OT: Powerball rolled, up to 1.3 Billion
January 10th, 2016 at 2:06 AM ^
insane!
January 10th, 2016 at 2:08 AM ^
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January 10th, 2016 at 2:10 AM ^
I might get a ticket just for novelty sake. I kind of want to win but then read about all these people who end up homeless with a split up family and other problems.
January 10th, 2016 at 2:12 AM ^
Don't worry, you can still read about them even if you don't win.
That's kind of messed up though.
January 10th, 2016 at 8:05 AM ^
January 10th, 2016 at 6:26 PM ^
Those peoples' lives were fucked up before they won
January 10th, 2016 at 2:17 AM ^
January 10th, 2016 at 6:33 AM ^
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January 10th, 2016 at 1:09 PM ^
Exactly.
It changes the way people relate to you, changes your goals, makes you question the meaning/purpose of your life, and very foundation of the way you live. An overwhelming people on this planet could not handle that sudden introspection, so quickly and without their own choosing.
You basically become alienated in every single facet/experience of soceity and the world around you.
And this isn't even considering people asking you for money.
It's the epitome of the term "Golden Handcuffs".
All those world famous people (Obama just said it himself) reveal that if they could buy/have one thing, it would be to go back to being anonymous, go to the store and buy milk, and not be bombarded, eat at a restaurant and have an honest conversation with your waiter/waitress.
The human organism wants homestasis. Too much of anything (anything!) will kill you.
January 10th, 2016 at 8:31 AM ^
Can take the annuity option, which automatically manages/invests at least some of the money for you (and you get a 5% yearly increase to account for inflation).
January 10th, 2016 at 8:47 AM ^
January 10th, 2016 at 8:53 AM ^
January 10th, 2016 at 10:02 AM ^
Not true. The annuity is an asset like anything else and can be transferred to your estate.
What surprised me when I read it, was an article that said in the past seven years only one jackpot winner has taken the annuity. For smaller jackpots especially, the cash option is incredibly moronic from a tax standpoint.
Give me the jackpot and I'm taking the annuity every single damn time. This big a jackpot, the first cash payment would be in the neighborhood of $20 million. Fine by me.
January 10th, 2016 at 10:20 AM ^
Why is it moronic to take the cash option? Why would you assume that someone has no other source of income that would impact tax brackets? On top of that, while inflation is currently low, you have no idea where inflation will be in several years to say nothing about federal income tax rates.
January 10th, 2016 at 10:29 AM ^
Because the government taxes you on the money you make that year. If you take all of it in one year, it's almost entirely taxed at the highest income bracket. Take the cash, close to 100% of it is taxed at the highest rate. Take the annuity, and for a $100 million jackpot (which is about what people usually win) only about 85% of it is taxed at the highest rate.
Sure, you can beat the taxman by taking the cash and then investing it such that the income isn't taxed at the highest rate.....but then, you're not beating the income you'd have gotten with the annuity, either.
January 10th, 2016 at 10:52 AM ^
For 2016, at 415K for a single filer, you are maxed out with Federal taxes. If your talking about 100 million using today's rates as a benchmark, there is no way you aren't at the top of the tax scale every year. http://www.irs.com/articles/projected-us-tax-rates-2016
Then there is the little issue of the future value of dollar.
January 10th, 2016 at 11:20 AM ^
Yes, you're at the top of the tax scale. But not every dollar is taxed at the same rate. If you earn $1 million as a single filer, $415K of that is taxed at something less than the top rate. Only $585K is taxed at 39.6%.
Hence, if you break up the payments, you're moving more money into lower tax brackets.
January 10th, 2016 at 11:29 AM ^
January 10th, 2016 at 11:50 AM ^
Do you want to take the risk that tax rates aren't massively higher 30 years in the future than they are right now? That would have been a good bet in 1986, but who knows what the future will bring?
January 10th, 2016 at 12:08 PM ^
Could be lower. Could be massively increased capital gains taxes. Either one of which would point you toward an annuity. Trying to guess tax policy 20 years from now is a fool's errand.
January 10th, 2016 at 12:16 PM ^
And that's my point. Arguing that the annuity is better for tax reasons is more or less true right now, but who knows if the 1950's top tax bracket of 91 percent will ever return.
Another reason for the lump sum is the possibility of very high inflation, even a brief period of it, over the next 30 years. If we get a period of 1970's style inflation, or a little worse than that, wouldn't you rather have your money in your hands as it's happening, so you have the possibility of letting your wealth keep up with the inflation rate?
January 10th, 2016 at 8:38 PM ^
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January 10th, 2016 at 6:33 PM ^
You're getting fucked on taxes no matter what, better to take the lump sum and reinvest it. The work that money starts doing for you immediately will greatly outweigh any tax considerations or the higher total payout plus you can make your big purchases right away like the inevitable new house and car.
As bluebyyou says the only reason to take the monthly payment is if you are horrid at saving yet somehow have the self-awareness to know this and the willpower to ignore your spending problem at the start. Seems unlikely.
January 10th, 2016 at 8:30 PM ^
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January 10th, 2016 at 9:10 AM ^
January 10th, 2016 at 9:32 AM ^
Agreed, that's A LOT of hookers and blow. Charlie Sheen would applaud you.
January 10th, 2016 at 9:48 AM ^
In case you can get by the stigma of what happens to some of the winners, should you win, find yourself a good national law firm and get set up in a state with no income tax.
I just saved you at least 50 million.
January 10th, 2016 at 9:59 AM ^
January 10th, 2016 at 10:13 AM ^
He will still pay his taxes....just not a state income tax. That's why pro athletes like living in states with no income tax like Florida.
January 10th, 2016 at 10:21 AM ^
January 10th, 2016 at 10:22 AM ^
You can still live where you want and have multiple residences, but given the opportunity, my residence will always be in a state with a very low income tax rate or no income taxes.
January 10th, 2016 at 10:33 AM ^
January 10th, 2016 at 10:54 AM ^
If you have investing sense, and I'm not trying to be a wise ass, you always take advantage of the opportunity to minimize your tax burden. For instance, most of my post-college life has been in Maryland, where I typically pay between 6-9 percent in state and local taxes. The effect of the money I paid to MD versus the opportunity to take the same money and invest it over several decades is huge.
And as to an investing benchmark, if you are risk averse and want safety, your rate of return is much lower than many people think.
January 10th, 2016 at 10:58 AM ^
How else can I sit courtside with my new super model wife?
January 10th, 2016 at 2:11 AM ^
Or you could just name the whole stadium after you.
January 10th, 2016 at 11:01 AM ^
and the the stadium gets burned down. Did you hear people when they talked about a pregame video screen ad?
January 10th, 2016 at 2:12 AM ^
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January 10th, 2016 at 2:27 AM ^
MGoBlog would be the first place where I would let the world know that I won the lotto.
January 10th, 2016 at 10:41 AM ^
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January 10th, 2016 at 2:29 AM ^
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January 10th, 2016 at 2:30 AM ^
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January 10th, 2016 at 5:02 AM ^
I'd buy a BAD studio in the East Village. With the rest, I would get a nice milkshake or something.
January 10th, 2016 at 10:28 AM ^
January 10th, 2016 at 12:27 PM ^
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January 11th, 2016 at 1:19 AM ^
to walk for miles to get to their games.
Of course, I'd show some hospitality by providing coolers along the way for those needing to relieve themselves.
Not sure what I'd do with the remaining $1.299 billion.
January 10th, 2016 at 2:33 AM ^
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January 10th, 2016 at 4:47 AM ^
January 10th, 2016 at 6:47 AM ^
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January 10th, 2016 at 2:42 AM ^
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January 10th, 2016 at 2:49 AM ^
aaaaaand the rest is taxes