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Unlucky fool

Columbus,Ohio
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January 30, 2019
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Jan 30, 2019, 5:26 pm

Just discussing with my wife about the improbable likelihood of hitting a big mega millions jackpot. Whether we would take lump or annuity. I think it would be best to take my half in lump allowing her to to take her half in annuity payments. I'm pretty sure I saw a couple on a lotto show say they done this but I can't remember exactly. Does anybody know if that is allowed generally?
noise-gate

* In hot pursuit of $ *

White Shores- California
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Jan 30, 2019, 6:21 pm

You could always ask that question directly to your State Lottery.

*The obvious questions, asked of you both could be: Why the seperation of wealth, are you planning on divorcing each other anytime soon? Are either of you close to death?

* Voice of Reason *

* People who say it cannot be done should not interrupt those who are doing it- George Bernard Shaw.
Artist77

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Jan 30, 2019, 6:33 pm

Quote: Originally posted by Unlucky fool on Jan 30, 2019
Just discussing with my wife about the improbable likelihood of hitting a big mega millions jackpot. Whether we would take lump or annuity. I think it would be best to take my half in lump allowing her to to take her half in annuity payments. I'm pretty sure I saw a couple on a lotto show say they done this but I can't remember exactly. Does anybody know if that is allowed generally?

I doubt it. It would complicate things too much. Imagine if a large group wanted the same option.
hearsetrax

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Jan 30, 2019, 6:49 pm

Quote: Originally posted by noise-gate on Jan 30, 2019
You could always ask that question directly to your State Lottery.

*The obvious questions, asked of you both could be: Why the seperation of wealth, are you planning on divorcing each other anytime soon? Are either of you close to death?

+1
weshar75

Mcminnville, Oregon
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Jan 30, 2019, 7:43 pm

Quote: Originally posted by Unlucky fool on Jan 30, 2019
Just discussing with my wife about the improbable likelihood of hitting a big mega millions jackpot. Whether we would take lump or annuity. I think it would be best to take my half in lump allowing her to to take her half in annuity payments. I'm pretty sure I saw a couple on a lotto show say they done this but I can't remember exactly. Does anybody know if that is allowed generally?

An oregon lottery winner took his $9.0 million half in a lump sum and his wife took the annuity payments with her half so I know it can be done.-weshar75
Artist77

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Jan 30, 2019, 7:49 pm

Quote: Originally posted by weshar75 on Jan 30, 2019
An oregon lottery winner took his $9.0 million half in a lump sum and his wife took the annuity payments with her half so I know it can be done.-weshar75

Not for a mm or pb game.
TheMeatman2005

Brooklyn, NY
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Jan 30, 2019, 8:02 pm

Quote: Originally posted by Unlucky fool on Jan 30, 2019
Just discussing with my wife about the improbable likelihood of hitting a big mega millions jackpot. Whether we would take lump or annuity. I think it would be best to take my half in lump allowing her to to take her half in annuity payments. I'm pretty sure I saw a couple on a lotto show say they done this but I can't remember exactly. Does anybody know if that is allowed generally?

I don't know if it's allowed, but wouldn't it be the same as if two friends or a group of players won and decided to receive their payments as lump sum or annuity?

The Meatman 🥩🍗🍔🍖🍤🌭

“The quickest way to double your money is to fold it in half and put it in your back pocket.” Will Rogers

Winning happens in a flash, Like A Bolt Of Lightning!
TheMeatman2005

Brooklyn, NY
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Jan 30, 2019, 8:05 pm

Quote: Originally posted by noise-gate on Jan 30, 2019
You could always ask that question directly to your State Lottery.

*The obvious questions, asked of you both could be: Why the seperation of wealth, are you planning on divorcing each other anytime soon? Are either of you close to death?

Husband: What would you do if i won the lottery?
Wife: I'd take half and leave you.
Husband: Well, I won $12 in the lottery. Here's $6 and you can start packing anytime now.

The Meatman 🥩🍗🍔🍖🍤🌭

“The quickest way to double your money is to fold it in half and put it in your back pocket.” Will Rogers

Winning happens in a flash, Like A Bolt Of Lightning!
Tucker Black

Reno, NV
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Jan 31, 2019, 11:09 am

Take the lump sum and buy an annuity with half of it.
DELotteryPlyr

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January 2, 2015
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Jan 31, 2019, 4:12 pm

Quote: Originally posted by Tucker Black on Jan 31, 2019
Take the lump sum and buy an annuity with half of it.

Interesting.... wonder what kind of annuity you could get ? Would it be better or worse than what the lottery offers. I am thinking places you hear advertising, like JG Wentworth would suck in comparison.
Unlucky fool

Columbus,Ohio
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Jan 31, 2019, 4:43 pm

Thank you for all your replies. The wife and I have been married 23 years and we have no plans on splitting lotto or no lotto. I personally believe keeping our money separate is important and key to getting along. If I ever do win, however unlikely, I would first put a team together before collecting.
Tucker Black

Reno, NV
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Feb 2, 2019, 5:12 am

Quote: Originally posted by DELotteryPlyr on Jan 31, 2019
Interesting.... wonder what kind of annuity you could get ? Would it be better or worse than what the lottery offers. I am thinking places you hear advertising, like JG Wentworth would suck in comparison.

Those bottom feeders buy your annuity and give you a lump sum (at rip-off rates). Go the other direction.... hand a pile of money to an insurance company and then they pay you an annuity. You can choose a fixed term or a life annuity. You'll get better rates (higher monthly payments) than from the state because the state uses the most conservative investments possible.
Sarge0202

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Feb 2, 2019, 9:07 am

Quote: Originally posted by Tucker Black on Jan 31, 2019
Take the lump sum and buy an annuity with half of it.

Take the lump sum and you get nailed with the max taxes, then you have less money to buy the annuity. Then you pay taxes again on the when you cash it in.
Stack47

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Feb 2, 2019, 2:37 pm

Quote: Originally posted by Sarge0202 on Feb 2, 2019
Take the lump sum and you get nailed with the max taxes, then you have less money to buy the annuity. Then you pay taxes again on the when you cash it in.

You don't pay taxes on the original investment, but pay on any capital gains (profits). A lottery annuity is different because taxes were never paid on the winnings so taxes are paid on the total amount of each installment. Pensions, IRAs, 401Ks, etc. are forms of annuities where taxes are deferred.

IMO, the only real advantage of annuities is they are low risk, but usually with low risk comes low returns.
Sarge0202

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Feb 2, 2019, 7:59 pm

Quote: Originally posted by Stack47 on Feb 2, 2019
You don't pay taxes on the original investment, but pay on any capital gains (profits). A lottery annuity is different because taxes were never paid on the winnings so taxes are paid on the total amount of each installment. Pensions, IRAs, 401Ks, etc. are forms of annuities where taxes are deferred.

IMO, the only real advantage of annuities is they are low risk, but usually with low risk comes low returns.

I was responding to Tucker's suggestion that you take lump sum (and pay max taxes on EVERYTHING), then (with a lesser amount) you buy an annuity. So he is going to buy his on annuity with 40% less starting money (of half the winnings). On top of that, the lump sum BEFORE TAXES is about 55-60% of the list prize amount. Very hard to get annuity that gets a "better rate" then 40%+ to make up the 40%+ loss you started with.

Most places allow you to split the winning on the ticket BEFORE you cash it in. This is so one winner (cashing for office pool or family) does not get nailed with income tax, THEN a gift tax when you split it with a group. You can split by dollar amount or % and then each has a lump sum or annuity option.

If the annuity amount payment is low enough that your effective (not marginal) tax rate is below the max rate, the annuity option is good way for regular payments and less tax burden overall. If your yearly annuity payments are a couple million a year, your effective tax rate is about the same as the marginal tax rate, so there is no tax advantage for the annuity.

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