year is enough to live extremely nicely and still make an annual investment that's considerably more than the average household income.... [ More ]

Comment #29

chuck32 — Sun, 08 Oct 2006 16:47:06 GMT

Just hardly half-kididng about being tough to live on 1 million a year for 29 years. Most people quickly get used to their income. Having $1 million a year is great for the year or three, but then you start noticing that the docking fees on your yacht keep going up. The cost of a new Rolls-Royce has continued to rise. Your service staff keeps wanting raises. Those monthly trips to Europe keep rising with higher first class costs and luxury suite costs. Without an inflationary increase in y... [ More ]

Comment #28

nc6string — Sun, 08 Oct 2006 15:25:27 GMT

I remember when that happened, and the only thing I remember thinking was that I hope NC chooses Mega Millions instead of Powerball - didn't happen of course. The only thing the change did, I think, is lessen the chance (to about zero) that anyone would ever take the annuity option. The amount you get per year, in the first few years, seems so out of proportion with the total amount won, I can't see anyone taking it. It's like having a father, doling out an allowance again, Son, when you get... [ More ]

Comment #27

CA LotteryGuy — Fri, 06 Oct 2006 16:22:29 GMT

nc6string...while the length of the Powerball annuity has not changed, the annuity payment schedule has changed. In the summer of 2005 Powerball went from an equal payout schedule to a graduated (4% increase per year) schedule. This change means the amount of cash set aside for the jackpot can purchase a larger annuity. This means a bigger advertised jackpot which in turn lessens the percentage of the cash payout of the jackpot.

Interest rates do have an effect. Earlier this year the pa... [ More ]

Comment #26

chuck32 — Fri, 06 Oct 2006 15:44:24 GMT

The Powerball Annuity payout was changed last year to a graduated annuity payout - with each year's payment going up by 4%. If you had a lump of cash and wanted to set up your future, any financial advisor worth their salt would recommended a graduated annuity. Tough to live on even $1 million a year if it never keeps up with inflation. Lottery payouts that are equal really are not meeting the needs of a winner that wants to sit on the beach and not think about the money. The graduated annui... [ More ]

Comment #25

mr twentyone — Fri, 06 Oct 2006 11:19:15 GMT

hey another lucky person, well spend it wisely, i only wish the percentage was a little lower when they take out the taxes , so you get at least 75% instead of 30% , but hey good luck to all us guys who keep playing ,our time is soon,then when i win i will throw a block party for everyone on lottery post in the bahamas, and we will party like its our birthday,

Comment #24

nc6string — Fri, 06 Oct 2006 09:48:38 GMT

I agree, the length of the annuity is very important, but the length of the Powerball payout has not changed in some time, yet, people have noticed the lump sums on Powerball going from about 55% or so last year, to now under 50%, in which case, is all a function of rising interest rates.

Comment #23

guesser — Fri, 06 Oct 2006 04:46:00 GMT

You got that right.

It was about this time 4 years ago when folks would DIE for something they could make 6% on in the stock market, because most folks were losing money. I was making 8% and thought I was the richest guy around, and to show how things have gone since then, I've been making about 18% every year, and that's BAD - or at least average by today's standards.

I made a small fortune speculating on oil in 1998, and I also lost a bit speculating on something else I sold too soon on... [ More ]

Comment #22

KY Floyd — Fri, 06 Oct 2006 04:32:56 GMT

The thread in which Chuck explained things was in a thread about a pool winning PB, when the usual debates about annuity vs cash started. You can start here: https://www.lotterypost.com/news/139681.htm?p=2

As Todd pointed out, MM pays out on a different schedule, but other than that the procedure is similar. Seek bids, buy the annuity, send a check each year. It is, naturally, the annuity that is determined by interest rates. Ticket sales generate cash, and the cash is used to buy the an... [ More ]

Comment #21

Todd — Fri, 06 Oct 2006 03:38:27 GMT

Use the search feature for posts by Chuck32. Mega Millions uses a different procedure. They have equal installments, and Powerball uses annually increasing payments. But before going on any further, you really should check out all the info at www.usamega.com, because it's all there.

Comment #20

justxploring — Fri, 06 Oct 2006 03:29:43 GMT

They actually work very hard to get bidders with the highest rates... Todd

I never said they didn't. I don't think there is some sort of conspiracy. I was only saying that usually the higher the risk, the higher the gain (and also the higher the possibility of loss) Increase in value is often related to how safe the investment is, although not always. Anyway, I don't care - just give me $200 million anyway you want to and I'll take it.

Comment #19

CA LotteryGuy — Fri, 06 Oct 2006 03:27:35 GMT

Todd...how would one find the postings by Chuck Strutt regarding how MUSL calculates the annuity?

Also is it right to believe that Mega Millions would follow a similar procedure

Comment #18

Todd — Fri, 06 Oct 2006 03:05:24 GMT

They actually work very hard to get bidders with the highest rates, because doing so will make the annuity jackpot higher, which in turn drives more sales. It's not like MUSL executives are hoping to pay out a lower cash jackpot, and they pocket the difference or something. They pay out whatever there is, in its entirety.

In fact, Chuck Strutt (head of MUSL) posted several messages at Lottery Post describing exactly how they calculate the annuity, based upon how much cash they have. (Not t... [ More ]

Comment #17

justxploring — Fri, 06 Oct 2006 02:58:30 GMT

Oh, I know you're kidding, but I do understand why they don't pay the whole $15M. I just think they deduct too much from it to pay the lump sum. The balance is supposed to be the amount that will eventually (in 30 years) become the jackpot. My rant (actually it isn't a rant, just an observation) is that they are using the very lowest interest rate, although many might argue that government bonds are the safest. Large investments can play with one's emotions, so what one chooses to do with... [ More ]

Comment #16

guesser — Fri, 06 Oct 2006 01:18:56 GMT

Or the 'you can't take it with you' thoughts kick in.

I've never seen an armored car follow a hearse to a cemetary...

Comment #15

guesser — Fri, 06 Oct 2006 01:15:24 GMT

So where did the missing $7,829,828.00 go ?

(Rhetorical question

Comment #14

justxploring — Thu, 05 Oct 2006 23:27:45 GMT

Had to get the phone, so I couldn't edit...too late. Does anyone know how many PB or MM winners have actually chosen to take the annuity? The Washington Post reported this, but it was in 2003. I was curious and can't find the information.

Everybody takes the money, says Powerball spokesman Mahoney. In all the years of mega-jackpots, he said, only one big winner has ever wanted the annuity.

It's just that for so many years people have chosen the lump sum and out of all these people, I... [ More ]

Comment #13

justxploring — Thu, 05 Oct 2006 23:04:33 GMT

I didn't post that to start a debate or an argument. I know how to multiply and divide without using a calculator. I also have probably been to more seminars on annuities than most people, unless someone is also a licensed advisor. Still doesn't change my opinion of Powerball and its cash payout.

Comment #12

CA LotteryGuy — Thu, 05 Oct 2006 22:57:28 GMT

nc6string....compared to interest rates, the length of the annuity plays a bigger role in the value of an annuity. The longer the annuity, the lower the lump sum.

No where was this more evident then a few weeks ago when Powerball and Mega Milions each had annuity values of $15 million. The lump sum for Mega Millions (a 26 year annuity) was around $8.9 million while Powerball (a 29 year annuity) was valued at $7.1 million. Since they both fund with governemnt securities, the two games p... [ More ]

Comment #11

nc6string — Thu, 05 Oct 2006 22:16:58 GMT

Well, it isn't really baloney, if you want $15 million, you take the annuity, you'll get 15 million. Everyone has to pay taxes, me, you and the winner - so that's no news flash.

As far as 'he should have received x or y' well, that's not how lump sums are calculated. Lump sums are based upon interest rates. When interest rates are higher, lump sums go down. When interest rates are lower, lump sums go up. Rates have been rising steadily over the past year, so lump sum payments are going... [ More ]

Comment #10

justxploring — Thu, 05 Oct 2006 21:44:08 GMT

Thanks CA LotteryGuy. It's just so obvious to me that so much of this is advertising hype. I mean, who wouldn't want $4.1M? However, $15M sounds so much sweeter to most people. I know they only take out 25% (same in FL) for Federal, but I always figure that a winner should put aside another 10%. If he has a good accountant, it might be lower but I'll bet the IRS pays special attention to people who win several million.

For some reason, many people think 28% is the maximum tax, which isn't... [ More ]

Comment #9

CA LotteryGuy — Thu, 05 Oct 2006 21:03:57 GMT

Justxploring...regarding your comment about people taking home more then you calculate, here is what I came up with regarding this situation.

Lump Sum $7,170,172 (found on Powerball web site)

Federal witholding $1,792,543 (25%)

KS State witholding $358,509 (5% per USA Mega web site)

Take Home $5,019,120

Add... [ More ]

Comment #8

justxploring — Thu, 05 Oct 2006 19:39:29 GMT

I agree, guesser. The annuity payment is such baloney, since he got less than 1/2 of the jackpot. At least he should have received $7.5 or $8 million. In FL most of the Lotto jackpots are paid at 55% or more, so that would be around $8.2M here. Also, I always read that people take home much more than I calculate. Federal tax can be as high as 35%. I'm not sure if Kansas has a state tax. So I figure after all taxes are paid, he'll really only have between $4 - $4.5M. I agree it's a heck of a... [ More ]

Comment #7

guesser — Thu, 05 Oct 2006 19:08:31 GMT

How do you figure ?

It was advertised as 'a 15 million dollar jackpot', so he won 15 million, and got out of it with a bit over 5 million, after TAXES.

Comment #6

TheMaker — Thu, 05 Oct 2006 13:42:28 GMT

CONGRATS TO HIM. MAY HE SPEND IT WISELY AND DO SOME INVESTING WITH IT.

Comment #5

dingo — Thu, 05 Oct 2006 05:30:46 GMT

I was also worried about putting new tires on my car. Fortunately, I purchased 2 used ones in good condition. I had the same situation, but I was not the winner.

Congratulation to the lucky man.

Comment #4

KY Floyd — Wed, 04 Oct 2006 19:15:38 GMT

He didn't win 15 million. He won just over 7 million, and got to keep about 60% of it. I'd reather get more, but I could scrape by with 60% of 7 million.

Comment #3

guesser — Wed, 04 Oct 2006 18:45:16 GMT

Like the rest of you I am sure, I'd take $5 million bucks, but there is something a bit wrong when you win $15 million and only get a tad over 1/3rd of it.........

Comment #2

Just6ntlc — Wed, 04 Oct 2006 18:25:18 GMT

Congratulations to the Kansas winner stepping forward and take cash. I hope he doesn't have financial problems later in life.

Comment #1

justxploring — Wed, 04 Oct 2006 18:12:52 GMT

I like the BP/AP attitude, except I hope he keeps it in perspective. If I won a lot of money, but my car looked and ran well, I'd just get the new tires.

Kansas Powerball lottery winner claims jackpot anonymously

Lottery Post — Tue, 03 Oct 2006 17:27:00 GMT

A government worker and grandfather from the Topeka area stepped forward Monday to claim the $15 million Powerball jackpot from Wednesday's drawing.

The man, who under state law can remain anonymous, chose to take a cash lump-sum payment of $7.17 million instead of the entire amount over 29 years. After taxes, he took home a little more than $5 million.

I'm now referring to my life as BP (Before Powerball) and AP (After Powerball), he said. Last Tuesday I was worried about how I was goi... [ More ]