What would you have done? Yesterday's Powerball winner of 780 million was about 12 years from retiring, and took a lump sum of 380 million, probably wouldn't live long enough to reap the benefits of long term payout, but I know I certainly would have delayed gratification.
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You have to run the numbers for a net present value comparison and see whether the lump sum or the series of payments makes more sense.
Assuming an identical net present value, it's better to have cash in hand rather than a promise of future payments. You're going to be in the top income rate for the rest of your life either way with this kind of money.
Need the use of a great (not merely good) trust and estate attorney. This is one of those rare cases where some amount of whole life or an annuity might make sense.
With $380M, you have a big target on your back for kidnapping, gratuitous lawsuits, in-laws and outlaws coming out of the woodwork, etc. Mo money, mo problems.
An alarmingly high number of lotto winners and professional athletes end up broke and/or dead within 5-10 years of coming into money. Enjoy your newfound fortune, but try to avoid becoming a statistic.
Might as well set up a donor advised fund or charitable trust for the causes you care about. Heck, your heirs and their heirs might take a tidy salary for the "work" of advising and running your foundation or charitable trust.
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First thing I would have done was NOT show my face or give my name out. And if required I would have worn an outfit resembling something like a full body suit Chewbacca outfit to the press conference and spoken in one-word answers using a Christian Bale Batman voice. And yes - lump sum.
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It sounds like the lump sum makes the most sense in her case. But I agree, I don't know why she didn't remain anonymous. My husband happened to be in ID over the weekend and since we don't have the lotto here in UT, I told him to buy a ticket for fun. So we were discussing what we'd do if we won. Both agreed we'd remain anonymous. But I guess we don't have to worry about that . . .
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What would you have done? Yesterday’s Powerball winner of 780 million was about 12 years from retiring, and took a lump sum of 380 million, probably wouldn’t live long enough to reap the benefits of long term payout, but I know I certainly would have delayed gratification.
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Absolutely would take the lump sum. Who needs 780 million? 380 is plenty (although I read it was 443?). After the 25% or so taxes you're still left with over 260 mil. A 4% withdraw rate on that would give you 10.5 million dollars a year for the rest of your life to spend on whatever you want. Plus you'd still have the original principle or more left when you die to pass on to your loved ones or to charity. I think I could get used to that kind of lifestyle
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Was it possible to accept the prize anonymously, through a trust, etc?
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Only certain lottery holding states allow the winner to stay anonymous. And only a few allow a trust owners to also remain anonymous and not disclosable, in case you want to collect the money through a trust
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