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cash vs. annuity

Topic closed. 267 replies. Last post 11 years ago by CASH Only.

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if you won a jackpot,pick lump sum cash or annuity

i'd pick lumo sum cash [ 82 ]  [73.21%]
i'd pick annuity [ 22 ]  [19.64%]
undecided [ 8 ]  [7.14%]
Total Valid Votes [ 112 ]  
Discarded Votes [ 7 ]  
Rick G's avatar - avatar 1766.jpg
FEMA Region V Camp #21
United States
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July 27, 2002
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Posted: February 21, 2005, 4:56 pm - IP Logged

I'd go with annuity and post my decision on here just to see the flak it causes.

 

Posted 4/6:  IL Pick 3 midday and evening until they hit:  555, 347 (str8).


    fast eddie's avatar - lasvegas2
    Chicago,IL.
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    Posted: February 21, 2005, 5:18 pm - IP Logged

      Rick you crack me up!

    "Money won is twice as sweet as money earned"

      emilyg's avatar - cat anm.gif

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      Posted: February 21, 2005, 6:01 pm - IP Logged

      if you had my   son-in-law in your family  you'd pick annuity.  he's a true believer in what's mine is his. 

                                                     

      love to nibble those micey feet.

       

                                   

        Rick G's avatar - avatar 1766.jpg
        FEMA Region V Camp #21
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        Posted: February 21, 2005, 7:11 pm - IP Logged

        Emily.....

        Eddie....wanted to go further than that but thought better of it.  But I think the state's annuity would gain me more long term profit than a lump sum would.  I'd screw it up and end up like our friend Jack W.

        But I gotta say, if you're going to play those kind of jackpot games then you have the right to decide your payoff as a winner.  I'm always surprised to hear that in some states you have to make that decision at the time of ticket purchase.  Weird.  Kind of like shooting yourself in the foot with a .50 caliber bullet before you've even won the millions-to-one odds lottery you're playing.

        I thank my lucky stars that I live and play in IL...they are fair (barring the 50% 'take' as it is in most states' pick-3/4) but they know how to run a lottery.

        Posted 4/6:  IL Pick 3 midday and evening until they hit:  555, 347 (str8).


          Annual Payments's avatar - annual 20payments.jpg
          Houston, TX
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          Posted: February 21, 2005, 7:17 pm - IP Logged
          Quote: Originally posted by willl3 on February 20, 2005



          Look, take the money because 1. your don't know what will happen in 26 years 2. will the lotto reneg on paying you full payment. 3 be in control of what is yours. You really don't win 200million its only estimated. You win what is the cash value. You're basically giving them a free loan.

          It doesn't matter any way. Its so hard to win the thing

          I've been playing since I was 18 I'm 33 and have not won more than 500$

          Playing NY lotto mega and Ct. poweball lotto





          If the jackpot is high enough and I take annual payments, it won't matter what I'm doing in 26 years because by then I'd have considerably more than I would have if I would have taken cash.  It would be mine...my check or deposit would come annually.  If I chose annual payments I would win 200 million minus taxes. 

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            Posted: February 21, 2005, 7:24 pm - IP Logged

            Why do I have to keep saying you do NOT get more if you choose annuity?

              Rick G's avatar - avatar 1766.jpg
              FEMA Region V Camp #21
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              Posted: February 21, 2005, 7:37 pm - IP Logged

              Good point about taxes....the tax code could be revised to a consumption tax as opposed to our present production tax.

              Big problem of mine...wouldn't it be more fair to tax consumption (i.e., sales tax) as opposed to production tax (i.e., income)?

              Wouldn't it simplifly our tax codes if they just took the money out of your purchases?  No loopholes, no April 15th and billions of dollars in savings running the IRS.  The software is already in place in almost all states at your local cash register.

              If you can afford a Leer Jet or a 50 foot yacht, you will pay your share of taxes.  If you can only afford a Ford Focus and beans and rice for dinner you will pay your commensurate share of taxes.  What's the problem here?

              The problem is that every person deciding on how we should be taxed needs those loopholes.

              Posted 4/6:  IL Pick 3 midday and evening until they hit:  555, 347 (str8).



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                Posted: February 21, 2005, 7:41 pm - IP Logged

                Rick:

                In November I bought a 2005 Ford Focus SES ZX3.

                  Rick G's avatar - avatar 1766.jpg
                  FEMA Region V Camp #21
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                  Posted: February 21, 2005, 7:56 pm - IP Logged

                  Cash,

                  I'm driving an '89 Bonneville...odometer stopped working a long time ago at 108,000.  I paid $150 for it. A Ford Focus would be a good thing for me right now (and beans and rice, mac and cheese are our dinners).  Hope your Focus is running good for you...good value purchase....I'd do the same but I need some trunk space for my work.  (sleeping)

                   My point was that if you got a lot of bucks it's kind of hard to launder it at the cash register.  Can't BS the purchases.  For the life of me I do not understand why our country taxes production and not consumption.  Our savings rate is one of the lowest in the major economies in the world.

                   

                  Posted 4/6:  IL Pick 3 midday and evening until they hit:  555, 347 (str8).


                    Pythagoras's avatar - nw bookeep.jpg
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                    Posted: February 21, 2005, 8:11 pm - IP Logged

                    Ha guys, don't be fooled by the lottery board. They try to convince you to take the annunity. Why? Because,

                    1. They feed you once a year with a BABY spoon

                    2. They invest their interest of the prize payout and make BIG money perhaps as much as 18%

                    3. and they know you will blow it back trying to make more.

                     

                    Take it from me, If you hit a Mega Jackpot, Cash-Out (take it all now) and Get-Out. Never pay again or you'll be sorry because, all that money will be gone.

                    In the same amount of time they are advertising the guaranteed amount to be you can double that if and only if you use your head and not your heart.

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                      Morrison, IL
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                      Posted: February 22, 2005, 9:44 am - IP Logged

                        There are people who would take the lump sum just to get taxes out of the way.  That statement is only true if you invest your lump sum in investments like municipal bonds, so the interest is tax-free, and that's only at the federal level.

                        If you took the lump sum, you'd have to invest in conservative investments to not risk losing all your winnings anyway, and you'd have to pay a third party to do it (the lottery folks will not charge), so I really don't see much improvement if you pick cash over annuity.

                        Also, do you really think you'd spend the whole year's payment in a year if you took the annuity?  Really, who needs more than $100,000 a year?

                        Annual Payments's avatar - annual 20payments.jpg
                        Houston, TX
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                        Posted: February 22, 2005, 5:10 pm - IP Logged
                        Quote: Originally posted by ryanm on February 22, 2005



                          There are people who would take the lump sum just to get taxes out of the way.  That statement is only true if you invest your lump sum in investments like municipal bonds, so the interest is tax-free, and that's only at the federal level.

                          If you took the lump sum, you'd have to invest in conservative investments to not risk losing all your winnings anyway, and you'd have to pay a third party to do it (the lottery folks will not charge), so I really don't see much improvement if you pick cash over annuity.

                          Also, do you really think you'd spend the whole year's payment in a year if you took the annuity?  Really, who needs more than $100,000 a year?




                        That's exactly what I'm saying ryan!  a couple of hundred thousand is more than enough to live on annually. 
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                          New Member
                          portland, oregon
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                          Posted: February 22, 2005, 9:54 pm - IP Logged

                          There is another choice.  Buy two seperate tickets with the same numbers (I only play Megabucks and Powerball or the Megamillions over in Washington). Then, a person can use one ticket for the cash and the other ticket for a yearly income.  I realize that with 2 tickets the cash ticket is half of half but it still buys a lot of stuff (if the jackpot is over 3 or four million dollars.  Buying 2 tickets has helped me many times even though they were not million dollar winners.  In a long run I know I've spent more money but it benefits others as well as gives me a chance to win big.  I figured it out one day in regards to the benefits of buying lottery tickets or starting a business or whatever else a person does to be financially secure....you take a chance on whatever you do and it all benifits people, one way or another.        " a newcomer"

                            ineed9million's avatar - scene sunovermountains.jpg
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                            Posted: February 22, 2005, 10:48 pm - IP Logged

                            good idea.

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                              Posted: February 23, 2005, 9:03 am - IP Logged

                              Then someone tell me if I'm wrong about this. Say the amount of the lump sum or cash jackpot was $1 million.  If I get that million in a lump sum, I have to pay 35% taxes ($350,000) right off the bat. If the state puts that million in an annuity, they do it without paying taxes, so the whole $1 million is invested to create the higher annuity jackpot amount. So the very first day I am down $350,000. With the $650,000 I have left after taxes, I then have to invest somewhere where I can not only equal the return of the state, I also have to make up that $350,000 tax loss just to equal the annuity...and while all this is going on, I don't have any of the jackpot money to spend on the good life.

                              If CO is right, can someone explain how you get more by taking the cash?

                              Quote: Originally posted by CASH Only on February 21, 2005







                              Why do I have to keep saying you do NOT get more if you choose annuity?






                                 
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