I saw that program.
For the most part, I found it very engaging and sometimes even funny. They all seem like people who have their heads together, but there was one part in particular that made me laugh out loud (a rare occurrence these days). The ex-con with the pony-tail ($41M, I think), took us through his mansion, pointing out his $85,000.00 chandeliers, $80,000.00 dressers, so many thousands for this, a hundred grand for that, etc. Then, he showed us his solid silver beer stein he likes to drink his whiskey from (I forget what he paid for it), and proceeded to fill it with $14.00-a-bottle Crown Royal! One would think he would have taken the trouble to acquire a taste for Walker's Blue Label scotch, or at least poured his rot-gut bourbon into a different bottle.
I think my favorite was the guy who was nearly homeless before he hit the jackpot. Living on $150.00 a month, he had enough to keep his electricity turned on and to buy canned food for himself and his cats. He was down to his last three dollars and decided to take a chance, picking his own numbers. What I like about the guy is that he has no attitude about it; he knows how lucky he was and counts his blessings every day. He hasn't forgotten who his friends were before he hit, and one friend in particular really went the extra mile to help the man claim his winnings, asking for nothing in return. We need more people like him.
The sisters (twins, I think) were an absolute riot. I think these two would have been a handful in their day, and their formidable energy is still very apparent. They live next door to each other, and built their dream house on an adjoining lot. They've had the same phone numbers since 1983, and were both appalled at the idea of having their numbers changed, fearing no one would be able to reach them.
The other stories were just as enjoyable: the old man who bought a much-needed tow truck to keep a friend from losing his business; the television engineer who now has a full-feature editing studio in his basement ("I make the best wedding videos in the neighborhood."); the woman who moved to the house on the hill, fulfilling a childhood dream. The entire program was, if I may say so, very inspirational, and I would recommend it to all members who haven't yet seen it. You'll come away with some good ideas regarding what you'll want to do after you hit the big one. It's been a long time since a TV show gave me a good feeling, but this one certainly did.
To answer the poll, I have to say that my original plans have not changed; I would not go all-out. Rather, I would invest the entire amount (less the change from the odd million - 200k, 700k, whatever it might be) for one year. This would give me enough time to set up the iron-clad trusts I want, since perpetuity of my fortune is my primary goal. Once this is done, my entire family gets an annuity for life, and so do our children, and so do their children, and so on. These annuities, paid by the interest earned on investments, are taxed at the long-term capital gains rate which, as I write this, is capped at 15%.
The above, of course, is entirely dependent upon the size of my jackpot. Since I only play PowerBall (and occasionally MegaMillions, when the prize is $80M or better), it would be impossible to organize these trusts on a $10M win; the cash option only pays $3.96M after taxes. A win like this would require much more thought and more dexterous gyrations within the financial community in order to force my windfall to grow by a factor of eight in under ten years (to $31.68M). At this point, I would revert to my original plans and set up the trusts.
I can hear people scratching their heads so I'll explain my reasoning as clearly as I can. The PowerBall jackpot begins at $10M. The cash option is 55% of the advertised jackpot, or $5.5M. Deduct another 28% for taxes, and you're left with $3.96M in cash. Invested at 5% for one year, it generates a gross income of $198,000.00. Pay your capital gains tax, and you have $168,300.00 left. Not a bad paycheck, but certainly not sufficient capital to fund more than one income-producing trust.
On the other hand, if I were to possess the lone winning ticket of a jackpot worth $80M, my share would be $31.68M, after the cash option and tax deductions. Now, with $30 million in cash, a single trust will generate (at 5%) over one million dollars every year in after-tax income. Each of five trusts will net over $200,000.00 per year, every year, until aliens destroy the Earth in an interplanetary war. $200k is the correct amount, in my opinion; it's enough to provide a decent living, allowing for housing, transportation and modest investment accounts, but it's not enough to invite the types of disasters which have plagued Jack Whittaker and his family. Inflation won't be a problem, since that factor will be offset by the increase in interest rates which must naturally follow. The key is the $30M benchmark. This is the minimum amount necessary to provide an after-tax income of one million dollars.