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Old 03-01-2012, 04:10 PM
 
Location: Nebraska
4,222 posts, read 6,935,943 times
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Quote:
Originally Posted by cpg35223 View Post
One issue that has arisen on this thread. While the FDIC insures your deposits up to $250,000 gratis, it is quite possible to buy additional insurance on your account in case the bank fails.
I believe that $250,000 figure is per account per bank.

GL2
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Old 03-01-2012, 04:24 PM
 
Location: Big Sky
553 posts, read 390,085 times
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Quote:
Originally Posted by Yiuppy View Post
LUMP SUM is always best. Tomorrow isn't guaranteed so take it all at once, deal with all the taxes, etc. at once, and then be free to use the money and divide it up the way one sees fit. Remember, with the annuity option, if you suddenly are deceased, the payments will stop; and then there's devaluation of currency to worry about 30 years down the line. Your children will have nothing and you'll leave nothing behind. Always accept the lump sum and have your money managed well by professionals you trust - as opposed to an entity controlling when you get to have the money you won. I'd take it all at once and be at peace, having a great time instead of worrying about my next check or a conditional promise.
I completely agree. Who knows where any of us will be tomorrow. I'd take the lump sum and give whatever amounts away to my family I was going to.. buy a new car and my own paid for in full house and hoard away the rest. Not in a mattress or anywhere inside the home though because a house fire could clean you out in nothing flat and then where would you be.
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Old 03-02-2012, 10:45 PM
 
96 posts, read 160,112 times
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By not taking the lump sum, you run the risk of inflation wrecking the value of your later payments.
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Old 03-02-2012, 10:54 PM
 
Location: California
29,409 posts, read 31,597,509 times
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I would take a lump sum of $6M. I did some reading on the CA lottery a few years ago and you don't actually get and even distribution over the years, the payment starts out smaller and gets larger over time. I can't remember why that is. I'd want my money so I can play with it. It's a windfall afterall!
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Old 03-03-2012, 03:18 PM
 
2,110 posts, read 4,022,213 times
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Is it better to take a lump sum from the lottery or sell out to someone like JG Wentworth? Which one would pay the most?
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Old 03-03-2012, 08:50 PM
 
9,170 posts, read 10,950,817 times
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Quote:
Originally Posted by Gunluvver2 View Post
I believe that $250,000 figure is per account per bank.

GL2
Per social security number per bank. Husband and wife could easily put 500k away at each bank.
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Old 03-03-2012, 08:55 PM
 
9,170 posts, read 10,950,817 times
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The Robbie family lost the Miami Dolphins football team due to poor estate planning. Team was valued at 350mm and they owed Uncle Sam 175mm in taxes after Mrs. Robbie died. They were forced to sell since they didn't have that kind of cash.

The annuity is invested in US treasury bonds so if the USA goes the way of Greece then you as a lottery winner might not get paid!

Take the cash, imagine the bump you would get in returns if inflation hits and we go back to 15% interest like the early 80's!
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Old 03-03-2012, 08:57 PM
 
9,170 posts, read 10,950,817 times
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Quote:
Originally Posted by wrcousert View Post
Is it better to take a lump sum from the lottery or sell out to someone like JG Wentworth? Which one would pay the most?
Obviously the lottery.....they pay the cash value up front. Wentworth pays a portion of the annuity and keeps the rest as their fee!
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Old 03-03-2012, 09:02 PM
 
9,170 posts, read 10,950,817 times
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Quote:
Originally Posted by oneasterisk View Post
I'd take the lump sum to blow on goddesses and briefcases of cocaine.
Classic!

Don't threaten me with a good time....
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Old 03-04-2012, 11:55 AM
 
Location: NC
4,056 posts, read 1,397,775 times
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Quote:
Originally Posted by TechGromit View Post

Ok, lets re-run the numbers. So the Mega Million lottery is 20 million dollars, you win, take the lump sum, you end up with $14,600,000 before taxes. True the highest Federal tax bracket is 35%, but now the state wants a portion of that cash too. (at least in NJ), so Federal plus 11% for state equals 46%, you end up with $7,884,000. I on the other hand, end up with $540,000 a year or a total of $10,800,000 over 20 years.
The problem with this argument is the TMV[time value of money] screws you more and more each year and you are looking at these numbers in absolute terms instead of inflation adjusted. They have it calculated such that, in most cases, you are not going to come out ahead on either option.

With that said, I see no reason not to take the lump sum, because I don't trust the gov't not to reneg and retroactively enact tax plans that could negatively affect the payments being made to you. In addition life for the next x # of years isn't guaranteed.
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