This is who I like winning the lotto

[Think]

http://www.comcast.net/articles/news-general/20090605/US.Rags.to.Riches/

[McVaaahhh]

The only person I'd like to win it more than someone like that is me. :D

In all seriousness, that's a great story! :up:

[puckstr]

The only person I'd like to win it more than someone like that is me. :D

:up:

I feel the same....but for ME:)

[milehicitygirl]

You're right. . . great story. Nice to hear a happy ending these days, ya know?

[Pandora-11]

Wait a minute. 232 million minus taxes is only 88 million? What kind of tax rate is that?...or is that what happens when you take the lump sum? I don't play so I don't know. This is almost two-thirds of it in taxes.

[milehicitygirl]

Wait a minute. 232 million minus taxes is only 88 million? What kind of tax rate is that?...or is that what happens when you take the lump sum? I don't play so I don't know. This is almost two-thirds of it in taxes.


Oh yeah, if you take the lump sum pay out. . . they rape you on taxes. . . . friggen government !:alien:

[longrider]

If you take the lump sum you only get about half the advertised amount, then taxes is 25% of that.

[Pandora-11]

Geeeez...I'd rather give it to this kid. He'd make better use of it!

[konichd]

Nice to see, I drive through Mission on my way home to visit my parents in Mitchell. Its pretty damn diss-heartening, hopefully he rewards the community and good things happen.

With that money, he makes @4.5 million a year in interest alone so he's pretty much set as there's not even $100 worth of stuff to buy in Mission.

[Sleev]

$232 ? DAAAAAAAAAMN!!

[BlueDog]

Anyone else notice he is neighbors with the Assman?

[thatmofo]

I agree with you.

I did see the Assman reference too and I LOLd.

[~Barn~]

Longrider's got it right, taxes don't really have anything to do with it. Income taxes rates are income taxes rates. It's just that fact that he took the lump-sum payment, so it's a reduced amount. That and of course, all this "income" happened all at once, so that taxes are applied thusly.

Being as young as he is, I think it was a mistake to pick that, over the annuity, but either way it's a lot of money. Seems like a nice-enough person to have this happen for. :up:

[The Black Knight]

And see, I would have taken it as a lump sum regardless of how much you lose initially and then whatever taxes you do have to pay. I remember reading something on lottery winners, that if you take the lump sum, you only have to pay taxes on it twice. Obviously when you win, and then on the next years income tax filing(say 2010, because you'd file for 2009 taxes). So you're only in a different tax bracket for one year(because of the big difference in your income).

Well with annuity distribution you end up being in a higher tax bracket forever. Because you chose to have it paid to you every year, you end up paying more in taxes as the IRS sees that you've changed tax brackets all together. So you never go back to your old tax bracket(where you were before you won).

So for me, I'd take the "lump sum" get jammed for all the taxes right up front for the first year. Then go back to where I was before and only having to pay taxes on it once and then it's out of my hair. You could invest it and get a rate of return that would get you back most of what you've paid in taxes(over the course of your life) and spend it other ways(go into business for yourself, buy other businesses, etc.)

Either way, I'd go the route of giving Uncle Sam the least amount of money I could when it comes to a big lotto win.

[t_jolt]

Besides If he does it smart, the lump sum can be worth way more then the aunnity anyway.

Tyrel

[~Barn~]

Easier said than done though. I mean first of all, you have to basically double what you've just won, in order to just draw even with what the annuity pays out.

If you're looking for a big return to actually achieve something like that, you obviously have to go the route of high-return investments. High-return stuff (of course), is also high-risk, so you run the potential of actually going into the red, instead of earning.

And if you think you're going to do it the safe and secure way, you're probably looking at things like T-bills/T-bonds. And even the highest yielding ones are of the 30 year variety, and you're only looking at a 5% return give-or-take. And of course that means all your money is now out-of-reach, while it's "invested".

It's something that people often think is doable, but it's virtually next to impossible to hit investments that are going to earn enough to match the annuity payout, much-less out-perform it, without putting your money at EXTREME risk.
:dunno:

[brennahm]

Hmmm, I've NEVER read anywhere that it's better to take the annuity. Oh well, I guess I'll let other people worry about it since I haven't won yet.

Also, I'd take the anonymous claim method. It's nobody's business if I win millions of dollars.

[~Barn~]

Well the cash vs. annuity philosophy is certainly a case-by-case basis. The winner's age, their health, the size of the jackpot, their current financial standing pre-jackpot, all kinds of things (and more), figure into the equation. I think in this guys case, being as young as he is, the annuity would have been what I would have picked. YMMV.

Personally, I'm waiting for somebody to give me their winning ticket. I actually have a better mathematical chance of that happening, than buying my own. :lol: