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Tonight’s PB, fun facts...

Topic closed. 6 replies. Last post 13 years ago by plnwebguy.

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hypersoniq's avatar - 8ball
Pennsylvania
United States
Member #1340
April 6, 2003
2450 Posts
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Posted: March 13, 2004, 6:27 pm - IP Logged

The posted annuity value is $90,000,000, this is a payout of $2,190,000 per year... of that amount, they only withhold 27%, leaving you responsible for paying the additional 8% ($240,000) for a realistic total of  $1,950,000. Not bad... total payout will be $58,500,000

The posted Cash value is $50,200,000, this is a one-time payout of $36,646,000... you will need to also pay the remaining 8% not withheld by MUSL ($4,016,000) leaving you with a one-time payment of $32,630,000 after all taxes are paid...

The difference is of course 29 years and $25,870,000 ($1,034,800 per year)

Assuming a 9% rate of return, you can start your own annuity with $500,000 and 29 annual contributions of $200,000 and end up with $33,147,600

.....all for a total cost of $6,300,000 out of the original #$32,630,000, leaving $26,330,000 to last you 29 years until the annuity kicks in... and you get another 33 mill to play with... and the $6,300,000 contribution is split over 29 years...

bottom line....

MUSL's annuity option... $58,500,000 after 29 years

Your own personalized plan by taking CASH... $59,477,600 after 29 years

Now, there are MANY variables here, return rates, etc... BUT the main difference is the fact that you have the major lump sum of 32 million all at once immediately, you could watch any children enjoy the money NOW instead of after you are gone, and the extra 33 mill from the annuity makes one heck of a farewell gift anyway... ;-)

By taking the cash, you have the freedom to do something crazy like buy a $5,000,000 luxury estate, and still have the flexibility to create your own annuity to "make up the difference" and then some vs. taking the MUSL's annuity... If you're gonna be rich, why not be REALLY rich?

Another plan for a portion of the money is to cut yourself a "salary", for example, putting $6,145,414.00 into an account and transferring a payment of 211,000 per year into your own personal account, will let you sustain this way for 30 years WITH a cost of living increase of 3% per year AND not taking into account any interest gained on the main account...

When I first came to this site, I was sort of torn on the cash vs. annuity scenario, but now I know I would take the cash... without hesitation...

Playing more than one ticket per game is betting against yourself.

    Avatar
    New Jersey
    United States
    Member #3457
    January 22, 2004
    248 Posts
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    Posted: March 13, 2004, 6:58 pm - IP Logged

    ...especially when you consider that nations with intemperate balance of payments deficits coupled with unprecedented government deficits generally experience hyperinflation dventually.

    Be sure to buy some Euros, yen, yuan and rupees.

      twisted's avatar - underground
      New Jersey
      United States
      Member #2376
      September 25, 2003
      582 Posts
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      Posted: March 13, 2004, 9:08 pm - IP Logged

      prob987, do you mean Indian rupees?

        Thomas Covenant's avatar - money
        South Carolina
        United States
        Member #491
        July 16, 2002
        837 Posts
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        Posted: March 13, 2004, 9:46 pm - IP Logged

        A guaranteed rate of return of 9% for 29 years? Now where are you going to get that? Average is about 4% to 5%. Everyone thinks they could do better investing than what the lottery annuity pays, but that's usually not the case. The lottery annuity is pre-tax investment, it's hard to beat that.


        Okay, now I believe you can predict lottery numbers

          Fwup's avatar - babylaugh 086.gif

          United States
          Member #3654
          February 9, 2004
          70 Posts
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          Posted: March 13, 2004, 11:17 pm - IP Logged

          So if you take the lump sum AND manage to get a 9% return for 29 years, you'll end up with an extra $33,710.34 a year?



          On the other hand, if you take the annuity, you get a yearly check for almost $2 mil without having to worry about maintaining a 9% return, plus you can't go crazy and blow the entire wad in a few years. You KNOW you'll get a $2 mil check every year.



          For me, the peace of mind I'd have knowing I'm getting a steady paycheck is worth $33k a year.

            hypersoniq's avatar - 8ball
            Pennsylvania
            United States
            Member #1340
            April 6, 2003
            2450 Posts
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            Posted: March 14, 2004, 5:39 am - IP Logged

            looks like it won't be our problem... 1 winner in indiana...

            Playing more than one ticket per game is betting against yourself.

              plnwebguy's avatar - binary

              United States
              Member #3680
              February 11, 2004
              187 Posts
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              Posted: March 14, 2004, 9:02 am - IP Logged

              Here's another fun fact:

              Until the drawing, 50 was the only white ball that had not been picked in any of the previous 66 jackpot drawings of the current version of Powerball.  As of now, they've all been chosen at least once, with 2 leading the pack being chosen 12 times.

              plnwebguy