$344 MILLION: Mega Millions lottery jackpot skyrockets

Dec 7, 2013, 9:19 am (102 comments)

Mega Millions

10th-largest US jackpot of all time

By Todd Northrop

This holiday season someone will be able to afford gifts unlike any they have ever given before, as the multi-state Mega Millions lottery jackpot is soaring to historic levels.

After nobody won Friday night's grand prize, the Mega Millions jackpot grew to an estimated $344 million — the largest since the record-setting $656 million jackpot set on March 30, 2012, and the 10th-largest United States lottery jackpot of all time (see full list below).

The lump-sum cash value also rose to a knee-weakening $184 million.

Tuesday's Mega Millions jackpot is the accumulation of 19 consecutive drawings without a top prize winner. The current jackpot run-up started on October 4 as a $12 million grand prize — it has been more than two months since Mega Millions has had a jackpot winner.

Lottery players can see an after-tax analysis of the current Mega Millions jackpot by visiting USA Mega's Jackpot Analysis page.

Players should note that jackpot amounts are conservative estimates provided by the lotteries, and are often somewhat higher by the time the drawing occurs. Occasionally the official jackpot estimate is raised even before the drawing, due to larger-than-expected sales.

In Friday night's Mega Millions drawing, there was no jackpot winner, but 4 lucky players matched the first 5 numbers for a $1,000,000 prize: 1 from Illinois, 1 from Michigan, 1 from Ohio, and 1 from Washington.

Unfortunately, none of the four second-prize winners purchased their ticket with the Megaplier option for an extra $1 per play.  If they had, their prize would have been increased to $3 million, because the Megaplier number drawn was 3.

The Megaplier option is not available in California, because the fixed nature of the prize increase offered with the Megaplier is not compatible with California's pari-mutuel payouts. By law, California awards all prizes on a pari-mutuel basis, meaning the prizes will change each drawing based on the number of tickets sold and the number of tickets that won at each prize level.

Also, a total of 77 tickets matched four of the first five numbers plus the Mega Ball to win a $5,000 prize. Of those tickets, 9 were sold in California, where the prize awarded this drawing is $5,220.

The Mega Millions winning numbers for Friday, December 6, 2013, were 11, 29, 44, 63, and 64, with Mega Ball number 3. The Megaplier number was 3.

Ineterestingly, it is the second drawing in a row in which both the Mega Ball and Megaplier were 3.  In fact, the Mega Ball number has been a 3 in three of the last four drawings.

Following the Friday drawing, the Mega Millions annuity jackpot estimate was raised $47 million from its previous amount of $297 million. The cash value was raised by $25.1 million, from its previous amount of $158.9 million. 

The official jackpot estimates for Friday's drawing were raised prior to the drawing due to stronger-than-expected sales.  (See $297 MILLION: Mega Millions jackpot raised again before tonight's drawing, Lottery Post, Dec. 6, 2013.)

Mega Millions is currently offered for sale in 43 states, plus Washington, D.C. and the U.S. Virgin Islands. Drawings are Tuesdays and Fridays at 11:00 pm Eastern Time. Tickets cost $1 each.

A 44th Mega Millions state may be added in early 2014, as the state of Wyoming has approved a new state lottery with the intention of joining multi-state lottery games. (See Wyoming officially becomes 44th state with a lottery, Lottery Post, Mar. 14, 2013.)

The Mega Millions winning numbers are published at USA Mega (www.usamega.com) minutes after the drawing takes place.

Top 25 United States lottery jackpots of all time

Tuesday's Mega Millions jackpot currently stands as the 10th-largest lottery jackpot of all time in the United States.  That position may rise before the drawing, as lotteries are typically conservative in their initial estimates, and brisk sales may push the jackpot estimate higher by draw time.

  1. Mega Millions: $656 million, Mar. 30, 2012 - Illinois, Kansas, Maryland
  2. Powerball: $590.5 million, May 18, 2013 - Florida
  3. Powerball: $587.5 million, Nov. 28, 2012 - Arizona, Missouri
  4. Powerball: $448.4 million, Aug. 7, 2013 - Minnesota, New Jersey (2)
  5. Powerball: $399.4 million, Sep. 18, 2013 - South Carolina
  6. Mega Millions: $390 million, Mar. 6, 2007 - Georgia, New Jersey
  7. Mega Millions: $380 million, Jan. 4, 2011 - Idaho, Washington
  8. Powerball: $365 million, Feb. 18, 2006 - Nebraska
  9. The Big Game: $363 million, May 9, 2000 - Illinois, Michigan
  10. Mega Millions: $344 million, Dec. 10, 2013 - Preliminary estimate, not won yet
  11. Powerball: $340 million, Oct. 19, 2005 - Oregon
  12. Powerball: $338.3 million, Mar. 23, 2013 - New Jersey
  13. Powerball: $337 million, Aug. 15, 2012 - Michigan
  14. Powerball: $336.4 million, Feb. 11, 2012 - Rhode Island
  15. Mega Millions: $336 million, Aug. 28, 2009 - California, New York
  16. The Big Game: $331 million, Apr. 16, 2002 - Georgia, Illinois, New Jersey
  17. Mega Millions: $330 million, Aug. 31, 2007 - Maryland, New Jersey, Texas, Virginia
  18. Mega Millions: $319 million, Mar. 25, 2011 - New York
  19. Mega Millions: $315 million, Nov. 15, 2005 - California
  20. Powerball: $314.9 million, Dec. 26, 2002 - West Virgina
  21. Powerball: $314.3 million, Aug. 25, 2007 - Indiana
  22. Powerball: $295.7 million, Jul. 29, 1998 - Indiana
  23. Powerball: $295 million, Aug. 25, 2001 - Delaware, Kentucky, Minnesota, New Hampshire
  24. Mega Millions: $294 million, Jul. 2, 2004 - Massachusetts
  25. Powerball: $276.3 million, Mar. 15, 2008 - West Virgina

For those keeping score, the number of jackpots in the top 25, by lottery game, are:

  • Mega Millions: 9
  • Powerball: 14
  • The Big Game: 2

The Big Game is the original name of Mega Millions, from the game's first drawing on Sep. 6, 1996 through May 14, 2002.  The name was changed to Mega Millions starting with the May 17, 2002 drawing.

Top 25 cash value jackpots

Since many lottery winners collect their winnings in cash, the lump-sum payout is an important measure of what a winning ticket could be worth.

Looking at the cash value, the upcoming Mega Millions jackpot ranks as the 15th-largest cash value in U.S. history.

  1. Mega Millions: $471 million cash, Mar. 30, 2012 ($656 million annuity) - Illinois, Kansas, Maryland
  2. Powerball: $384.7 million cash, Nov. 28, 2012 ($587.5 million annuity) - Arizona, Missouri
  3. Powerball: $370.9 million cash, May 18, 2013 ($590.5 million annuity) - Florida
  4. Powerball: $258.2 million cash, Aug. 7, 2013 ($448.4 million annuity) - Minnesota, New Jersey (2)
  5. Mega Millions: $240 million cash, Jan. 4, 2011 ($380 million annuity) - Idaho, Washington
  6. Mega Millions: $233.1 million cash, Mar. 6, 2007 ($390 million annuity) - Georgia, New Jersey
  7. Powerball: $224.7 million cash, Aug. 15, 2012 ($337 million annuity) - Michigan
  8. Powerball: $223.3 million cash, Sep. 18, 2013 ($399.4 million annuity) - South Carolina
  9. Mega Millions: $214 million cash, Aug. 28, 2009 ($336 million annuity) - California, New York
  10. Powerball: $211 million cash, Mar. 23, 2013 ($338.3 million annuity) - New Jersey
  11. Powerball: $210 million cash, Feb. 11, 2012 ($336.4 million annuity) - Rhode Island
  12. Mega Millions: $202.9 million cash, Mar. 25, 2011 ($319 million annuity) - New York
  13. Mega Millions: $194.4. million cash, Aug. 31, 2007 ($330 million annuity) - Maryland, New Jersey, Texas, Virginia
  14. Mega Millions: $185 million cash, Nov. 15, 2005 ($315 million annuity) - California
  15. Mega Millions: $184 million cash, Dec. 10, 2013 ($344 million annuity) - Preliminary estimate, not won yet
  16. The Big Game: $180 million cash, May 9, 2000 ($363 million annuity) - Illinois, Michigan
  17. Powerball: $177.3 million cash, Feb. 18, 2006 ($365 million annuity) - Nebraska
  18. Mega Millions: $168 million cash, July 2, 2004 ($294 million annuity) - Massachusetts
  19. Mega Millions: $167.7 million cash, Feb. 22, 2008 ($275 million annuity) - Georgia
  20. Powerball: $166 million cash, Aug. 25, 2001 ($295 million annuity) - Delaware, Kentucky, Minnesota, New Hampshire
  21. Mega Millions: $165.2 million cash, May 4, 2010 ($266 million annuity) - California
  22. Powerball: $164.4 million cash, won Oct. 19, 2005 ($340 million annuity) - Oregon
  23. Mega Millions: $164 million cash, Feb. 28, 2006 ($270 million annuity) - Ohio
  24. Powerball: $161.5 million cash, July 29, 1998 ($295.7 million annuity) - Indiana
  25. Mega Millions: $156.1 million cash, Sept. 16, 2005 ($258 million annuity) - New Jersey

Lottery Post Staff

Comments

dpoly1's avatardpoly1

About $110,000,000 after Federal Redistribution!

I'll take it!

Good luck to all LP Members ..............

Party

DDOH937's avatarDDOH937

What is the Deal with These People Not Spending the extra ONE DOLLAR for MEGA PLAY???? Congrats to them but COME ON!!!!! Remember people, the jackpot odds are through the roof, so it makes sense to hedge for the maximum amount second/third/fourth place prize. Get it together people!!! hahahaha

peppy007

Quote: Originally posted by DDOH937 on Dec 7, 2013

What is the Deal with These People Not Spending the extra ONE DOLLAR for MEGA PLAY???? Congrats to them but COME ON!!!!! Remember people, the jackpot odds are through the roof, so it makes sense to hedge for the maximum amount second/third/fourth place prize. Get it together people!!! hahahaha

The reason being that the majority of those people are simply playing for the jackpot and not the lowerprices. They want two chances at the jackpot insgead of one chance at it for the same price. For a second prize of 2 to 5 millions most people prefer to play the state lottery which has way better odds at winning those amounts. Hope that helped.

DDOH937's avatarDDOH937

Quote: Originally posted by peppy007 on Dec 7, 2013

The reason being that the majority of those people are simply playing for the jackpot and not the lowerprices. They want two chances at the jackpot insgead of one chance at it for the same price. For a second prize of 2 to 5 millions most people prefer to play the state lottery which has way better odds at winning those amounts. Hope that helped.

Hear Hear!!!!!

helpmewin's avatarhelpmewin

the annuity part sounds good to me Dance

DDOH937's avatarDDOH937

Quote: Originally posted by helpmewin on Dec 7, 2013

the annuity part sounds good to me Dance

If it gets to $900 million plus, would you opt for annuity or cash payout????

Slick Nick's avatarSlick Nick

Ya gotta be in it to win it! LOL

mightwin's avatarmightwin

Looks like now the jackpot would have to be near a billion for the cash option to have an attempt to take the top spot

sully16's avatarsully16

This one is going to keep growing.

Viking Orayk's avatarViking Orayk

110 Mil +, After Feds cut".…....Party

 

 

Anyone got a ballpark idea of how much money you would make a month

on simple interest?? I've run out fingers and toes to count on.What?

DDOH937's avatarDDOH937

Quote: Originally posted by Slick Nick on Dec 7, 2013

Ya gotta be in it to win it! LOL

YES SLICK!!!! The chances of winning are next to impossible, but someone has to win, mathematics and the law of Physics insists on this!!!! Gotta to be in it. Good luck to you for a second prize winner x 5 multiplier. Jackpot already assigned to me by the Universe: Smash

stunna6036's avatarstunna6036

Good luck everyone. .......I'm in it to win itNoellParty

mypiemaster's avatarmypiemaster

Quote: Originally posted by DDOH937 on Dec 7, 2013

What is the Deal with These People Not Spending the extra ONE DOLLAR for MEGA PLAY???? Congrats to them but COME ON!!!!! Remember people, the jackpot odds are through the roof, so it makes sense to hedge for the maximum amount second/third/fourth place prize. Get it together people!!! hahahaha

Smart players always play MM with megaplier.

mypiemaster's avatarmypiemaster

$344M after 19 draws?. Sorry guys, not growing fast enough. Maybe it's JP fatigue. I thought by now, it should be somewhere near $650M. Yaaaaaawn.Bed

Todd's avatarTodd

Quote: Originally posted by mypiemaster on Dec 7, 2013

$344M after 19 draws?. Sorry guys, not growing fast enough. Maybe it's JP fatigue. I thought by now, it should be somewhere near $650M. Yaaaaaawn.Bed

The first 5 drawings in the current jackpot run were under the old rules, using the old starting jackpot amount.  So the new rules show that the Mega Millions jackpot can once again grow hugely, but is not an accurate representation of how many rolls it should take to get there.

Slick Nick's avatarSlick Nick

I think it's safe to say that there will always be larger jackpots in the very end, but it'll take longer to win. Picking numbers 1 to 75 is a bit of a chore!Let It All Out

RedStang's avatarRedStang

The guy running our work pool usually asks for 2$. This time i gave him 10$ to cover the next 5 draws. He told me to think positive. Conehead

Slick Nick's avatarSlick Nick

Pools are a good thing. For years I have had a few guys I work with in a pool. I use to run big group lotterys at work, but I just have 1 or 2 now. Think positive are good words RedStang.  I Agree!

chucklesmcgee

No, it doesn't make sense at all to pay for Mega Play. The expected value is absolutely terrible. I realize this is the lottery after all and tickets basically never have a postive expected value, but spending that extra dollar on another ticket will give you a much better payout potential than spending it on a Mega Play. Most of the expected payout in big lottery games comes from the jackpot, not the lower prizes. Of course, the best expected outcome would be not spending that dollar or any dollars on lottery tickets and investing it instead. But I assume we're hear to have fun, so spend your $2 on two tickets, not one with a Mega Play.

chucklesmcgee

No, the megaplier gives terrible expected payout (as though lottery odds were good to begin with). The idea of a "smart lottery player" is also a bit of an oxymoron.

helpmewin's avatarhelpmewin

Quote: Originally posted by DDOH937 on Dec 7, 2013

If it gets to $900 million plus, would you opt for annuity or cash payout????

Blue Thinking

schmuckatelly's avatarschmuckatelly

$1+ billion January 7th.

VFR95's avatarVFR95

Quote: Originally posted by schmuckatelly on Dec 7, 2013

$1+ billion January 7th.

Seasons Greetings Schmuckatelly,

 

     I'm gonna go with $1+ billion on Christmas Eve..........for a very Merry Christmas.

 

Dreamer,

Teddi's avatarTeddi

Quote: Originally posted by DDOH937 on Dec 7, 2013

If it gets to $900 million plus, would you opt for annuity or cash payout????

If an annuity was going to pay out $30 million to $40 million a year, then I think I'd actually consider taking the annuity. I may not do it but I would definitely stop and think about it.

Because even though I expect taxes on that kind of income to increase and I usually hate the idea of payments spread out over so many years, with the cash value is so low and the annuity payments so large, you could end up equalling the cash value in less than 15 years. Plus 30 million a year is enough to live off of...very very well, and also b able to invest enough to make a good chunk from interest payments. Definitely an interesting thought.

mypiemaster's avatarmypiemaster

Quote: Originally posted by chucklesmcgee on Dec 7, 2013

No, the megaplier gives terrible expected payout (as though lottery odds were good to begin with). The idea of a "smart lottery player" is also a bit of an oxymoron.

So you consider yourself a losing winner, or a winning loser for playing the lottery or you just love to whine?. I forgot, you never spend money to play the lottery, you just play on paper for fun. I hope you are not one of those clerks, that show up here and tell us that they found winning tickets in the trash bin, because they are real morons. Consider this cruel kindness. Here's to oxymoronsEvil UhhSad Cheers

DDOH937's avatarDDOH937

Quote: Originally posted by Teddi on Dec 7, 2013

If an annuity was going to pay out $30 million to $40 million a year, then I think I'd actually consider taking the annuity. I may not do it but I would definitely stop and think about it.

Because even though I expect taxes on that kind of income to increase and I usually hate the idea of payments spread out over so many years, with the cash value is so low and the annuity payments so large, you could end up equalling the cash value in less than 15 years. Plus 30 million a year is enough to live off of...very very well, and also b able to invest enough to make a good chunk from interest payments. Definitely an interesting thought.

Good Post Teddi...My line of thinking precisely. I find it quite hilarious when i hear people churp at the idea of walking away with an even $20mil a year basically for LIFE (29 years). With the same investment approach, one could easily recapture the initial cash amount in 10-15 years as you pointed out. Plus the added bonus of not becoming one of the statistics that end up broke in 3-5 years. At this level ($344 mil) it would be about 12 million a year which might not be enough to offset the difference, but even that's a GREAT deal. Longevity is the key and for some strange reason, so many people go broke so quickly after winning. And its not just poor spending...Look at Lehman, look at Madoff, look at Stanford. Well intentioned investors can easily be wiped out even if you're quite prudent. Something worth considering I propose.

savagegoose's avatarsavagegoose

lol 20 mill a year to start the ball rolling upto 100m a year at the end of 30 years

Toronto

Quote: Originally posted by Teddi on Dec 7, 2013

If an annuity was going to pay out $30 million to $40 million a year, then I think I'd actually consider taking the annuity. I may not do it but I would definitely stop and think about it.

Because even though I expect taxes on that kind of income to increase and I usually hate the idea of payments spread out over so many years, with the cash value is so low and the annuity payments so large, you could end up equalling the cash value in less than 15 years. Plus 30 million a year is enough to live off of...very very well, and also b able to invest enough to make a good chunk from interest payments. Definitely an interesting thought.

You also have to consider interest rates are near all time lows and nearly any economist or investor knows that low rates will not be here forever. The headline jackpot assumes investing risk-free at the current rate level. Rates are expected to rise over the next few years. Taking annuity right now is not prudent (including, as you said, current tax levels and seemingly the only way we will solve our deficits will include some raising of taxes)

DDOH937's avatarDDOH937

Quote: Originally posted by Toronto on Dec 7, 2013

You also have to consider interest rates are near all time lows and nearly any economist or investor knows that low rates will not be here forever. The headline jackpot assumes investing risk-free at the current rate level. Rates are expected to rise over the next few years. Taking annuity right now is not prudent (including, as you said, current tax levels and seemingly the only way we will solve our deficits will include some raising of taxes)

I hear you Toronto but not so sure i'm with you 100% on this one. I understand that current low interest rates are responsible for a larger cash payout now. Which one would be inclined to capitalize one. But doesn't your argument goes both ways? That if interest rates WILL eventually go up and taxes fluctuate...Dems vs Reps in power, then one will have a fair opportunity to invest much of that $30 million each year and receive reasonable if not very attractive returns? And remember, we're not just talking about gaining a few percentage on investments here and there, i'm talking about GUARANTEED lucrative income for 29 years. Income that can and would serve to buffer market gyrations.

En ReVal

I agree, too many numbers to choose from.  Players may have become disinterested.

TheGameGrl's avatarTheGameGrl

I've got odds that even if someone wins, the check wouldn't be cut til next year. 

Personally after seeing the odds and the amount of low end winners in my state (PA), I'll stick to the one dollar play . It only takes a dollar to win the jackpot and the lower prizes just don't have enough incentive.

I guestimate it to hit when its around the 600 million marker. (between two to three states will hit it)

Thats my story and I'm sticking to it.

Win$500Quick's avatarWin$500Quick

Quote: Originally posted by TheGameGrl on Dec 7, 2013

I've got odds that even if someone wins, the check wouldn't be cut til next year. 

Personally after seeing the odds and the amount of low end winners in my state (PA), I'll stick to the one dollar play . It only takes a dollar to win the jackpot and the lower prizes just don't have enough incentive.

I guestimate it to hit when its around the 600 million marker. (between two to three states will hit it)

Thats my story and I'm sticking to it.

I Agree! I am boycotting by spending $1 per draw. With these astronomical odds I rather spend my money on Florida Lottery Games such as Fantasy 5, Mega Money and Lotto which have better odds.

Win$500Quick's avatarWin$500Quick

Quote: Originally posted by peppy007 on Dec 7, 2013

The reason being that the majority of those people are simply playing for the jackpot and not the lowerprices. They want two chances at the jackpot insgead of one chance at it for the same price. For a second prize of 2 to 5 millions most people prefer to play the state lottery which has way better odds at winning those amounts. Hope that helped.

I Agree!

Teddi's avatarTeddi

Quote: Originally posted by Toronto on Dec 7, 2013

You also have to consider interest rates are near all time lows and nearly any economist or investor knows that low rates will not be here forever. The headline jackpot assumes investing risk-free at the current rate level. Rates are expected to rise over the next few years. Taking annuity right now is not prudent (including, as you said, current tax levels and seemingly the only way we will solve our deficits will include some raising of taxes)

Like I said, I'm not a fan of annuities. I think that generally they are a rip off. Espcially since they are weighted for you to get more in the last few years than on the front end. But let's  just say the JP reaches a point where you can actually take home $30M per year, and the CV is somewhere around 50%, those 2 factors would give me pause.


Simply something to consider since my usual way of thinking is never to take the annuity.

savagegoose's avatarsavagegoose

Quote: Originally posted by Teddi on Dec 7, 2013

Like I said, I'm not a fan of annuities. I think that generally they are a rip off. Espcially since they are weighted for you to get more in the last few years than on the front end. But let's  just say the JP reaches a point where you can actually take home $30M per year, and the CV is somewhere around 50%, those 2 factors would give me pause.


Simply something to consider since my usual way of thinking is never to take the annuity.

and the fact that $20 mill a year would be like wining the lotto every year anyhow. if you managed to save say %10 l a year of that and invest it, after the 30 years, yu would prob still be taking in 20 mill for ever.

DDOH937's avatarDDOH937

Quote: Originally posted by savagegoose on Dec 7, 2013

and the fact that $20 mill a year would be like wining the lotto every year anyhow. if you managed to save say %10 l a year of that and invest it, after the 30 years, yu would prob still be taking in 20 mill for ever.

My point EXACTLY goose man. One would basically be winning the pot EVERY YEAR!!!!  Smash

jjtheprince

I see four cheats got 5+0 on this one.

BBLL's avatarBBLL

Christmas jackpot Big Grin Santa

rdgrnr's avatarrdgrnr

Quote: Originally posted by jjtheprince on Dec 7, 2013

I see four cheats got 5+0 on this one.

Well, I hope you notified the authorities.

They probably had cheat sheets.

KY Floyd's avatarKY Floyd

Quote: Originally posted by mightwin on Dec 7, 2013

Looks like now the jackpot would have to be near a billion for the cash option to have an attempt to take the top spot

I think the record cash value was fairly close to $475 million. Based on that, the current annuity value will need to reach about $888 million to tie the record.

656 = 888.  There's some lottery math for you. If this run gets within 25% of setting a new record lottery officials will be hoarse from screaming about the new record they set.

golfer1960's avatargolfer1960

Quote: Originally posted by DDOH937 on Dec 7, 2013

If it gets to $900 million plus, would you opt for annuity or cash payout????

Wow, that's such a ridiculous amount of money. I think I'd opt for the annunity!! I think that would be around $30M per year for 30-yrs.

jjtheprince

Not cheat sheets, cheat codes.

LottoMetro's avatarLottoMetro

Quote: Originally posted by golfer1960 on Dec 7, 2013

Wow, that's such a ridiculous amount of money. I think I'd opt for the annunity!! I think that would be around $30M per year for 30-yrs.

With a $900M annuity, you wouldn't see the first gross $30M+ payment until 2030 (technically, 2031). Of course the average payment over the course of the annuity would be $30M, but the first gross payment would be less than $14M.

The annuity would have to be nearly $2 billion to see a gross $30M payment upfront. Crazy

golfer1960's avatargolfer1960

Quote: Originally posted by LottoMetro on Dec 7, 2013

With a $900M annuity, you wouldn't see the first gross $30M+ payment until 2030 (technically, 2031). Of course the average payment over the course of the annuity would be $30M, but the first gross payment would be less than $14M.

The annuity would have to be nearly $2 billion to see a gross $30M payment upfront. Crazy

Oh okay. Still lots of money eh, Metro? Would you take the cash or annuity?

weshar75's avatarweshar75

If I get lucky on my ticket this tuesday night I am taking the cash because I will never spend that amount of money in my life time.-weshar75

US Flag

golfer1960's avatargolfer1960

I'm thinking sun and fun if I win.

Waldorf Astoria Key West

LottoMetro's avatarLottoMetro

Quote: Originally posted by golfer1960 on Dec 7, 2013

Oh okay. Still lots of money eh, Metro? Would you take the cash or annuity?

I would probably consider annuity if it was $1 billion or more, just because I don't have one foot in the grave yet Jester

Otherwise cash for the following reasons:

1) Regarding taxation, lump sum penalizes about half a percent versus annuity but that is under current rates only. Taxes are more likely to go up than down in the future, so it would be better to pay up now and never have to pay again (other than on interest, investments etc) rather than risk a higher rate down the road.

2) Say you feel strongly that you could earn "at least" 5% (~3% annual yield is required to match annuity) on your money. With the cash up front you already have a headstart and can use the power of compounding. Earning 5% on the lump sum beats the annuity with 5% additional return. So if you got the annuity and earned 5% on top of the premium packed into your payment, it would be less than if you had taken the cash and invested it at 5% return.

Of course, the scaling effect can potentially diminish returns on the lump sum (hence why I would consider annuity over $1 billion), you can lose it faster, etc. while the annuity guarantees an inflation-padded, steady stream of income.

3) Obviously, nobody is guaranteed another day (government/creditors included!) so might as well enjoy life and your money while you can! Wink

rdgrnr's avatarrdgrnr

Quote: Originally posted by jjtheprince on Dec 7, 2013

Not cheat sheets, cheat codes.

Yeah, I was using code (cheat sheets) to describe cheat codes.

But now you've blown the whole operation.

ashabug725's avatarashabug725

I would take the cash option simply to make sure that if something happened to me the $$$$ would go to my children!!

DC81's avatarDC81

Quote: Originally posted by jjtheprince on Dec 7, 2013

Not cheat sheets, cheat codes.

Did the input Up, Up, Down, Down, Left, Right, Left, Right, B, A?

Masone

Quote: Originally posted by LottoMetro on Dec 7, 2013

I would probably consider annuity if it was $1 billion or more, just because I don't have one foot in the grave yet Jester

Otherwise cash for the following reasons:

1) Regarding taxation, lump sum penalizes about half a percent versus annuity but that is under current rates only. Taxes are more likely to go up than down in the future, so it would be better to pay up now and never have to pay again (other than on interest, investments etc) rather than risk a higher rate down the road.

2) Say you feel strongly that you could earn "at least" 5% (~3% annual yield is required to match annuity) on your money. With the cash up front you already have a headstart and can use the power of compounding. Earning 5% on the lump sum beats the annuity with 5% additional return. So if you got the annuity and earned 5% on top of the premium packed into your payment, it would be less than if you had taken the cash and invested it at 5% return.

Of course, the scaling effect can potentially diminish returns on the lump sum (hence why I would consider annuity over $1 billion), you can lose it faster, etc. while the annuity guarantees an inflation-padded, steady stream of income.

3) Obviously, nobody is guaranteed another day (government/creditors included!) so might as well enjoy life and your money while you can! Wink

That's true, but at the same time, there aint a whole lot you can't buy with the 14m to 30m a year you'd be making with that annuity. Even if you encountered things you couldn't buy, no one in their right mind is going to sit there and deny you credit.

I think if it hit a mark of 900 million, I'd just take the annuity. That's an average of 18 million a year after taxes at the current rate, but then again, taxes are likely to increase. But will it increase to the point where losing 50% of your money by taking the lump sum is worth it?

BuyLow's avatarBuyLow

Looks like it will jump to 4th largest jackpot ever if not hit Tuesday.......!!!! 

 

I am ready for a win!  Florida has not ever won a MM Jackpot, I will accept on their behalf!!

BuyLow's avatarBuyLow

Quote: Originally posted by golfer1960 on Dec 7, 2013

I'm thinking sun and fun if I win.

Waldorf Astoria Key West

Great resort but the beach (if thats what you are looking for) in front is rocks for the most part......lots of activities, location off the busy streets but close to everything.

Thegreenpirate

That <snip> Contra to nintendo!!!! LMFAO @ up,up, down, down, left-right left-right b, a, b, a, select, start, I'm the $344,000,000 Jackpot winner in Ohio 12/10/13!!!!

This post has been automatically changed by the Lottery Post computer system to remove inappropriate content and/or spam.

Thegreenpirate

Florida won enough money this year they need a hiatus!!!!

WWWBUKTN

Where is the, "I constantly come on a messgeboard to talk about it so I may buy one ticket this week but I'm kind of waiting for it to get bigger" crowd.

 

Just laughable.

savagegoose's avatarsavagegoose

around 60k a month at %1 interest and a %30 tax  rate.   maybe multiply that by what ever interest you think you could get like 5% would be 5x or 300k a month

sully16's avatarsully16

Quote: Originally posted by golfer1960 on Dec 7, 2013

I'm thinking sun and fun if I win.

Waldorf Astoria Key West

Nice

Goteki54's avatarGoteki54

Now is about the time the causal players are starting to buy into.  If I had the 2nd prize of 1 million, I would still be smiling all the way to the bank.

Viking Orayk's avatarViking Orayk

Quote: Originally posted by LottoMetro on Dec 7, 2013

I would probably consider annuity if it was $1 billion or more, just because I don't have one foot in the grave yet Jester

Otherwise cash for the following reasons:

1) Regarding taxation, lump sum penalizes about half a percent versus annuity but that is under current rates only. Taxes are more likely to go up than down in the future, so it would be better to pay up now and never have to pay again (other than on interest, investments etc) rather than risk a higher rate down the road.

2) Say you feel strongly that you could earn "at least" 5% (~3% annual yield is required to match annuity) on your money. With the cash up front you already have a headstart and can use the power of compounding. Earning 5% on the lump sum beats the annuity with 5% additional return. So if you got the annuity and earned 5% on top of the premium packed into your payment, it would be less than if you had taken the cash and invested it at 5% return.

Of course, the scaling effect can potentially diminish returns on the lump sum (hence why I would consider annuity over $1 billion), you can lose it faster, etc. while the annuity guarantees an inflation-padded, steady stream of income.

3) Obviously, nobody is guaranteed another day (government/creditors included!) so might as well enjoy life and your money while you can! Wink

well said"

I especially agree with number 3.  I Agree! 

Teddi's avatarTeddi

Quote: Originally posted by ashabug725 on Dec 8, 2013

I would take the cash option simply to make sure that if something happened to me the $$$$ would go to my children!!

If anything happened to you, the lottery still has to pay out the annuity, and those annuity payments would go to your estate, so your children would still get the money, whether you are alive or not to give it to them. While I'm all for taking the cash option, wanting to leave your kids your lottery winnings isn't a reason to forego the annuity. Annuity payments don't stop simply because you die. They'll be covered either way.  Especially if you set up trust funds for them.

Jill34786's avatarJill34786

While relaxing here in Colorado, a friend of mine somehow talked me into contributing towards an MM pool with her and another friend staying with us. At first she wanted $20 from each of us and I frowned at the idea as I haven't even purchased a single ticket for this new matrix yet.

We ended up compromising and decided to apply each of our $20 towards 5-draws which is good through December 24th...I figure this would be a good reason to head back out west in the event the lottery Gods blessed us. Smile

Jill34786's avatarJill34786

Quote: Originally posted by golfer1960 on Dec 7, 2013

I'm thinking sun and fun if I win.

Waldorf Astoria Key West

Golfer- I think you would be right at home relaxing at this resort. Just remember my advice on always taking the lump cash option.

Good luck to you!

RedStang's avatarRedStang

Quote: Originally posted by Win$500Quick on Dec 7, 2013

I Agree! I am boycotting by spending $1 per draw. With these astronomical odds I rather spend my money on Florida Lottery Games such as Fantasy 5, Mega Money and Lotto which have better odds.

Would'nt call spending a dollar Boycotting Blue Thinking.   You're actually doing what they planned for.

Teddi's avatarTeddi

Quote: Originally posted by Jill34786 on Dec 8, 2013

Golfer- I think you would be right at home relaxing at this resort. Just remember my advice on always taking the lump cash option.

Good luck to you!

Hey Jill, I've been waiting on you to throw your hat in because I think you and I both see eye to eye on this CV vs annuity debate. However, since certain possibilities have given me pause to consider the annuity as a viable option, I wanted to get your professional take on this. 

Let's pretend circumstances presented itself so that the JP became large enough to pay out $30 to $40 million per year and the CV was 50% or less. Would choosing the cash still be a better value than opting for the annuity in such a case?

Jill34786's avatarJill34786

Quote: Originally posted by Teddi on Dec 8, 2013

Hey Jill, I've been waiting on you to throw your hat in because I think you and I both see eye to eye on this CV vs annuity debate. However, since certain possibilities have given me pause to consider the annuity as a viable option, I wanted to get your professional take on this. 

Let's pretend circumstances presented itself so that the JP became large enough to pay out $30 to $40 million per year and the CV was 50% or less. Would choosing the cash still be a better value than opting for the annuity in such a case?

Hi Teddi- With the way annuities are structured for MM, it would take a jackpot of over 3 billion in order to support initial annual payments of $30 million and this is just with the initial 25% Federal and typical 5% state withholding which.

Using the current jackpot as a basis ($344M annuity/ $184M cash) tripling this amount to 1.032 billion/$552 million cash. The first distribution would be $15.5M gross/$10.8M after-30% taxes. It would take 7 years before the pre-tax payment would even exceed $20 million.

Taking the lump sum and factoring a nominal 3% return would far exceed the annuity progressive return. Taxes play an important role as the future is extremely uncertain and I have no doubt the rates will rise.

With the lump sum payout (based on 1.032 Billion annuity) of $552 million/ $386 million after 30% tax, a modest 5% return would yield over $19.3 million.

I always recommend the cash over the annuity even if the CV was 50% or less. There are many ways to let the money work for you such as contributing a large amount toward your own charitable trust, not only will this mitigate your Federal taxes but you will have the option of hiring friends and family to monitor the trust.

I would advise anyone who gets a large windfall to meet with several Certified Financial Planner (CFP) and CPA/Tax accountant before choosing either option.

Jill34786's avatarJill34786

Another point I would like to make about taking the cash option instead of the annuity is the ability to let it grow without touching the principal

Using this current $344M jackpot which offers a CV of $184M the net payout after 39.6% Federal tax is applied would be a little over $111 million. Just for comparison the $344 annuity would amount to a $207 million take home pay if the current top tier Fed rate didn't change over the next 29 years (which is unlikely).

Investing $100 million using a diverse approach with a qualified team of financial advisers/money manager should easily bring conservative returns of at least 6-8% annually. Under a slightly more aggressive approach, 12-15% is completely possible.

I would suggest the milder goal of 6-8% as over the span of 30-years, you would have far exceeded the return of the lottery annuity without ever making a dent in the principal.

One-Day

After giving it a lot of thought, I'm going with the annuity option guys. :)  I'll invest a lot of the first payment smartly in some good technology startups and have the cash value in less than 15 years. :)   How much money does a man need to live?  I don't need that lump sum payment the first time.  Afraid I lose it all somehow.  I'll write a good will leaving future payments to my daughter. I got this, rgdr...  :)

I almost got it once.  This time it won't escape me.  https://www.lotterypost.com/thread/265134

CAL-LottoPlayer

Quote: Originally posted by One-Day on Dec 8, 2013

After giving it a lot of thought, I'm going with the annuity option guys. :)  I'll invest a lot of the first payment smartly in some good technology startups and have the cash value in less than 15 years. :)   How much money does a man need to live?  I don't need that lump sum payment the first time.  Afraid I lose it all somehow.  I'll write a good will leaving future payments to my daughter. I got this, rgdr...  :)

I almost got it once.  This time it won't escape me.  https://www.lotterypost.com/thread/265134

Unfortunately, the MegaMillions managers have changed their game:

MegaMillions Has Changed:  "The odds of winning a jackpot changed from 1 in 176 million, to 1 in 259 million."

It's now almost impossible to win.  They increased the odds by 50% so it would be harder to win and the jackpots would increase.

I don't know about you guys, but I'm going to ignore this game until it goes to $700 Million.  That's what the managers wanted anyway.  Bed  Then I'll play 10 bucks.

golfer1960's avatargolfer1960

Quote: Originally posted by Jill34786 on Dec 8, 2013

Golfer- I think you would be right at home relaxing at this resort. Just remember my advice on always taking the lump cash option.

Good luck to you!

Thanks Jill! I hope you're enjoying your vacation in CO. I've never been there but it looks like a beautiful state with snow capped mountains. I hope you're skiing out there?

Good luck to you and your friends too!! :)

Aspen, CO ski resort Colorado ski trip Colorado Colorado

Jill34786's avatarJill34786

Quote: Originally posted by golfer1960 on Dec 9, 2013

Thanks Jill! I hope you're enjoying your vacation in CO. I've never been there but it looks like a beautiful state with snow capped mountains. I hope you're skiing out there?

Good luck to you and your friends too!! :)

Aspen, CO ski resort Colorado ski trip Colorado Colorado

Hi golfer-we are really enjoying ourselves here in Aspen which btw happens to coincide with some of the pics you posted:)
My children as well as the adults have been participating in both skiing and snowboarding.
We pooled our money for 5 draws starting the 10th...peer pressure.
Good luck to you as well!

surimaribo24's avatarsurimaribo24

wow . someone's live will change tom  . night . 

goodluck everyone .

Jon D's avatarJon D

I agree with most that say always take the cash.

The annuity is mainly a gimmick to inflate the Jackpot for sales and marketing purposes...and it works!

It may have made more sense in the old days, with state lottos and when jackpots were smaller. With a smaller jackpot under $10M, there is some tax advantage with smaller annual payments falling under the top tax bracket. But now with huge jackpots of a few hundred million, that disappears.

I agree that it can seem scary when the jackpot is so large like now. You'd be so busy worrying about moving the money around and diversifying in the early stages, so some might consider the annuty for less stress and to have security.

Why can't they do half and half? Let you claim part of the JP as cash, and part as annuity? I don't know if this can be done, but sheesh, if they can do it for pizza, why not the lottery? Some winners do with by splitting payment options between husband and wife, or siblings, but how about for one person? I'd vote for that.

ressuccess's avatarressuccess

I hope the Mega Millions Jackpot continues to roll.

DC81's avatarDC81

Quote: Originally posted by surimaribo24 on Dec 9, 2013

wow . someone's live will change tom  . night . 

goodluck everyone .

Considering how few combinations were likely used last drawing, I doubt sales are going to explode to the point where at least half of them are used up so, probably not.

Six balls

There's nothing* to prevent you from taking your cash and using a chunk to but an annuity on your own.

 

* Unless you're younger than 40-45; then you'll have a doozy of a time finding someone to sell you an annuity if you're 'too' young. Even a 40 year old would be pretty limited on options.

zirabamuzaale

Quote: Originally posted by DDOH937 on Dec 7, 2013

What is the Deal with These People Not Spending the extra ONE DOLLAR for MEGA PLAY???? Congrats to them but COME ON!!!!! Remember people, the jackpot odds are through the roof, so it makes sense to hedge for the maximum amount second/third/fourth place prize. Get it together people!!! hahahaha

I am playing four combinations with four different golden numbers and no.3  delivered back-to-back wins last week i.e. Tuesday and Friday. The Mega is where to be. Thank God the Mega golden balls were drastically reduced!!!

zirabamuzaale

Quote: Originally posted by Win$500Quick on Dec 7, 2013

I Agree! I am boycotting by spending $1 per draw. With these astronomical odds I rather spend my money on Florida Lottery Games such as Fantasy 5, Mega Money and Lotto which have better odds.

Yes, I too like Fantasy 5 in which I have won several times. I am playing $2 per draw at the Mega. So far I have won at three instances since the new Mega Matrix was introduced. I haven't won in our local Arizona Pick since around June/July of last year and yet we are often told that the odds of winning in the state lottos are far better than in the national/international lottos such as Powerball and Megamillions. That may not be true with every individual that regularly participates in the state lottos.

zirabamuzaale

Quote: Originally posted by BuyLow on Dec 8, 2013

Looks like it will jump to 4th largest jackpot ever if not hit Tuesday.......!!!! 

 

I am ready for a win!  Florida has not ever won a MM Jackpot, I will accept on their behalf!!

I will be willing to accept one for Arizona where I currently hail from one since Arizona has as yet to get a MM jackpot winner!!!

LottoMetro's avatarLottoMetro

Once again sales are going to be short the projections, and the annuity factor decreased.

If jackpot rolls tonight it will be $400 million with $216.4 million cash, depending on last minute sales it could be $401 M with $216.9 M cash.

WWWBUKTN

You can stop buying tickets as I already bought the winner this afternoon out of a lotto vending machine at the grocery store.   Some old lady tried to get in front of me but I blocked her out as were not going to have one of those silly stories this time around.

hsg2000

No Pity!US FlagGOOD LUCK EVERYONE, HOPE TO SEE THE JACKPOT STILL IN FEVER CROSSING $400 MILLION FOR FRIDAY DRAW!!!

dearlord

Sorry to burst your bubble, but I just purchased a ticket.  As such, someone will win tonight and I will hit not a single number.  It is the way of the lottery for me.

DDOH937's avatarDDOH937

Quote: Originally posted by WWWBUKTN on Dec 10, 2013

You can stop buying tickets as I already bought the winner this afternoon out of a lotto vending machine at the grocery store.   Some old lady tried to get in front of me but I blocked her out as were not going to have one of those silly stories this time around.

HAHAHHAHAHAHAHAAAA, not sure why but i found your ""Some old lady tried to get in front of me but I blocked her out as were not going to have one of those silly stories this time around"" comment extremely fuuny. May she wins and the story becomes " some guy wouldnt let me go ahead of him so i patiently waited and look, i won $344 million". Hhahaha, you really can't make this stuff up, too funny!!!!Smash

DDOH937's avatarDDOH937

Quote: Originally posted by LottoMetro on Dec 10, 2013

Once again sales are going to be short the projections, and the annuity factor decreased.

If jackpot rolls tonight it will be $400 million with $216.4 million cash, depending on last minute sales it could be $401 M with $216.9 M cash.

I say they push it to $415 million... GOOD LUCK MEGA MIL PLAYERS!!! Hope many of you get a shot at the second prize...hahhaha

LottoMetro's avatarLottoMetro

Quote: Originally posted by DDOH937 on Dec 10, 2013

I say they push it to $415 million... GOOD LUCK MEGA MIL PLAYERS!!! Hope many of you get a shot at the second prize...hahhaha

Maybe by Friday they will. But tonight, no. Sales are lower than expected and the reduced annuity factor (1.869 to 1.848) doesn't help. They're actually facing a shortage of nearly $3 million. I think now that we'll be at/over $400M, things will start to pick up from here on.

hearsetrax's avatarhearsetrax

Good luck to all playing tonight ......

Winning ticket sold in VA

Win$500Quick's avatarWin$500Quick

Quote: Originally posted by RedStang on Dec 8, 2013

Would'nt call spending a dollar Boycotting Blue Thinking.   You're actually doing what they planned for.

I use to play $5-$10 every draw on Mega Millions every since it came to Florida. $1 is my way of boycotting because you only need 1 ticket to win.

Teddi's avatarTeddi

Quote: Originally posted by Jill34786 on Dec 8, 2013

Another point I would like to make about taking the cash option instead of the annuity is the ability to let it grow without touching the principal

Using this current $344M jackpot which offers a CV of $184M the net payout after 39.6% Federal tax is applied would be a little over $111 million. Just for comparison the $344 annuity would amount to a $207 million take home pay if the current top tier Fed rate didn't change over the next 29 years (which is unlikely).

Investing $100 million using a diverse approach with a qualified team of financial advisers/money manager should easily bring conservative returns of at least 6-8% annually. Under a slightly more aggressive approach, 12-15% is completely possible.

I would suggest the milder goal of 6-8% as over the span of 30-years, you would have far exceeded the return of the lottery annuity without ever making a dent in the principal.

Thanks Jill. I always love to hear your take on things

Todd's avatarTodd

Friday jackpot will be $400 million if nobody hits tonight.

weshar75's avatarweshar75

Quote: Originally posted by Todd on Dec 10, 2013

Friday jackpot will be $400 million if nobody hits tonight.

Yeah I heard that on the drawing.  The lotto anouncer said that.  I just hope it rolls to friday since I have a multi-draw ticket.-weshar75

US Flag

meriwetherman's avatarmeriwetherman

Did you hit?

65 22 41 5 12 magic ball 13

sully16's avatarsully16

Quote: Originally posted by Todd on Dec 10, 2013

Friday jackpot will be $400 million if nobody hits tonight.

I really think this one can grow into a monster jackpot.

DisplacedLurker

Quote: Originally posted by Jill34786 on Dec 8, 2013

Another point I would like to make about taking the cash option instead of the annuity is the ability to let it grow without touching the principal

Using this current $344M jackpot which offers a CV of $184M the net payout after 39.6% Federal tax is applied would be a little over $111 million. Just for comparison the $344 annuity would amount to a $207 million take home pay if the current top tier Fed rate didn't change over the next 29 years (which is unlikely).

Investing $100 million using a diverse approach with a qualified team of financial advisers/money manager should easily bring conservative returns of at least 6-8% annually. Under a slightly more aggressive approach, 12-15% is completely possible.

I would suggest the milder goal of 6-8% as over the span of 30-years, you would have far exceeded the return of the lottery annuity without ever making a dent in the principal.

Jill, I always love your educated analysis on this. Thank you so much for giving us your input. 

While not quite in the same topic, wouldn't a huge deterrent for accepting the annuity option come from the fact that estate taxes are due on the entire amount (as in the advertised annuity) after someone dies prior to their annuity completing? So, sure, the money would be guaranteed regardless of which option, but the taxes would be overwhelming. Correct me if I'm wrong. Even though I don't have kids, I wouldn't want to leave anyone that burden should I die before my returns come from my annuity. 

Besides, cash is king. The cash value may be low right now, but that's due to higher interest rates and yields plus MM switching to the 30 year graduated annuity option ala Powerball when prior it was the set annuity over 26 years.

fwlawrence's avatarfwlawrence

Quote: Originally posted by Todd on Dec 10, 2013

Friday jackpot will be $400 million if nobody hits tonight.

It is now $400 million!

noahproblem

Quote: Originally posted by fwlawrence on Dec 11, 2013

It is now $400 million!

That seems rather conservative going from $344 million.  I guess the longer odds are still keeping the big money players (i.e. those like me who only play for the big jackpots) on the sidelines? (I might take a small plunge this time.)

helpmewin's avatarhelpmewin

Quote: Originally posted by Todd on Dec 10, 2013

Friday jackpot will be $400 million if nobody hits tonight.

Thanks for the update i hope it doesn't become a Winner then the ole "Unclaimed ticket" TRICKP***ed

helpmewin's avatarhelpmewin

Another thing if anyone hasn't realized the next Mega Drawing is on FRIDAY the 13thEek

rdgrnr's avatarrdgrnr

Quote: Originally posted by noahproblem on Dec 11, 2013

That seems rather conservative going from $344 million.  I guess the longer odds are still keeping the big money players (i.e. those like me who only play for the big jackpots) on the sidelines? (I might take a small plunge this time.)

You don't consider $344 million a big jackpot?

Not worth a buck to ya?

DDOH937's avatarDDOH937

Quote: Originally posted by rdgrnr on Dec 11, 2013

You don't consider $344 million a big jackpot?

Not worth a buck to ya?

I dont understand it either, are these people really scoffing at a $400 Million pot????? Have we really all just become so jaded??? I'd take a jump at $400K in a heartbeat much less $400 Million. I guess its all jsut talk anyway, but come on.

noahproblem

Quote: Originally posted by rdgrnr on Dec 11, 2013

You don't consider $344 million a big jackpot?

Not worth a buck to ya?

For the terrible odds of winning involved (even by jackpot draw standards), no it wasn't.  I did take a small plunge today  for Friday, though.

rdgrnr's avatarrdgrnr

Quote: Originally posted by noahproblem on Dec 11, 2013

For the terrible odds of winning involved (even by jackpot draw standards), no it wasn't.  I did take a small plunge today  for Friday, though.

Oh man.

Remind me never to go drinkin' with you, lol.

Good luck though!

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