You won the lottery! Annuity or Lump sum?

[BatteredRose]

Lump sum.

I spent half of my lottery winnings on making a post with more than 10 characters.

[Dr Morako]

Lump sum. Reason: I would share my lottery winnings to help out a lot of my family members in need of a little extra cash and other things. I would help my recently engaged brother and his wife buy a house, my two older brothers with their bills and put away money for their kids so they can get a college education. CD's for said kids. My sister and her baby. Help my fourth brother get back on his feet and get an education. Complete my Father's and Mother's last wills (Where they want their ashes to lay). Invest some cash, bank a good portion, and support myself in getting my doct in mental therapy and Psychology so that I can help those in need.

Lump sum appeals to me more than annuity because I can help those I care about to a full extent, while supporting myself.

[Correlia]

Annuity by far, I rather have a steady income then to get all the money at once and blow it all on random crap I don't need or will ever use (I have a tendancy to do that >_>)

[Kemical]

Annuity with taxes on both you get more this way.

[Lilcheeks]

I'd lump that sum.

[drwelfare]

Lump sum so I can sit around in my drawers eating cold cuts all day.

[Arcadem]

Lump sum, Pay a Financial adviser to help me invest part of my money. Put 1/5 of the money on my account and 4/5 on a savings account (Of the money that's left after investing).

What ever you do, If you ever win the lottery (A big number) pay a financial adviser to help you, it will be the best decision in you life (except for buying a lottery ticket) and it will be really helpfull.

[Twotonsteak]

You just won the lottery! Would you take the annuity or a lump sum payment?

And if you took the lump sum payment, what the hell do you do with it? Just throw it in a bank like normal?

I would choose the lump sum option. As the Powerball is currently 20 million, I would guess the lump sum to be around ten million after taxes and fee's. Of that ten million I would (in no particular order)...

1. Buy a home and land. I would stay in my current area and I would NOT buy a large house. Something reasonable with two bedrooms. The land, though, would be large and wooded. I like my privacy and peace.
2. Buy a car. Not a fancy sports car...the damn thing would be horrible during the winters. Something nice, useful, with four-wheel drive.
(I should be able to get both for well under a million.)
3. There is a local no-kill cat shelter near me. They're overcrowded and, relying entirely on donations, usually underfunded. I'd make a sizable donation of cash, food, and equipment.
4. I'd fund a humane catch and release program in my area. These sorts of programs catch stray and feral cats, spay/neuter them, then release them where they were found to live out their lives without further overpopulating the area.
5. I'd semi-retire. I'm too young to fully retire and still afford all my bills for the rest of my life. That and I'd be bored out of my mind. So I'd work part time, maybe 20 hours a week.
6. Move my mother out of her appartment and into a suitable home...that she owns.
7. Can't do much for my father. The man owns his house already, and his truck, and his own business. Even if he had the money to stop working, he wouldn't.
8. Tour Europe. I want to see real history. I want to see cities that are twice as old as the USA is. I want to see the ancient wonders.
9. Volunteer at that no-kill shelter...a LOT.
10. Have my father handle the rest. Anyone that can start and run two successful companies should know a thing or two about handling money. And I trust him more than any bank or Madoff.

[Fuzzzie]

Lump sum. Have some fun with it, die young!

[Shinagami091]

Lump sum. For the sake of my benefactors. If you were to go with an annuity, the person getting your money after you die will be taxed twice which can result in the benefactor paying more than what the annuity is. Which means, the benefactor will have to pay out of pocket to keep out of trouble with the IRS. See this story for an explaination:

Here is an example of what may happen without proper planning, both when purchasing the ticket and upon discovering it is a winner. In May 1995, Johnny Ray Brewster won $12.8 million in the Texas lottery. Johnny died of a heart attack ten months later after receiving only one annual payment of $463,320. Johnny’s sister, Penny, was the sole beneficiary of his estate which included as its primary asset the right to the remaining lottery payments. The estimated federal estate tax totaled approximately $3.5 million. Because the estate did not yet have these funds, the IRS agreed to a ten year payment plan with annual payments of approximately $482,000, that is, $18,680 more than the annual lottery payments. Under this arrangement, Penny would need to put $18,680 of her own money toward the taxes for ten years. Only in the eleventh year, would Penny finally be able to benefit from her brother’s lucky ticket. See Lotto Texas Heirs Cry For Help With Federal Tax Bills, San Antonio Express-News, July 12, 1996, at 6B. (Luckily for Penny, the Lottery Commission allowed the estate to cash in the remainder of the prize at its present value. Commission Moves to Aid Estate Handle Large Inheritance Tax Bill, San Antonio Express-News, Aug. 29, 1996, at 20A. Note that the 1999 Texas Legislature authorized court-approved assignments of the right to receive prize payments. If this situation were to arise today, perhaps Penny could sell her right to future payments, raise enough money to pay off the taxes, and have funds left over for herself.)

[NeftBat]

Lump sum. For the sake of my benefactors. If you were to go with an annuity, the person getting your money after you die will be taxed twice which can result in the benefactor paying more than what the annuity is. Which means, the benefactor will have to pay out of pocket to keep out of trouble with the IRS. See this story for an explaination:

Here is an example of what may happen without proper planning, both when purchasing the ticket and upon discovering it is a winner. In May 1995, Johnny Ray Brewster won $12.8 million in the Texas lottery. Johnny died of a heart attack ten months later after receiving only one annual payment of $463,320. Johnny’s sister, Penny, was the sole beneficiary of his estate which included as its primary asset the right to the remaining lottery payments. The estimated federal estate tax totaled approximately $3.5 million. Because the estate did not yet have these funds, the IRS agreed to a ten year payment plan with annual payments of approximately $482,000, that is, $18,680 more than the annual lottery payments. Under this arrangement, Penny would need to put $18,680 of her own money toward the taxes for ten years. Only in the eleventh year, would Penny finally be able to benefit from her brother’s lucky ticket. See Lotto Texas Heirs Cry For Help With Federal Tax Bills, San Antonio Express-News, July 12, 1996, at 6B. (Luckily for Penny, the Lottery Commission allowed the estate to cash in the remainder of the prize at its present value. Commission Moves to Aid Estate Handle Large Inheritance Tax Bill, San Antonio Express-News, Aug. 29, 1996, at 20A. Note that the 1999 Texas Legislature authorized court-approved assignments of the right to receive prize payments. If this situation were to arise today, perhaps Penny could sell her right to future payments, raise enough money to pay off the taxes, and have funds left over for herself.)

To be fair, if you ever found yourself in a position where inheriting the annuity would cost you money you could always just not take it.

[Zavri]

dumb as hell.

lump sum with proper investment strategy would net you at least DOUBLE the amount of an annuitiy.

If the state would go bankrupt it's even more in your favor to do the lump sum.

[callipygoustp]

Lump sum.
{10 char}

[bmjclark]

Did you just bump your own 7 year old thread? lol

[yetgdhfgh]

Lump some for me

I dont give a fuck if the government taxes a huge chunk of it cause i would much rather have all the money now then maybe die 3 years later and only seeing about a fraction of it which my family would inherit.

[Theodarzna]

You just won the lottery! Would you take the annuity or a lump sum payment?

And if you took the lump sum payment, what the hell do you do with it? Just throw it in a bank like normal?

Lump sum, hire the best lawyer (A partner), a tax attorney (partner) and an accountant. Than invest it as wisely as possible.

[Crissi]

Major necro

Closing